In the case of the Palmers, it was critical to create a balance sheet — a snapshot of their wealth at a moment in time. The balance sheet reflects what they own (their assets), what they owe (their liabilities), and their net worth (the difference between their assets and their liabilities). A positive net worth indicates the Palmers own more than they owe. A negative net worth would indicate that they owe more than they own.
The Palmers' balance sheet reflected a negative net worth. There are many ways to increase net worth, but most center on the following tactics: Increase in assets from retaining income; Increase in assets from gifts or inheritance; appreciation in the value of assets; and decrease in liabilities through forgiveness.