Debt Reduction, Where My Money Goes

Something New: Calculating my net worth

Reading “Blogging Away Debt” with Tricia is one of the reasons that I became a frugal living/debt reduction blogger in the first place. Her update in today’s blog was an update on her net worth and it made me curious to see what my net worth is.

Simply put, net worth is “the amount by which a company or individual’s assets exceed their liabilities” and unfortunately in my case, my liabilities exceeds my assets giving me … drum roll … a NEGATIVE net worth.

Want the dirty details? I’m going to be tracking my net worth at NetWorthIQ … here’s my public profile.

I’m pretty new at this so you’re going to have to bear with me, but here’s a glimpse at my situation: I have $241 in cash – that’s what I have in my INGDirect savings account. Unfortunately, my ~$27,000 in debt WAAAAAAAAY overshadows my meager savings: $21,000 represents my student loan; $4,800 is credit card debt and I need to double check what I still owe on the Rattling Death Trap (RDT), but my best guess is $2,000. (I’ll find out and update that …)

NetWorthIQ is a free website and you have the option to keep your information private if you choose. You can also share it with the world.

Am I bummed about my negative net worth? I don’t think anyone is happy about a negative number representing their worldly finances, but the bulk of my debt is “good” debt. There was a time when I had $10,000 in credit card debt, so things could be much worse.

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1 thought on “Something New: Calculating my net worth

  1. Remember that for your car, what you owe isn’t actually what you should use in the net worth calculation – it’s what you owe vs. what the car is worth. Just like your house – if you have positive equity in your house, that should actually increase your net worth. I did this calculation for myself and was pleased to think about the things I actually DO have equity in.

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