What is a personal financial statement of assets and liabilities?

What is a personal financial statement of assets and liabilities?

A personal financial statement of assets and liabilities is a document that outlines an individual’s financial position at a specific point in time. It typically includes a list of the individual’s assets, such as cash, investments, real estate, and personal property, as well as a list of their liabilities, such as credit card balances, student loans, and mortgage payments.

The personal financial statement also includes a calculation of the individual’s net worth, which is the difference between their assets and liabilities. A positive net worth indicates that the individual has more assets than liabilities, while a negative net worth indicates that they have more liabilities than assets.

A personal financial statement can be a valuable tool for managing money and achieving financial goals. It can help individuals understand their financial situation, identify areas of strength and weakness, and make informed decisions about managing their money.

It is important to regularly review and update a personal financial statement to ensure that it accurately reflects an individual’s current financial situation. This may include updating the values of assets and liabilities, as well as making any necessary adjustments to reflect changes in financial circumstances.

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