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The video tutorial explains how to prepare a personal financial statement for loan applications to banks or lenders. The statement simplifies your entire financial picture onto one page, which may seem daunting at first. It utilizes a spreadsheet to organize your financial information effectively. The key formula presented is assets minus liabilities equals net worth. The spreadsheet guides you to input your name and date, followed by details of your assets, which include current bank balances, checking and savings accounts, certificates of deposit (CDs), and the value of stocks and bonds outside of retirement accounts. This structured approach makes calculating your net worth straightforward.
