Do you want your net worth to be higher? How can you increase it? You can do it by implementing these four simple strategies.
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How can you increase your net worth? David has four simple strategies for you to implement. None of them are shocking secrets, but it helps to focus on key ways you can use to raise your net worth.
Before you can raise your net worth, you need to know what it is. Creating a net worth statement was listed among one of the financial New Year’s resolutions. Getting an understanding of what your net worth is will allow you to know if it is increasing and how.
Within the net worth statement, you need to list both your assets and debts. Do you know if these are good debts or bad debts? Will the assets that caused this debt appreciate? Do you have credit cards? A great way to reduce your net worth is by carrying credit card debt.
Does your spending align with how much you make? If you’re spending more than you’re making, then you have a problem that will increase over time and severely impact your ability to retire and live long-term the way you want to live. You’ll need excess income in order to acquire assets that will increase in value.
What happens if you get in a car accident or lose your job? Do you have an emergency fund? If you don’t, you might work yourself out of financial issues in a pinch is by borrowing money, ultimately causing more debt. If you have an emergency fund in place, you’ll protect yourself from a tough time financially.
Another big way to increase your net worth? Increase your income. While easier said than done, think strategically about how you can make this happen. Can you make your talents more valuable to get a raise or find a new job? Maybe you get more education or maybe you start a side business.
Are you ready to increase your net worth?
Listen to the full episode or click on the timestamps below to hear the four simple steps to increasing your net worth.
[2:19] – You may know the strategies to do, but you have to take action.
[3:10] – Start by knowing what your net worth is.
[4:15] – Step 1: Understand your debts.
[11:21] – Step 2: Cut your expenses.
[13:40] – Step 3: Have an emergency fund.
[16:01] – Step 4: Increase your income.