Assets
What is an asset?
Something you own that has value.
What is a liability?
Something you owe, debt.
What is the formula for net worth?
Which of the following is an asset: clothes, phone, property?
All of the above
Your friend bought you 60 wings from WingStop because you asked. Would this be considered a liability for you?
Yes
How can you increase your net worth?
Is your school laptop your asset?
No
You have a loan of $2000 and pay off $500 dollars but you buy a new tv for $3000 on your credit card? Did your liabilities increase or decrease in value. What is its new value?
Increase; $4500
You have a house worth $500,000 with an outstanding mortgage of $125,000. What is your total equity on the house?
$375,000
Would a business idea you have be considered an asset?
Yes
What is a liability that you can have to your school.
Lunch money negative balance, fines and fees list, etc
You have assets of $50,000 and liabilities of $100,000. What does this show?
Define and explain the difference between a depreciating and appreciating asset. Give examples.
Depreciating: Assets decreasing in value.
Appreciating: Assets increasing in value.
How can having a liability help you build your net worth?
You could get a loan to buy a house or finance a business, which will grow your value of assets.
Who is in better financial state: John who has low assets and low to none liabilities or Jane who has high assets and high liabilities?
John, high liabilities are always risky no matter how high assets are.