America Saves Week is February 25 – March 4, 2007. All around the country people are taking time to set saving goals and review their financial net worth. You can participate too.

According to a recent survey by the Financial Planning Association, more than three-quarters (77%) of financial planners think it is very important people understand what is net personal wealth. However, only about half of Americans know how to calculate their net worth. Your net worth is what you own, after you have subtracted what you owe. A net worth statement is a snapshot of your current financial situation.

To prepare a net worth statement, begin by listing all your assets; this is everything you own. Do not forget your checking account balance, retirement account value, as well as the market value of your car and your home. Next, list what you owe – your liabilities. Credit card balances and installment loans (such as for furniture, car or electronic equipment) are examples of liabilities. The amount of principle owed on your home mortgage is another liability. The last step is to calculate the difference between your assets and your liabilities.

Over time, you want your assets to be larger than your liabilities, and for your net worth to grow. However, students and people starting out in life may have a negative net worth. The important thing is to know your net worth and make financial choices to help it grow in the long term. To use an online calculator to figure your net worth, go to the America Saves website at http://www.americasaves.org/resources/estimators.asp .

Knowing your net worth is the first step. The next step is to set a saving goal. According to the Retirement Confidence Survey, 54% of people who are not currently saving say that they could save $20 a week towards retirement. Of those people who are already saving, 72% say they could save an additional $20 a week. Can you commit to saving $20 a week? This may not sound like enough money to make a difference, but it is. Twenty dollars a week is over $1,000 a year. If you saved $20 a week for 25 years, you would have over $50,000 (assuming a five percent annual rate of return).

Set your saving goal today. You can do this and enroll at the America Saves website, http://www.americasaves.org. Once enrolled you will receive newsletters, saving tips, and other information to help you reach your saving goal and increase your net worth.

Source: Kathy Sweedler, Extension Educator, Consumer and Family Economics, sweedler@uiuc.edu