You may need to change your family spending and borrowing habits before you are so deeply in debt that you cannot get out. Deficit financing may be possible for the government, but it doesn't work well for individual or families. To figure net worth, draw a line down the middle of a sheet of paper. List all personal or family assets on one side of the line, and all liabilities and debts on the other, then total each line. The difference between the two totals is net worth or net indebtedness, Wright said.
Assets are items that have substantial value and can be converted into cash.
They include checking and savings accounts, the market value of a home or other real estate, cash value of life insurance and retirement or profit-sharing plans, market value of vehicles, stocks and bonds and money owed to you. Some assets, such as houses, gems and antiques, appreciate or gain value every year. Other assets, including cars and furniture, depreciate or lose value. Liabilities are financial obligations, such as the unpaid part of a home mortgage, mortgages on other property, a balance on a car loan, outstanding charge accounts, credit debt and unpaid bills, Wright said. Net worth will change periodically depending on appreciation or depreciation of possessions and property.