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

Forum Index » Money and Finances

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

Subject:

Emoticons





More smilies

Text Color: Font: Close Marks

[quote=Anonymous][quote=Anonymous]I'm the one in "Net Worth Jail," a few comments above. While your home equity is an asset and officially counts towards net worth, I don't count it because I have no plans to ever draw money out of my house. I'm not going to borrow against it, use it as an investment property, or sell the property to increase my cash flow. The only thing I might do is sell it and invest the money in another primary residence which will be around the same or slightly higher price.

I see my home more as an avoidance of a cost than an asset. Without the mortgage, I will spend $1,500 a month on the condo fees, HOA, insurance, maintenance and repairs. To rent a similar place, it would cost $2,700 a month, so I've reduced my monthly expenses by $1,200 a month by owning.[/quote]

So you’re not going to sell it if you need to move into a retirement home? You aren’t going to leave it to anyone when you die? You have a clause in your will stating it shouldn’t be included as part of your estate, and instead should be left to rot?

You don’t have to use your home in retirement planning. You shouldn’t be calculating a 4% rule with its value. But there’s no debate that it should be included among your assets (and mortgage among your liabilities) in your net worth.[/quote]

Options

	Disable HTML in this message
	Disable BB Code in this message
	Disable smilies in this message

Review message

Search Recent Topics Hottest Topics