"Great things never came from comfort zones"           "Wealthy people invest first and spend what’s left and broke people spend first and invest what’s left"           "Good, better, best. Never let it rest. Till your good is better and your better is best"           "Investment is an asset or item that is purchased with the hope that it will generate income or appreciate in the future"           "You cannot save time for future use, but you can invest it for the future you"           "The secret to getting ahead is getting started.................Start using your Savings to Earn Money"           "The best gift, and investment, you can give your child is your time"           "Investing in your child’s education is never a wasted effort"           "Do something today that your future self will thank you for"



Net Assets vs Net Worth

Net Assets refers to the value of a company's assets minus its liabilities. For individuals, the concept is the same as Net Worth.
Net assets, means total assets minus total liabilities.

In a sole proprietorship the amount of net assets is reported as owner’s equity.

In a corporation the amount of net assets is reported as stockholder’s equity.

In a not-for-profit (NFP) organization the amount of total assets minus total liabilities. 

For Example-

M/s ABC Ltd.’s balance sheet shows Rs. 75,00,000 as assets and Rs. 25,00,000 as total liabilities. The company's net assets would be:


Net Assets = Rs. 75, 00,000 – Rs. 25,00,000 = Rs. 50,00,000

Net assets value is term used mostly for funds, it is the value of a mutual fund scheme’s assets minus the value of its liabilities per unit. It is the price at which you buy the unit of a scheme. It may also be the price at which you would sell the units.

NAV reflects the composite prices of all the securities held along with the liquid cash. It is calculated on a unit basis after deducting all liabilities. If the prices of the majority of the securities held by the scheme goes up, the NAV will also rise and vice versa.

For Example-

Mr. X invested Rs 50,000 in a scheme with an NAV of Rs 250, he will get 200 units (i.e.50,000/250). If the NAV increases to Rs 400 in a year and Mr. X has sold it. So, Mr. X will get Rs 80,000 (i.e.200 units x Rs 400).

If the net assets value of the company reflects higher, it will shows that the company grow their business or have good reputation but if the net assets value of the company reflects negative, the company’s in trouble.

Net worth- is similar to net assets, it also includes total assets minus total liabilities,

If your net worth have negative balance, it shows you are in financial crises. You have to reduce your liabilities or expenses. If your net worth have positive balance, it shows you are in good situation. You have always to increase your wealth. Banks and financial institutions always check their net worth to provide you any loan facilities etc.

Total Assets includes Fair Market Value or Estimated value,

  • Immovable Assets (i.e. FMV of Land and building commercial or residential)
  • Jewellery
  • Vehicles
  • Bank balance including FDR’s etc
  • Shares & securities
  • Investments with any banks or financial institutions
  • Furnitures
  • Investments with any firms as partner or proprietor
  • Other assets (if any)

Total liabilities includes Fair value,

  • Loans i.e. Property loan, Vehicle loan, Education loan, personal loans (if any)
  • Dues of Credit card bills etc.
  • Any liabilities (if any)

Net worth means Total Assets – Total Liabilities


For Example-

Mr. X, have the following fassets and liabilities as on 31.12.2017 as under-
  • Residential House (Fair Market value) : Rs. 25.00 lakh
  • Plot (FMV) : Rs. 15.00 lakh
  • Jewelerry : Rs. 5.00 lakh
  • FDR’s : Rs. 5.00 lakh
  • Mutual Funds : Rs. 8.00 lakh
  • Vehicles : Rs. 10.00 lakh
  • Bank balance : Rs. 2.00 lakh
  • Shares of companies : Rs. 10.00 lakh
  • Cash in hand : Rs. 1.00 lakh
  • Loan against property : Rs. 10.00 lakh
  • Loan against vehicle : Rs. 2.00 lakh
  • Personal loan : Rs. 3.00 lakh
What is the Net worth of Mr. X as on 31.12.2017?


Total Assets -

House Rs. 25.00 lakh + Plot Rs. 15.00 lakh + Jewellery Rs. 5.00 lakh + FDR’s Rs. 5.00 lakh + Mutual Funds Rs. 8.00 lakhs + Vehcile Rs. 10.00 lakh + Bank balance Rs. 2.00 lakh + shares Rs. 10.00 lakh + cash in hand Rs. 1.00 lakh = Rs. 81.00 lakhs

Total Liabilities-

Property Loan Rs. 10.00 lakh + vehicle loan Rs. 2.00 lakh + personal loan Rs. 3.00 lakh = 15.00 lakhs

Net worth = Rs. 81.00 lakhs – Rs. 15.00 lakhs = Rs. 66.00 lakhs


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