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Old 01-02-2016, 09:16 PM   #21
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Home equity is definitely part of net worth. So are the gold coins buried in the back yard.
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Old 01-02-2016, 11:54 PM   #22
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I would never trust a government entity with anything closer than a ball park estimate of my new worth. My ball park is not pee-wee T-ball, but a major league baseball park. I'll leave it up to you to figure out how much I would understate my net worth. I don't see any advantage to being more honest with a government pollster. While my retirement plan might assume a 50% cut in SS benefits AND a 100% increase in property taxes in the next 10 years with no change in my withdrawal rate, this is something I would never share with the government.
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Old 01-04-2016, 07:31 AM   #23
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Quote:
“People are not telling you what they actually believe in ordinary surveys,” Mr. Bullock said.
An article on surveys and a little money:
http://www.nytimes.com/2016/01/03/up...ur-answer.html
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Old 01-04-2016, 10:14 AM   #24
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So a two income couple retires with each receiving $75k in cola guaranteed pensions, and $36K in SS benefits. They rent a luxury condo on the water, lease a $150K car, yet their net worth by definition is $0.

It must be hell to have zero net worth, yet have to survive on close to $20,000 per month in retirement income..
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Old 01-05-2016, 07:44 AM   #25
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So a two income couple retires with each receiving $75k in cola guaranteed pensions, and $36K in SS benefits. They rent a luxury condo on the water, lease a $150K car, yet their net worth by definition is $0.

It must be hell to have zero net worth, yet have to survive on close to $20,000 per month in retirement income..

Fwiw, if i was calculating my net worth, i would include any permanent income stream by calculating it's PV like a consol bond. Granted you can't sell it, but nonetheless, thats the value you are deriving.


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Old 01-05-2016, 08:12 AM   #26
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One of my best friends has practically no net worth, yet lives very comfortably thanks to two excellent pensions and Social Security. He also has a large life insurance policy simply because he wants to leave something to his kids.

Net worth? For him it's completely irrelevant.
+100

That's my sister. Her and her husband both retired NYC police officers, then he got a job as head of security at a major NYC hospital and making a comfortable salary.
Always wanted a Manhattan condo so at 50 brought their dream condo on upper west side. Net worth I would say is probably not much if not negative.

Two city pensions plus retiree health care and a second salary and they are living extremely well. No kids, travel a bunch. lol tease my two sons that since they are their nearest relatives they better be nice if they want the condo when they die

This is all before Social security.
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Old 01-05-2016, 11:20 AM   #27
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For me, Net Worth is just a number for fun. It is not the number used in the FIRE formula. I also include home equity in NW. The numbers I include for FIRE calculations are Expenses, Income streams, and Investable assets.
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Old 01-05-2016, 12:59 PM   #28
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I've never understood where these types of calculators get their data. If I didn't have Quicken it would be easy to be off on my own net worth. It would take an awful lot of data mining to match accounts to individuals/couples/families, etc. to get to this. Income seems much easier, but net worth?
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Old 01-06-2016, 09:25 AM   #29
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The big question regarding net worth is that it SHOULD be measured by age group--that is, a sensible retiree/near retirement age should have many times the net worth of a 20-something just starting out.


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Old 01-06-2016, 09:57 AM   #30
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For me, Net Worth is just a number for fun. It is not the number used in the FIRE formula. I also include home equity in NW. The numbers I include for FIRE calculations are Expenses, Income streams, and Investable assets.
+1

My net worth is double my FIREcalc number. That's because I live in a ridiculously expensive real estate market. But I don't count my house except as plan B or C for long term care. My house is paid for, has reasonable taxes (thanks to Prop 13), is in an area I enjoy... It's not a hit to the budget - and I like living here. FWIW - my house is no great shakes... 50 year old tract home that would probably be a tear-down for a future buyer... but it's on expensive dirt.
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Old 01-06-2016, 10:20 AM   #31
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I really agree with you.. As we travel to resort towns-Aspen, Beaver Creek, Steamboat, Breckenridge (we live in CO)- all states have these areas with tons of multi-million dollar second (or third) homes.. There is so much wealth out there- and I really mean many, many with untold millions. That doesn't mean to say most aren't are just getting by- it just agrees that most don't tell their true worth.
Exactly, these surveys don't seem to access the truly wealthy. Our neighbourhood in Arizona is filled with 10,000 sq ft mansions worth several millions. These are second or third homes mostly. You can only imagine what their principle residences are worth. Granted, this would be a very small percentage of the population. Does tend to point out the bi-polar nature of wealth distribution.
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Old 01-06-2016, 10:25 AM   #32
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+1

My net worth is double my FIREcalc number. .
Same here. The other half is real estate and the capitalized value of my DB pension.
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Old 01-06-2016, 12:03 PM   #33
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Same here. The other half is real estate and the capitalized value of my DB pension.

