What types of debts should be included when calculating financial liabilities?

To effectively calculate financial liabilities, all outstanding debts that a person is legally obligated to repay should be included. This encompasses a wide range of obligations beyond just credit card balances or personal loans from family and friends.

Including mortgages, student loans, and medical bills provides a comprehensive overview of an individual's financial obligations. Mortgages are often the largest debt individuals carry, and they typically have long repayment terms, significantly impacting an individual's financial health. Student loans can also be substantial and vary greatly in terms of repayment structures, making their inclusion essential in understanding one's overall financial picture. Medical bills, which can arise unexpectedly and accumulate relatively quickly, are another important category of debt that affects financial liabilities.

By recognizing the full scope of debts, individuals can make more informed decisions about budgeting, saving, and planning for future financial goals. In contrast, focusing on just a few specific types of debt, as suggested in other options, could lead to an incomplete assessment of one’s financial situation.