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Old 01-02-2013, 08:56 PM   #41
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How can net worth be computed? If the home is part of NW, the price you put on it is highly imprecise.
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Old 01-02-2013, 08:58 PM   #42
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Networth up 15% according to Quicken. Still working/accumulating/debt eliminating.

Of note - the $12k we put into the kids 529's doesn't count as net worth in my quicken model.

We do count the debt reduction (mortgage), but not the value of the house (since you can't spend a house and you have to live somewhere.) I'd rather not count on the "wealth" of my house. I live in Southern California- so it's theoretically worth a lot. But since I'm not selling, it's moot.

Our mortgage was reduced by 36k. (25k in extra payments the rest just regular P&I payments.)
Maxing out 401k and catch up contributions helped a lot.

Oh - and it doesn't count the 401k contributions in hubby's craptastic 401k. They haven't sent us a statement yet. (This is the plan I posted about with the outragious loads/fees). He's invested $5500 since he became eligable, and hopefully the company match will cover the loads. But it's not a lot of money in the overall picture.

All of this was from before updating quicken today. I like the numbers even better tonight, than I did Monday night.
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Old 01-02-2013, 09:01 PM   #43
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Up 16%. Of that, about 6% was new money, the rest was growth of the existing pile. (Didn't count the house--gotta live somewhere)
With broad US and Intl equity indexes up 16-18% for 2012, our portfolio looks like a bit of a laggard. Maybe our slight small/value tilt hurt a bit--I haven't seen a 2012 total return depiction broken out by M* style grid yet.

And, those old 3+% real-return I-bonds hurt us a bit, but I won't be parting with those until Uncle Sam confiscates them.
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Old 01-02-2013, 10:34 PM   #44
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All financial networth buckets up 11% (investment returns (stocks/bonds), savings, CD interest and Cash). This was after a BIG tax bite in December for tax estimates flowed out.

Not sure how to determine if there were any real increases in real estate and family business so I'll just leave it at that.
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Old 01-02-2013, 11:29 PM   #45
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How can net worth be computed? If the home is part of NW, the price you put on it is highly imprecise.
That certainly is one of the problem for things like real estate and some of the Angel investment I make. For real estate I take the higher of the county assessor or in my case an offer I have on one of my properties.

Anyway my networth increased by 5.3% +/- 2%.
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Old 01-03-2013, 12:06 AM   #46
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We don't have any real estate yet. Our cash and investments comprised NW went up 20.8%, from 306K to 370K. We are 33 & 35 w/ 2 toddlers, one income of $85K, and our expenditures for the year were 45K.

Not bad, but I was hoping to do better. My goal was 380K by the end of the year and we missed it by 10K.
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Old 01-03-2013, 12:27 AM   #47
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26.1% increase in NW in 2012 (including new saving contributions as well as investment portfolio growth). It's the last year of significant w*rk income (and aggressive saving) for me before RE in 2013, so I'm glad it was such a good year --- definitely has increased my confidence in being FI enough to pull the trigger!
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Old 01-03-2013, 01:08 AM   #48
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Total is up 22.6% for the year.
Contributions accounted for 5.2%.
Net gain is 17.6%
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Old 01-03-2013, 01:35 AM   #49
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Old 01-03-2013, 05:31 AM   #50
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8.36% (did not include any RE appreciation). Actually kind of surprised, 2012 was the first year living off of investments and it sure FELT like it was going to be a tough year but in the end everything worked out according to plan.
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Old 01-03-2013, 06:16 AM   #51
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13.7% We have paid off our mortgage and don't count our town home as an "asset" or part of our net worth.

I believe that an asset is something that puts money in your pocket, and a liability is something that takes money out of your pocket. A primary residence is in that second category, in my opinion.

If we sold & purchased another residence we would not have the money, if we sold & rented we would need the $100k+ to generate the income for rent.
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Old 01-03-2013, 06:32 AM   #52
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A house is part of your net worth worth whether it generates any income or not. Once you and spouse pass, your heirs will happily sell it for financial gain. When you sell it to buy another one, you will definitely see a "worth" appear in terms of financial transactions.

I suspect for most folks, they assumed no real gain for their home unless they had some concrete evidence otherwise. Thus the house would have been a drag in their % increase in 2012. We're not comparing totals here, just gains.

Now, just because a house is part of one's net worth, doesn't mean one should count it as part of the assets for a retirement fund and thus annual withdrawal rates. That may be the source of confusion.

