Welcome to City-Data.com Forum!
U.S. CitiesCity-Data Forum Index
Go Back   City-Data Forum > General Forums > Economics > Personal Finance
 [Register]
Please register to participate in our discussions with 2 million other members - it's free and quick! Some forums can only be seen by registered members. After you create your account, you'll be able to customize options and access all our 15,000 new posts/day with fewer ads.
View detailed profile (Advanced) or search
site with Google Custom Search

Search Forums  (Advanced)
 
Old 12-24-2015, 02:26 PM
 
105,693 posts, read 107,682,511 times
Reputation: 79324

Advertisements

i do see her point though . as an example 400,000 long island baby boomers and millennial's said in a study they intend to sell their expensive long island homes down the road and relocate in cheapsville .

as you can see they are planing on having lots of money left after selling . but if things plunge they could be disappointed .

but on the other hand they may be able to get a better deal in cheapsville if they rolled back too . .

but that does not change the fact on paper or not you worth is what it is on any given day , selling assets or not
Reply With Quote Quick reply to this message

 
Old 12-24-2015, 02:29 PM
 
14,250 posts, read 17,848,223 times
Reputation: 13807
Quote:
Originally Posted by mathjak107 View Post
i do see her point though . as an example 400,000 long island baby boomers and millennial's said in a study they intend to sell their expensive long island homes down the road and relocate in cheapsville .

as you can see they are planing on having lots of money left after selling . but if things plunge they could be disappointed .

but on the other hand they may be able to get a better deal in cheapsville if they rolled back too . .

but that does not change the fact on paper or not you worth is what it is on any given day , selling assets or not

So home values can fluctuate just like any other asset class. I don't see that as a reason for excluding them from net worth.

When my mother passed away (in the UK) I can assure you that the tax man included her home when calculating net worth for inheritance tax purposes.
Reply With Quote Quick reply to this message
 
Old 12-24-2015, 04:55 PM
 
Location: NJ
31,771 posts, read 40,468,370 times
Reputation: 24590
Quote:
Originally Posted by petch751 View Post
But that's what many people did. They were told they're net worth was higher, (higher equity in their homes) so they used their house as banks and took out 2nd mortgages. When the housing market crashed their home value was lower than what they owed on 1st and 2nd mortgages so they were underwater.

Some people include home values in their net worth but that's based on projected value during a period of time. I understand this thinking but prefer to split it. If I have $1.2 million in cash an investments, hopefully the market doesn't crash and tomorrow that will be my net worth - money owed. Then because the home is harder to sell but does have equity I think of that different. They could tell me it's worth $500K but in a week market I may have to drop it to sell, then there's all the fees of selling.
net worth is net worth. you shouldnt modify an easily definable number because people dont understand how to make good financial decisions. those people should educate themselves (or you can try to educate them). dont try to change facts to accommodate the ignorant.
Reply With Quote Quick reply to this message
 
Old 12-24-2015, 07:02 PM
 
Location: SoCal
20,160 posts, read 12,657,481 times
Reputation: 16993
Even cash as in money market does fluctuate. It was less than a dollar in 2008. Or it could be zero too. I had to move large chunk of cash in 2008 so I know, there was no bank safe enough when you are over the limit.
Reply With Quote Quick reply to this message
 
Old 12-24-2015, 09:15 PM
 
Location: Spain
12,722 posts, read 7,488,348 times
Reputation: 22628
Quote:
Originally Posted by petch751 View Post
Be careful how you view your net worth. You are including paper appreciation, not realized appreciation.
So if I bought $10k in stock in 2009 that is now trading for $30k, is is actually only worth $10k since it is just paper appreciation? Nonsense. On any given day it would be worth what it is trading for, as would someone's house.

Quote:
Originally Posted by CometV6787 View Post
I would be curious to know how folks are factoring in taxes on tax advantaged accounts. Just looking at a balance doesn't tell the full story.
This has nothing to do with net worth, taxes are a variable expense you might as well factor in cost of beer against net worth.
Reply With Quote Quick reply to this message
 
Old 12-24-2015, 09:45 PM
 
13,811 posts, read 27,305,492 times
Reputation: 14244
In my neighborhood homes that are priced competitively sell sometimes in hours. Almost as good as stock at that point...
Reply With Quote Quick reply to this message
 
Old 12-25-2015, 06:25 AM
 
105,693 posts, read 107,682,511 times
Reputation: 79324
Quote:
Originally Posted by Jaggy001 View Post
So home values can fluctuate just like any other asset class. I don't see that as a reason for excluding them from net worth.

When my mother passed away (in the UK) I can assure you that the tax man included her home when calculating net worth for inheritance tax purposes.
i never said i would exclude them from net worth totals . IT CERTAINLY IS A PART .

i said it gets excluded from calculating what you can draw at retirement from your portfolio until such time as it is liquid . you can't spend the living room .

Last edited by mathjak107; 12-25-2015 at 06:40 AM..
Reply With Quote Quick reply to this message
 
Old 12-25-2015, 06:39 AM
 
105,693 posts, read 107,682,511 times
Reputation: 79324
Quote:
Originally Posted by NewbieHere View Post
Even cash as in money market does fluctuate. It was less than a dollar in 2008. Or it could be zero too. I had to move large chunk of cash in 2008 so I know, there was no bank safe enough when you are over the limit.
i lost money in 2008 in a money market that broke the buck
Reply With Quote Quick reply to this message
 
Old 12-25-2015, 09:23 AM
 
26,146 posts, read 21,368,471 times
Reputation: 22726
Quote:
Originally Posted by wheelsup View Post
In my neighborhood homes that are priced competitively sell sometimes in hours. Almost as good as stock at that point...
Not really. My house sold in four hours but still cost 8% or so in transaction/closing costs and took 30 days to close. It's really nothing like equities
Reply With Quote Quick reply to this message
 
Old 12-25-2015, 09:47 AM
 
105,693 posts, read 107,682,511 times
Reputation: 79324
our PA house took a year to sell .

the people we sold to 3 years ago just sold it for 50k less plus broker fees . took them 7 months . it does not matter what it's worth , only what someone is wiling to pay and how bad you want to sell.

on the other hand the 7 figure nyc apartments go like hot cakes . even at the peak of 2008's crash we sold 2 in a month for 10% less then the record high . but closing took 5 to 6 months because banks were reneging on the mortgage money .

Last edited by mathjak107; 12-25-2015 at 09:58 AM..
Reply With Quote Quick reply to this message
Please register to post and access all features of our very popular forum. It is free and quick. Over $68,000 in prizes has already been given out to active posters on our forum. Additional giveaways are planned.

Detailed information about all U.S. cities, counties, and zip codes on our site: City-data.com.


Reply
Please update this thread with any new information or opinions. This open thread is still read by thousands of people, so we encourage all additional points of view.

Quick Reply
Message:


Over $104,000 in prizes was already given out to active posters on our forum and additional giveaways are planned!

Go Back   City-Data Forum > General Forums > Economics > Personal Finance
Similar Threads

All times are GMT -6.

© 2005-2024, Advameg, Inc. · Please obey Forum Rules · Terms of Use and Privacy Policy · Bug Bounty

City-Data.com - Contact Us - Archive 1, 2, 3, 4, 5, 6, 7, 8, 9, 10, 11, 12, 13, 14, 15, 16, 17, 18, 19, 20, 21, 22, 23, 24, 25, 26, 27, 28, 29, 30, 31, 32, 33, 34, 35, 36, 37 - Top