To figure it out, you add up all your assets such as savings, investments, real estate holdings, retirement accounts, etc.
Then deduct from that number all your personal liabilities (credit card balances, mortgages, student loans, etc.) and the difference is your Net Worth, assuming your Assets exceed your Liabilities.
Money market accounts sold by brokerage firms are a type of mutual fund and their share value can fluctuate based on the value of the underlying assets.
FDIC insurance is not unlimited. It is subject to certain dollar limits per depositor and total coverage in any one bank can be affected by type of account (e.g. single, joint ownership, trust) as account balances for insurance purposes are tallied per depositor in each bank.
It is rare, but there have been historical instances when mutual fund money market accounts have “broken the dollar.” Brokerage based MMAs are insured by the Securities Investment Corporation (SIPC) , not the federal government.
Financial firms offering MMAs make every effort they can to maintain the dollar per share valuation.
It is the difference between what you owe on your mortgage loan(s) and what your house’s market value is. (Other owed amounts, such as debts secured by property liens, can also reduce equity.)
For example, if your house is worth $200,000 & you owe $125,000, your “equity” is $75,000.
This is a different amount than what you would realize at closing if you sold your home because the costs related to the sale of your home (e.g., real estate commissions, real estate transfer taxes, etc.) will be deducted from your net proceeds at closing.
To calculate your personal net worth, identify all your assets (e.g., cash, investments, personal property, real estate, retirement accounts) and all your liabilities (e.g., credit card debt, auto leases, mortgages, student loans).
Then subtract the total liabilities amount from the total asset amount. The difference is your Net Worth.
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