15 Most Important Assets That Will Increase Your Net Worth

Jennifer Taylor   Tue, December 13, 2022

Your net worth is more than just the balance in your bank account. It's a measure of your financial health.

To get the answer to "What is my net worth?" subtract your total liabilities from your total assets. If you're trying to figure out which assets are the most valuable or will otherwise give your net worth a boost, here's a rundown of 15 critical assets. Learn how you can start making lucrative investments toward your future.

1. Owning Your Primary Residence

Homeownership ranks among the most common ways people gain a substantial increase in net worth. Instead of choosing the traditional 30-year mortgage, opt for a 15- or 20-year term, so you can pay it off more quickly, which will result in a significant asset and savings on interest. And if you decide to sell after you pay your home off, capital gains are tax-free up to $500,000, as long as your status is married filing jointly.

Renting might make more financial sense than owning in some high-priced urban areas, depending on whether the cost of ownership is reasonable in relation to total living expenses.

Take Our Poll: How Long Do You Think It Will Take You To Pay Off Your Credit Card Debt?

2. Second Home

Second homes are a savvy way to earn passive income via short-term rental platforms like HomeAway, VRBO or Airbnb. At first, you can use the extra income to help pay off your mortgage more quickly. Then, once you pay off the mortgage, you'll own a significant asset while still benefitting from the passive income of renting it out if you choose -- both can result in a nice gain in your net worth.

3. Retirement Savings

Retirement might be decades in the future, but saving now can enhance your net worth.

To continue reading, please go to the original article here:

https://news.yahoo.com/15-most-important-assets-increase-133014378.html