The value of human capital

Dr. Moshe A. Milevsky, author of Your Money Milestones and tenured finance professor at the Schulich School of Business at York University in Toronto, Canada, had his class perform an exercise at the beginning of his twelve-week undergraduate course on the topic of wealth management. He asked his students to prepare their own personal balance sheet.

As he admits in his book, the financial status of a twenty-something looks much different from somebody in her thirties or forties. Assets are few and far between. And where they exist, they're minimal. But liabilities include loans, student loans, and even credit card debt.

After the class filled out their personal balance sheets, he asked them to compute their net worth by subtracting their assets from their liabilities. The results were bleak.

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