NET WORTH IMPROVEMENT STRATEGIES

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Here's a simple process to help monitor and enhance your Net worth situation:

My Action Plan includes the following steps:  

Step 1 - Reduce My Key Expenses

Step 2 – Pay myself by saving _____% or $ ______ of my total monthly gross income of  $________ in a RRSP, etc. starting  _______. This amounts to $_____ annually. Note: 10% is a good start!  

Step 3 – My key asset growth target (primarily house & investments) is estimated at ___% over the next 12 months, based on real estate and investment projections. To arrive at a realistic target, multiply the projected appreciation % by current values. For example:                       

Step 4 – Identify major expenses over the next 12 months (i.e. house repairs) which will significantly increase your liabilities vs. the current year. A house renovation of  $10,000 will have a negative impact if your Net Worth is low. Should it be delayed until it is more affordable?  

Step 5 - Net Worth Target Calculation:   Add Steps 1+2 +3 and subtract Step 4.  

If these actions don’t achieve your Net Worth target in the upcoming year, cut more expenses until it does, or reduce your growth target to a more realistic goal.