Nettoväärtus

Nettoväärtus, often translated as net worth, is a fundamental financial concept representing the total value of an individual's or entity's assets minus their liabilities. It essentially measures what someone or something is truly worth in monetary terms. Assets encompass everything of value that is owned, such as cash, investments like stocks and bonds, real estate, vehicles, and other possessions. Liabilities, on the other hand, represent all outstanding debts and financial obligations, including mortgages, loans, credit card balances, and any other money owed.

Calculating net worth provides a snapshot of financial health at a specific point in time. A positive net worth indicates that assets exceed liabilities, suggesting a financially stable position. Conversely, a negative net worth means liabilities are greater than assets, implying a state of financial distress or indebtedness. Tracking net worth over time can reveal financial progress or decline, making it a crucial metric for financial planning, investment strategies, and understanding one's overall economic standing. Financial advisors often use net worth as a key indicator when providing guidance on wealth management and goal setting.