How to Figure Net Worth When You Have Pensions
A higher net worth makes you a more attractive client to lenders. Your net worth, indicated on your personal financial statement, is the difference between your assets and liabilities. Your assets include everything you own including your cash inflows. If you have a pension, this increases your inflows and inflates your net worth. To accurately represent your pension, you must determine the entire amount payable over the years following your retirement.
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Instructions
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Calculate your annual pension. If you receive $2,500 per month, multiply that figure by 12 to determine that your pension is $30,000 per year.
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Multiply your annual pension by 15. This represents life expectancy after retirement at age 65. While not an exact number, it works as an average value for calculating the total amount of your pension. If your pension is $30,000 per year for 15 years, your pension is worth $150,000
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Indicate your total pension value on the assets portion of your personal financial statement. By including this figure in your assets, your net worth will increase after subtracting your liabilities from your assets.
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