Reply to FYI: Don't include home equity in net worth

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[quote=Anonymous][quote=Anonymous]Net Worth = investments that make money like saving accounts, bonds, stocks, brokerage and rental property (just the net income).

Here's why. [b]NW is a calculation of assets that are making money for you. [/b]Your house is a cost center. Tax, repairs, ect. Even if you have equity, it still doesn't count because you don't really know what you'll earn until you get that check on closing day.

Feel free to argue all you want but it's true for financial planning purposes.[/quote]

This is factually inaccurate.  NW is a caculation of all assets minus all liabilities.  It's not a calculation of investments or interest bearing assets.  I don't understand why we have to have these posts every six weeks with a presumably new OP demanding that the definition of NW be ignored by everyone on Earth or redrafted to suit their preference instead of people just saying "I don't find NW as useful as invested assets, so that's the number I focus on in my planning".  [/quote]

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