12 FINANCE & NON-FINANCE ELEMENTS OF AN INDIVIDUAL’S NET WORTH.
An individual’s net worth is mostly calculated based on finance being the value of their assets minus their liabilities. It is a measure of a person’s financial standing and is calculated by subtracting the total value of debts and other obligations from the total value of assets.
Net worth goes beyond finance to some other non-finance elements which are equally essential though hard to put a number on. Today we are looking at 12 finance and non-finance elements that constitute the net worth of an individual:
1. Assets: These are items of value that an individual owns, such as property, investments, cash, and personal belongings.
2. Liabilities: These are debts and other obligations that an individual owes to others, such as mortgages, loans, credit card debt, and taxes owed.
3. Investments: These are assets that are bought with the expectation of generating a return in the future, such as stocks, bonds, mutual funds, and real estate.
4. Savings: This is the amount of money an individual has set aside for future use, such as emergency funds, retirement savings, and college savings.
5. Income: This is the amount of money an individual earns from employment, investments, and other sources.
6. Expenses: These are the costs associated with living, such as housing, food, transportation, and entertainment.
1. Social capital: This refers to an individual’s social networks, relationships, and reputation. A strong network of contacts and a positive reputation can provide opportunities and resources that can have a positive impact on an individual’s overall well-being.
2. Health and well-being: Good physical and mental health can contribute to an individual’s overall net worth by enabling them to work, enjoy life, and avoid medical expenses.
3. Education and skills: Education and training can provide individuals with the knowledge and skills needed to advance in their careers and increase their earning potential.
4. Personal values and goals: An individual’s personal values and goals can impact their sense of purpose and fulfillment, which can be an important element of overall well-being.
5. Time and freedom: Having control over one’s time and freedom can provide opportunities for personal growth, creativity, and enjoyment of life, which can contribute to overall well-being.
6. Experience & Exposure: Having experience through years of hands-on learning, trial and error, and practical application of knowledge and Exposure through familiarisation with particular concepts, ideas, and environment put one at an advantage and greatly contributes to their net worth.
So which of these elements do you possess and which do you plan on enhancing to increase your net worth and make you more valuable to the marketplace?