University of Wisconsin - Extension

"That's a question politicians like to ask at election time. But it's also a good question to ask yourself on a regular basis to check your progress toward reaching your financial goals," says Linda Boelter, University of Wisconsin-Extension family financial management specialist and certified financial planner.

Boelter says the best way to check your progress is to figure your net worth.

"Just like a business prepares a balance sheet to show the company's financial position, you can take a look at your personal balance sheet to see how well you are doing and where you could make changes," she says.

The task isn't hard. Take a piece of paper and divide it into two vertical columns. On the left, list all your financial assets--cash, savings, and balance in your checking account. Then list the current value of certificates of deposit, savings bonds, mutual funds, or any other investments. Don't forget about money in your IRAs, 401(k) plan, or other retirement accounts.

Include the value of any real estate you own, vehicles, and other personal property, using the fair market value, not what you paid.

"Some things, like real estate, may go up in value over time. But other property, like a vehicle, goes down. The fair market value is what someone would be willing to pay to purchase your property," Boelter explains.

Next, list what you owe. This includes the balances on any outstanding loans--your mortgage, balance on credit cards, car loans, student loans and so on.

• Where are most of the assets? Are they mostly in a house or vehicle?
• How much of the assets are liquid, or easily turned into cash?
• How much is available to be used in a financial emergency?
• Are the debts growing faster than assets?
• How does this statement compare with last year's statement?
• Are you saving enough to reach your financial goals?

For more information to help you improve your finances, contact your county UW-Extension Office about enrolling in "Money 2000 and Beyond," an educational program designed to help you increase your savings and reduce your debts.