Deficit Net Worth

Reviewed by Vineeth | Updated on Aug 27, 2020

Introduction

Deficit net worth is a financial scenario in which the liabilities of an individual outweigh the total assets owned.

Why Does Deficit Net Worth Occur?

Deficit net worth happens for various reasons. A deficit net worth typically occurs when the future or the current asset value slumps abruptly. A deficit net worth does not necessarily imply bankruptcy.

Highlights of Deficit Net Worth

  1. Deficit net worth occurs when an individual's total assets fall less than the liabilities.

  2. Deficit net worth can happen any time when the liabilities are more than assets.

  3. Deficit net worth does not always indicate bankruptcy.