Calculating your true net worth with NAV Planner
Knowing your net worth is key when it comes to your finances. Understanding your net worth helps you find out how you’ve been saving and spending. It also guides you to plan your financial goals, letting you know how near or far you are from meeting them.
How it’s different from money-in-money out feature
You may have already developed some pretty good personal finance habits using the money-in-money-out feature, such as:
- Track your monthly expenses to ensure you’re earning more than you spend
- Saving a fixed amount each month
- Built up emergency savings of at least 6 months during a crisis
It’s good if you just want a picture of how you are doing month after month. But this is just your ‘Net Position’.
To level up, you’ll need a view of your overall financial situation. That is where the Net Worth view is helpful.
Why it’s important to know your net worth
Your net worth is the value of all your assets minus all your liabilities.
A personal asset is anything you own that has monetary value. If you own it and can sell it, it is an asset. A liability is anything that you owe and eventually have to pay back.
All your assets and liabilities with DBS have already been automatically added. If the numbers don’t seem right to you, fret not! You’ll just need to connect your other banks’ accounts, loans and CPF to get a complete picture of your net worth.
Find out more about getting started with SGFinDex.
How to get better at money
1. Beef up your emergency savings
This is particularly important if your cash savings are less than 3x of your monthly income. One way is to spend more mindfully, i.e. spend less. And do this other simple thing: keep your cash savings in high interest rate accounts such as the Multiplier account, which can help grow your money faster than a basic deposit account.
2. Make debt repayment a priority
This applies if your net worth is projected to stay negative for some time. You might want to consider refinancing your home loan to enjoy some savings.
3. Consolidate your debts
If your debt is growing faster than your assets: Consider consolidating debts at a lower interest rate to help accelerate your debt payoff.
4. Start investing if you haven’t
Caveat: Invest only if you already have 3 months of emergency funds. It’s a good way to beat inflation, grow your assets and ultimately, build your total net worth.
How to get started
|STEP 1: Open digibank
Log in to digibank and look for the Plan tab.
|STEP 2: Update your non-DBS cash, CPF, investments, property value, home loan, car loan:
Ready to start?
Speak to the Wealth Planning Manager today for a financial health check and how you can better plan your finances.
Alternatively, check out NAV Planner to analyse your real-time financial health. The best part is, it’s fuss-free – we automatically work out your money flows and provide money tips.
Disclaimers and Important Notice
This article is meant for information only and should not be relied upon as financial advice. Before making any decision to buy, sell or hold any investment or insurance product, you should seek advice from a financial adviser regarding its suitability.