So, let’s say you did it: you have a sheet showing your net worth. Now what? How is this useful?
- Nothing is scarier than the unknown. Being in the dark, leaves us fearing what we imagine.
Shedding light on the numbers, and seeing where you are financially is a lot more comforting than you anticipate!
- You can celebrate your accomplishments!
If you can’t see where you are, it will be hard to see how far you have come a year from now.
- In our reptile brains…
Humans often experience money saved/invested as a loss, because it has left the pot where we can spend it today.
Seeing your net worth shows all the gains you’ve made! Watching your “Vacation in Tahiti Fund” swell, will make you want to skip lunch out and pack a sandwich.
- Makes communication in relationships easier, especially if you don’t like talking about money or individual purchases.
It is a fast way to get a snapshot of the big picture.
Now that you have your net worth, and maybe some goals for the next year, put it away. In a year you can check again and see how much closer you are to your goals!
Why Didn’t They Teach Me This In School by Gary Siegel
The Boglehead’s Guide to Investing, 2nd Edition by Taylor Larimore, Mel Lindauer, Michael LeBoeuf