It’s a frequently used term in almost every facet of life. An asset is anything that is owned by a person or a company that has economic value. Mainly, these are items that could be converted to cash. For example, if you have accounts receivables, office equipment, inventories, automobiles, securities and other property; these are considered your assets. When a balance sheet is viewed assets comprise of retained earnings, sum of liabilities, common stock and preferred stock.

On the other hand, if assets are viewed from an accounting perspective, they are divided in to several categories. These will include current assets which pertain to cash and other items that are liquid. When it comes to real estate and equipment, they belong to the category of long-term assets. When you have paid for a product or service in advance, it falls under the category of deferred and prepaid assets. Examples are insurance policies, interest, and rent. Lastly, items that are copy written under your person or firm, patents, trademarks, and even cash from good will are called intangible assets.

Majority of people have some kind of insurance that they use to cover their valuable possessions. For example, it is common to find individuals who have car insurance policies for their autos. For young professionals who rent apartments, they probably have renter’s insurance to protect their personal items. If you own your home, you’ve probably already applied for homeowner’s insurance. Some insurance carriers will allow the policy owner to receive the estimated worth of their property when the loss occurred. Then again, when it comes to homeowners insurance policies, they normally enable the insured party to collect the replacement value of the property which was lost.

Unless your residence contains something of extreme value for example, very high-tech electronics or luxury jewels, one doesn’t necessarily have to create a catalog for the insurance company. However, doing so would prove useful in reaching an estimated value for the coverage that the individual needs. After a tragedy like fire, it relieves the homeowner of the pressure of trying to remember everything that he or she owns. In an event like that, it’s good to have the information readily available. It might sound like an overwhelming task but follow these simple steps so all your assets can be accounted for.

Don’t list every object piece by piece. Instead, group them according to type. For example, go through all the rooms in your home and jot down all the furniture in one group. Later on, you can even add details like, which ones are antique pieces and so on. Listing by location also works. For some individuals, it is easy to account for objects since they know where they are placed. Additional information or documents, like receipts and other proofs of purchase, must also be attached to the appropriate list. This might come in handy for large and pricey items. Lastly, safeguard the list. Place it in a safety deposit box or in a container that is fire safe to ensure that it won’t be destroyed during a catastrophic situation.