Reply to Counting home value in net worth

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[quote=Anonymous][quote=Anonymous][quote=Anonymous][quote=Anonymous][quote=Anonymous]I see a lot of folks saying not to do this. IMO, the main issues would be whether a) you live in a very expensive home vs cheap home (or HCOL vs LCOL) and b) willingness to relocate or downsize in retirement. It's much easier to utilize the equity in an expensive multi million dollar house than a cheap 500k house for living purposes. If you live in a city like DC, NYC, SF you can easily find a bigger property in a cheaper area for a fraction of the cost. What's the harm in including a 3M townhouse in your NW if you intend to sell it eventually and downsize to a 500k property in another state (or country)?

I know some people can't imagine not living in a major city, but many of us are only here for economic opportunities and couldn't care less for the culture or amenities. [/quote]

This topic has been rehashed a thousand times here.

I personally don't since I live in a house valued at about $1m, with a $250K remaining mortgage. If I do choose to sell, I may net $650K which will go right into another house. Kinda pointless tracking value and mortgage balance year over year for things to net out.

If I were living in a house valued at $4M with zero mortgage AND I definitely plan on moving to a low cost area into a nice house worth $1M, then I would include the excess RE ($3M) in my net worth. Same goes for any rental properties.

The pedantic among us will always want to include primary residence as part of net worth and show the remaining mortgage as a liability, because "that's what the textbooks say". If that makes you happy, go for it. I have $10M+ financial assets so adding or not adding the $650K RE ain't gonna make my d*ck any bigger. But you do you.

[/quote]

It’s not pedantic. It’s correct.

You simply don’t care to do a net worth calculation, which is fine of course. I just don’t understand why you insist on pretending you’re calculating your net worth rather than whatever it is you’re calculating… [/quote]

Thanks for proving my point. As to why I don't care to include my RE, please re-read my post.[/quote]

Your point is that words have no meaning other than what YOU give them.

i.e. you don’t actually understand the meaning of the words “net worth”, but are too stubborn and/or stupid to admit that you’re wrong.

I guess that’s one way to “make your d*ck bigger”?[/quote]

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