Читать книгу Finances After 55 - Sylvia Lim - Страница 28

Divide the accordion file into two sections. Label the first half of the file “Assets,” and the second half “Liabilities.” File your asset-type statements and papers in the “Assets” section, preferably in the same order as you listed them on the Net Worth Worksheet. Do the same with the liability-type statements and papers.

To see how net worth can act as a financial snapshot, look at Sample 2, the completed Net Worth Worksheet of John and Mary as at September 30, 2004. They’re both in their early 60s and in good health. Note the following:

1. John has assets of $223,000; Mary has $224,000; and assets in joint names of $437,750. This brings the total household assets to $884,750 as of September 30.

2. Their household liabilities total $28,000.

3. The household net worth is $856,750. That’s the difference between total assets and total liabilities.

4. They have bank savings totaling $31,000. The cash in the term deposits and savings is for emergencies. It can be accessed immediately.

5. They have income-producing investments and retirement savings worth $100,750 and $400,000 respectively.

6. They have $30,000 cash value in their life insurance policies. They have named each other and their two grown children as beneficiaries. The cash value will continue to grow over time. They can choose to borrow against it or withdraw the balance at a later time.

7. Their house is worth $250,000, with a remaining mortgage balance of $25,000.

8. They own two vehicles and a recreational vehicle worth $40,000.

9. They have prepaid their respective funeral arrangements.

10. They have purchased critical illness insurance, paying them $50,000 each should they become terminally ill as defined under their policies.

11. John has guaranteed their son John Junior’s personal loan of $2,000, which John Junior is expected to repay in full.

They are comforted by the knowledge that —

• they have savings set aside for emergencies, which are sufficient to support them for the next six months;

• they have investments inside and outside their retirement accounts;

• their debts are small and manageable;

• they have insurance coverage (such as property, life, health care and critical illness insurance) to protect themselves against certain unexpected perils; and

• their home can provide them with options for additional income. (These options are discussed in Chapter 8.)