Reply to Do you include your home equity in net worth ?

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[quote=Anonymous][quote=Anonymous][quote=Anonymous]I understand academically it’s part of our net worth. But when we discuss our “number” (to retire) we don’t include it because we need a place to live and it’s also not throwing off income. [/quote]

I count it because I could always sell it and rent instead.  Some assets that you own help you save money, but of course they are still convertible to cash.  And what if it was worth $25MM?  You would leave that off your net worth calc?[/quote]

Pointless hypothetical. I already said that I understand the term “net worth” and yes it’s in there. But when casually discussing things on DCUM I don’t include it because it is not part of what I’m counting on in retirement. If other people want to plan to sell their house and rent in retirement, they are free to do so. I don’t include my kids (substantial) college funds either because they are not available to me for use. So, when making casual remarks on DCUM when I say “We had X million dollars at 40” or whatever, I am not including home equity or college funds. My home equity is about 25% of my net worth ($1 out of $4M) but I still don’t think of it in my head because I’m always planning to live somewhere nice, or maybe two smaller places, unsure. Either way I don’t plan to invest that money outside of the real estate it currently is. [/quote]

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