Financial experts always tell people to start saving early if they hope to retire early, and there are ways to save now to get there faster.
Every day in the U.S. there are nearly 10,000 people who reach the age of 65. Knowing how much you have to save now can save you a big hassle later.
Financial planners say you should ask yourself this question — do you know your net worth? The question isn’t just for billionaires like Warren Buffet and Bill Gates. It’s key if you want to understand your financial well-being, what your retirement will be like financially, and what assets you have to give to your family.
Here’s how to calculate your net worth:
- Assets minus liabilities equals net worth.
- Just in case you need a refresher, liabilities are things that you owe — like credit card debts, mortgages, student loans, etc.
- Assets are things that you own — like the market value of your home, investments, IRAs 401Ks, jewelry, etc.
Here are some money saving tips to help you build your assets:
- Avoid using your credit cards and pay with cash.
- Cut monthly costs by eating out less.
- Get rid of your landline and only use a cellphone.
- Use generic prescriptions.
- Use coupons whenever you can.
It’s recommended that you update your net worth statement at least once a year to account for changes in values. And remember that a net worth figure doesn’t include your life experiences or personal happiness, which may not be a gauge of how financially well-off you are.