Image Credits: pixabay.com (License: CC0 Public Domain)
With the wealth you possess right now, do you barely get by or do you live lavishly?
Realize your financial situation by actually calculating your net worth. It is pretty straightforward! Simply add up the value of your assets and deduct the value of your liabilities.
Assets include savings, investments, CPF balances, insurance, properties, cars, or anything you own with monetary value. While liabilities include loans, mortgages, credit card debt, or all the money you still owe.
To save you time and effort, here is a tool to help you calculate and benchmark your personal net worth: salary.sg/2007/calculate-net-worth-and-benchmark-it. Remember to measure your net worth every six months to a year as recommended by financial experts. Doing too often may lead to unnecessary stress and panic.
Interestingly, one might end up with a negative net worth due to taking on a number of loans and poor money management skills. Do not let this happen to you!
Consider these 5 Surefire Ways To Boost Your Net Worth:
1. BE A DEBT NINJA
Slice debts out of your life as soon as possible. You probably heard this tip before. But, it goes without saying that aiming to clear off the high-interest debts (e.g., outstanding credit card balance) will help you pay lower interests in the long run.
Minimize the negative effects of debt while increasing your wealth by taking part in the debt diet, as popularized by Oprah Winfrey.
2. SPEND LESS
Nobody, including me, likes to hear that they are spending too much. I know how delicious a cup of Starbucks caramel frappuccino is or how satisfying it is to get the latest IPhone but these things will catch up on your wallet. The small and big expenses can add up as fast as Kopitiam queues lengthen during lunch time.
This is why you must take down your expenses everyday for at least a week and realize your spending habits. By knowing so, eliminate or reduce the areas which are unnecessary. This act of cutting expenses can have a substantial impact to your net worth!
3. INVEST MORE
It only makes sense that making your money work for you can improve your wealth. If you have spare cash lying around your savings account (experiencing small interest growth), consider investing in index funds, unit trusts, bonds, or RIETs (Real Estate Investment Trust).
*Friendly Reminder: If you do not have enough knowledge or did not consult a financial adviser, please refrain from committing to any type of investment first.
4. GET A RAISE
Another way to increase your wealth is by increasing your income. If you have been in the organization for a period of time and feel that you had done some good, there is no harm in asking for a reasonable pay raise.
Do not open a discussion with your boss unless you are fully prepared. Consider these six things to help you prepare.
5. SEEK PROFESSIONAL HELP
One of the most underrated and overlooked step to growing one’s net worth is seeking professional help. Many people are ashamed of their current financial state and get sucked in their negative tracks. Fear not my friend as experienced professionals are able to guide you in budgeting and planning as well as provide you with the latest information on how to grow your assets.
Image Credits: pixabay.com (License: CC0 Public Domain)
There may be no secret formula to permanently increasing your wealth but every time you decrease your debt and boost your assets, your net worth certainly spikes up!
