Total current assets, also known as gross value, is what you owe to a business or the government, less what you have in your account. It’s the difference between what you owe them and what your current assets are. Your gross value account might include bank and retirement accounts, investments, vehicles, inventory, and more. It’s important to remember that any property you own, as well as stocks and bonds you may own, are included in your current assets.
When you think of your current value, it is usually easy to assume what the money you have is. But your current value may be different depending on how you define it and what is going out each month. Your gross monthly income may not be what you think it is, for example. Or your debts may not have changed since the last time you checked your account balance. To determine your current value, you need to add all of your current debts, including both secured and unsecured, to your current paycheck. This can include credit cards, store cards, money market accounts, and more.
Once you have your gross monthly income, minus your debts, minus your current expenses, what is your total current assets? You should have an idea of what your current asset value is, but you need to make sure it is higher than what you owe. If it is lower than what you owe, you need to know why.
Many people use their home as their main asset. This can be considered your total current assets because you actually own (mortgage paid, plus the appraised value of the home) and because you live in it. However, if you are renting, this is not your asset. In this case, you are only using what is available to you: your vehicle, the structure you live in, and the air conditioning or heating that you use.
Your current assets will be lower if you have joint accounts with another person. These are considered second property and the account is split between the two of you. For most people, this is a temporary situation and it usually gets resolved quickly. It is when a couple splits up and one spouse takes possession of the other’s asset that the issue arises. The account may still show as owned by the other spouse, even though they now control the asset.
Your current assets also include any current liabilities, such as credit cards, personal loans, unpaid taxes, and unpaid health insurance bills. Liability means what is owed to whom. Most commonly, liabilities are simply those you do not have any control over such as car loans, credit cards, medical bills, and so on. But these can also include unpaid tax debts, judgments, and other liens.
Lastly, the total current assets will include any retirement assets that you currently own. Usually, this includes any stock or mutual fund options you may have. Any retirement assets that you do not currently use will be zero dollars. Any money you invest in your retirement will be added to your total assets as assets grow. After retirement, your distribution can be made through any IRA funds you have chosen.
These are the four components of what is total current assets? All of your assets and liabilities will be included here, as will all of your retirement assets. You need to keep these balances as high as possible so that your taxes are as low as possible. After all, you will want to enjoy as many years of living expenses and eventual retirement as possible before you consider any withdrawals.