MEASURING PERSONAL WEALTH A person can go through 12 years of public school and 4 years of college and never be taught how to measure personal wealth. In our consumer society much of what we take to be “wisdom” is actually just brain washing by advertisers. We have become convinced that as long as we can afford the payment and someone will lend us the money that it is probably a good idea. The true measure of personal financial wealth is NET WORTH. Net worth is defined as ASSETS – LIABILITIES = NET WORTH. All financial decisions should be evaluated on the basis of how it affects Net worth long term. It has been said that the average American male retires at 65 years of age with a Net worth of under $10,000.00. In computing Net worth, social security benefits and pensions are not calculated as neither will survive you and pass on to your heirs. Take a few moments and calculate your Net worth: ASSETS: LIABILITIES: NET WORTH: Totals Don’t let the reality of the situation bother you. Take hope in the fact that with God’s help and some training that you can turn this situation around. It does take long term vision and persistence. Advertisers for cars in particular talk about a car being an investment. This is not true when you evaluate the purchase in the light of Net worth calculations. You buy the Asset, the car, and typically finance it. As soon as you drive it off the lot, you take a loss for depreciation. The car is now “Used” and is worth a lot less. You couple the depreciation with finance charges and you have actually created negative net worth, i.e. you have increased your liabilities more than your asset base. The best way to build personal Net worth for the average working person is to live on less than you make, investing and saving the difference. Deuteronomy 28 speaks to the issue of financial blessing and cursing. God’s word indicates that being in debt is a sign of a curse. It is wrong, in my opinion, for a child of God to view living in debt as a normal condition. It is the same as saying, “My long term plan is to live under a curse”. Your first goal financially should be to eliminate as much consumer debt as possible. Set up an emergency fund to avoid using credit cards in the future and then long term make it a goal to become your own banker. Save up the money you need for purchases before you ever make the purchase. Once you make progress in this area, make it a long term goal to start investing long term and follow the sequential steps to financial freedom as set forth in Crown’s MONEY MAP. Join us on the journey to FREEDOM!!!!!!!
Posted on: Wed, 07 Aug 2013 18:34:47 +0000
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