If you just want to count growth in total "liquid" assets, fine. But your house is still part of your net worth.
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Old 01-03-2013, 07:00 AM   #53
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Now, just because a house is part of one's net worth, doesn't mean one should count it as part of the assets for a retirement fund and thus annual withdrawal rates. That may be the source of confusion.
+1. We have argued about whether to include home value in net worth in countless threads. To me it is a useless argument - the definition of net worth includes all assets - all liabilities so it counts. So in this thread I guesstimated the impact of home value on my gains for the year. But it is a completely academic exercise since portfolio value is what counts for withdrawal purposes. I do view the equity in my weekend house (and maintenance costs) as a potential bailout source of funds if things go south. But otherwise, the houses are just a source of annual expenses.
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Old 01-03-2013, 07:03 AM   #54
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Am totally delighted with a reduction in net worth of 3% for 2012.

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Net worth. A corporation's net worth is the retained earnings, or the amount left after dividends are paid, plus the money in its capital accounts, minus all its short- and long-term debt. Its net worth is reported in the corporation's 10-K filing and annual report.

Net worth may also be called shareholder equity, and it's one of the factors you consider in evaluating a company in which you're considering an investment.

To figure your own net worth, you add the value of the assets you own, including but not limited to cash, securities, personal property, real estate, and retirement accounts, and subtract your liabilities, or what you owe in loans and other obligations.

If your assets are larger than your liabilities, you have a positive net worth. But if your liabilities are more than your assets, you have a negative net worth. When you apply for a loan, potential lenders are likely to ask for a statement of your net worth.

Dictionary of Financial Terms.
It puzzles me that there seems no standard here for definition of net worth, or for income. If we ignore Social Security as a source of Income in one thread, but include it in another, it seems that it adds to confusion.

As an example... since beginning to accept Social Security at age 62, we have now collected (in today's dollars) about $350,000, a fairly significant amount, when one is not earning a salary.
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Old 01-03-2013, 07:09 AM   #55
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How do people determine the value of their homes for this calculation? Are sales and other costs considered?
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Old 01-03-2013, 07:22 AM   #56
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How do people determine the value of their homes for this calculation? Are sales and other costs considered?
Whatever the number is, it's probably out of date.

Since this thread just asked for change in net worth, the house thing shouldn't matter that much. Perhaps in future comparisons, the OP should ask for growth in net worth not including the house.

Some people probably just use the tax assessor value for their property taxes. Depending on where you live, those can be quite conservative.

If you are asking whether to include the costs associated with selling your house - no, just like you don't include the costs associated with selling your liquid assets (taxes, etc.). That's not how net worth is calculated. Costs associated with owning/maintaining a home are part of annual expenses, and aren't counted until they are spent.

I have my house value in Quicken, and have for many years. When I sold one in 2005, I put the money in a mutual fund where it appreciated until I bought another. When I bought another in 2010, I put a [very conservative] estimate back in Quicken.
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Old 01-03-2013, 07:30 AM   #57
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How do people determine the value of their homes for this calculation? Are sales and other costs considered?
I keep a conservative estimate of home value in my portfolio and net worth spread sheet based on similar houses that sold a couple of years ago. For this thread I made a guesstimate based on media reports (and observations) that home prices in my area have gone up over the course of 2012. But it was just for guessing -- I didn't bother to change the number in my spreadsheet. The numbers I carry are more for keeping in mind a rough, conservative figure of what would happen if DW and I die more than anything else.
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Old 01-03-2013, 07:32 AM   #58
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Am totally delighted with a reduction in net worth of 3% for 2012.



It puzzles me that there seems no standard here for definition of net worth, or for income. If we ignore Social Security as a source of Income in one thread, but include it in another, it seems that it adds to confusion.

As an example... since beginning to accept Social Security at age 62, we have now collected (in today's dollars) about $350,000, a fairly significant amount, when one is not earning a salary.
Huh?

Add up your bank accounts, your investment accounts, your real assets; subtract your credit card balances, any loans outstanding.

If you had saved all of the $350,000 you received in SS (i.e. not spent any of it) then it would definitely show up in your net worth. But money already spent or borrowed is not part of one's net worth.
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Old 01-03-2013, 07:37 AM   #59
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Heh. A "net worth calculation" thread and the year is only three days old.

Anyone want to lay odds on when the first "pay off the mortgage early" or "take SS at 62 or wait" threads will show up?
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Old 01-03-2013, 07:46 AM   #60
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Hey, someone wanted to know people's net worth change in 2012. Not surprised such a thread shows up right after "how did your investments do in 2012". Normal start of the year stuff.
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