Net worth is a small phrase that refers to a big concept. It’s a reference to a person’s total assets, minus their liabilities. For example, your net worth might include the money you have saved, your retirement account and property you own, minus things like student loan or credit card debt.
In simplest terms, your net worth is your owned assets minus the debt you owe.
Net worth is a general measure of your personal finances, and it’s often used by people to gauge their success or progress regarding their finances. Of course, it’s more beneficial to have a higher net worth because that means you have not only more assets but also less debt.
If you want to find ways to increase your net worth in 2017 that don’t require you to take on another job, consider the following:
Create a Plan To Pay Off Debt
One of the top ways to increase your net worth without having any additional income or assets is to pay off your debt.
You need to pay the money you owe to grow your net worth, so use 2017 as an opportunity to create a viable plan to get rid of your debt. Start with high-interest debt and move from there. A lot of your focus should go toward making extra payments on your debt.
Consider Investment Options
If you have all of your money sitting around in a savings account or even a money market, you’re not going to be able to grow your net worth. Interest rates are low, and this isn’t a good way to grow your existing money over time.
Instead, you might consider investing. You could invest in safer options like mutual funds, or go with riskier strategies such as investing in OTC or penny stocks that tend to have opportunities for higher returns.
Take Account of Your Expenses
If you’re not able to save or invest as much money as you’d like to, it might be time to take account of your expenses. If you don’t know where you’re spending money, there’s no way for you to see where you can make changes.
If your goal is to grow your net worth in 2017, a good starting point is to look where you’re spending your money and also identify key places you can cut your spending.
Take Advantage of Retirement Programs
If your employer offers access to retirement programs, such as a 401(K), make sure you’re taking advantage. You may not even know about the options provided by your employer, such as matching programs, so talk to someone at your work to ensure you’re taking advantage of all possible retirement options.
Maxing out your retirement contributions can not only make sure you’re gradually building your net worth and your retirement savings, but they also tend to have tax benefits. If you can reduce your tax liabilities, that’s an excellent way also to improve your net worth.
The concept of increasing your net worth can sound daunting, but there are simple tips like the ones listed above that can actually make it easy, yet valuable.