It is simply net worth is an
amount in which assets exceed liabilities. This concept is applying to
individuals, companies for serving a benchmark for calculating financial
health. It is very simple to calculate because easy formula is use to measure
it. Formula of calculating this worth is net worth= assets –liabilities.
Exceeding asset is very beneficial for you because it is positive. However, exceeding
liability is very harmful for you because it is negative. By calculating this
worth, you know that what you spent and what you earn.
Following are the reasons to
calculate net worth:
If you are rich and wanted to
know about your assets and liabilities then calculating worth is a best option
for you. By calculating worth, you can easily know about your yearly expenses.
You can get information about your income. If you have large expenses over
income then you can control your expenses. At the time of calculating worth,
you have to take accurate amount of assets and liabilities. Sometimes people
are not taking proper amount of liabilities and assets, which creates lots of
problems at the time of calculating.
If you can calculate your right
worth then you can get information about financial position. Working capital is
very important due to which can also get knowledge about it by calculating this
worth. Net worth is just like a stock market because it fluctuates their value.
The value of this worth is depending on trend. Sometime situation is
creatingwhen it values fall down. If you have a proper worth then you can show
it at the time of business deals, which is very helpful for you. Celebrities
can also calculate it because it is very effective for their reputation. If you
have a worth then your fans can get information about you in an easy way.
For more information click on this link personbio.org
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