My net worth certainly could benefit from adding my pension since it was over $2 million when I checked at retirement. But that seems fake to me. I just treat my pension as my monthly paycheck from a job that takes no skill and I cant get fired from.


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Old 01-06-2016, 12:33 PM   #34
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My net worth certainly could benefit from adding my pension since it was over $2 million when I checked at retirement. But that seems fake to me. I just treat my pension as my monthly paycheck from a job that takes no skill and I cant get fired from.


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Does that mean that if I were to buy an immediate annuity for $2M my net worth would immediately drop by that amount?
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Networth Article says $946K NW at 90 percentile
Old 01-06-2016, 12:39 PM   #35
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Networth Article says $946K NW at 90 percentile

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Does that mean that if I were to buy an immediate annuity for $2M my net worth would immediately drop by that amount?

Im not qualified to answer that because it will be years if ever that I have a 2 million net worth. .... Maybe I suffer from "you don't miss what you never had". If me (just my opinion) you take the cash out value of the annuity if you want want to determine net worth then. That may be a big haircut. Of course annuitants are not worried about net worth, I assume them to be worried about cash flow.
Now, I have saved quite a bit of my pension the past 5 years and I count that money as part of my net worth.


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Old 01-06-2016, 12:39 PM   #36
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I have no doubt they are accurate. Most people under 45 don't have pensions any longer (there are very few industries other than the public sector that haven't phased them out). People are not good about investing in their retirement until they actually need it, ie first comes their own student debt, cars, houses, marriage, kids, their kids college, their kids weddings and LASTLY oh yeh now need to save like crazy for retirement. The average income in America is $50k/household. Assuming a majority of that is needed to live on, so yeh, I wouldnt' expect more than $2-5k tops be saved away per year. Average home price is $200k, so even if you counted that in, it would just get you to the very low end of the range. In small town USA, you can find houses for $40k...for $80k, its actually pretty liveable. Granted health care, recreation, decent internet, decent schools, decent restaurants, shopping are all suspect.. but depends on what you think you need. I could move back to my home town and live off only SS if my house was paid off and many if not most do in that town. They may have $30-50k saved away for emergencies, but anyone with more than $100k is deemed "rich" by their standards.
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Old 01-06-2016, 12:44 PM   #37
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My net worth certainly could benefit from adding my pension since it was over $2 million when I checked at retirement. But that seems fake to me. I just treat my pension as my monthly paycheck from a job that takes no skill and I cant get fired from.


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+1. Just off the top of my head my net worth is way south of 1M. But, my monthly sit at home and do nothing and get sent money # is like 9K.
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Old 01-06-2016, 12:59 PM   #38
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+1. Just off the top of my head my net worth is way south of 1M. But, my monthly sit at home and do nothing and get sent money # is like 9K.

And the beauty of it is we cant make any stupid stock trades to destroy it either!


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Networth Article says $946K NW at 90 percentile
Old 01-06-2016, 01:29 PM   #39
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Networth Article says $946K NW at 90 percentile

Maybe I'm silly but I focus on whether we have enough to retire comfortably and about us being happy. What others have or don't have I don't care. It isn't us.

1. My in laws can buy $500k homes in Florida - I'm not sure I want to do that.
2. We drive three and five year old Toyotas and will likely keep them many more years. I don't need a BMW to let the world know "I have money - look at me."
3. My recipe for a good time: the sunshine pier, I two fishing rods, some bait, lawn chairs and a cooler. Oh and Blue skies would be nice.

How much do I need? Funny the nicest people are often of humble means.



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Old 01-06-2016, 01:38 PM   #40
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from your TKR post I would say you might need to cut thru the ice to catch those fish. Might need to elevate that leg too. Hope all goes well rayinpenn. BTW, I love my 15 yr old chevy truck.
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