Increase Your Net Worth

Q.1. What is net worth?

Your net worth is the sum of your total assets minus the sum of your total liabilities. There is a worksheet to help you calculate your net worth.

Q.2. What are some ways to increase my net worth?

You can increase your net worth in one of two ways. You can increase the value of your total assets. Alternatively, you can reduce the total of your liabilities. By using the worksheet you can see where you might take action.

Q.3. When I save money what can I do with it so that I can get easy access to it?

You should keep some money that you save available for emergency situations. You can do this by putting the money in what is called cash equivalents. This includes chequing or savings accounts, Money market funds or T-bills. There is little risk of losing your money and you can easily get access to it.

Q.4. Where can I put my money for shorter term investment?

Once again, chequing or savings accounts are a good choice. In addition, you could consider GICs and Canada Savings Bonds. Make sure that you know the interest rate you will be paid and any costs related to withdrawing the money if needed. Check around for the best rates.

Q.5. How do I reduce my liabilities?

Review your expenditures and budget and make certain that you are spending wisely. There are a number of ways to save money. In addition, pay off your debts as soon as you can, starting with the ones with the highest interest rate. These are normally your credit cards. Negotiate with your creditors for a lower interest rate if possible. Consolidate your debt using a consolidation loan or home equity loan so that you can get a lower interest rate and pay off the debt more quickly.