Back above $3M

[brokrken]

Are most of the people on this thread including their home as part of their Net Worth? Some have explicitly included it.

OP here. Real estate equity is not included in the $3M for me

 

[Koolau]

OP here. Real estate equity is not included in the $3M for me

Right, we don't include personal RE in our "invested assets." We live here, so it's like we don't include our car or personal property in invested assets. Stuff we use, isn't invested.

I think most folks here do it the same way. Invested assets exclude personal property. YMMV

 

[luckydude]

Funny thing though, even though we're in La-La-Land, comparatively, I do find I'm still easily annoyed by some trivial expenses. For instance, I have a '67 Pontiac Catalina that's about to go in the shop for its annual checkover. It only gets driven maybe 800-1000 miles per year, and its belts and hoses look good, but I don't trust them, as they're getting up in age. Well, that kind of stuff isn't so easy to track down anymore, so the mechanic said if I ordered the parts, he'd put them on. Well, just between an upper and lower radiator hoses, a spring that goes in the lower to keep it from collapsing (apparently a common thing with older cars), an alternator belt and a power steering belt (a/c doesn't work, so no need for that belt), I was looking at something like $110!

Are simple maintenance parts really that pricey these days for most cars?! I realize the typical modern car uses one serpentine belt for everything, so naturally that's going to be pricier. But still...maybe it's longer ago than I think, but I swear I can remember when all those parts combined would've only been like $20-30!

Also, I guess being low volume parts these days, that probably raises production costs. After all, Pontiac quit building its own V8s since part way through the 1981 model year!

Still, I think it's odd that I can lose $10K when the stock market goes just slightly south, yet I'm quibbling over $110 in car parts!

I'll admit that sometimes I'm in the grocery store, and something I don't normally buy might catch my eye. My first impulse might be "I can't afford it" or "that's too expensive." But sometimes I'll catch myself and be like "Okay now, that extra $1.85 isn't going to bankrupt you!"

Even though we live in la la land, the old LBYM habit dies hard and still rears its head now and then

Even now DW still bugs me to use a coupon when I go to Del Taco to buy a combo meal. The coupon might give me free side fries, a medium drink or a $1 off purchase price. It takes me 3 minutes to dig up the coupon, pick the one I want and get a pair of scissors to cut it out---all just to save a buck. Yet we think nothing of spending $25k to take the kids to Japan for a 2-week trip next month. So the clipping coupon thing is rather silly in the grand scheme of things.

I think the market losses are a little different though. None of us have any control over market performance from day to day, so we just mentally accept market ups and downs as par for the course.

 

[Koolau]

Even though we live in la la land, the old LBYM habit dies hard and still rears its head now and then

Even now DW still bugs me to use a coupon when I go to Del Taco to buy a combo meal. The coupon might give me free side fries, a medium drink or a $1 off purchase price. It takes me 3 minutes to dig up the coupon, pick the one I want and get a pair of scissors to cut it out---all just to save a buck. Yet we think nothing of spending $25k to take the kids to Japan for a 2-week trip next month. So the clipping coupon thing is rather silly in the grand scheme of things.

I think the market losses are a little different though. None of us have any control over market performance from day to day, so we just mentally accept market ups and downs as par for the course.

By continuing to control what we can control, we help to make up for the results of those things we can't control. Besides, it still feels good to save money!

 

[dmpi]

Even though we live in la la land, the old LBYM habit dies hard and still rears its head now and then

Even now DW still bugs me to use a coupon when I go to Del Taco to buy a combo meal. The coupon might give me free side fries, a medium drink or a $1 off purchase price. It takes me 3 minutes to dig up the coupon, pick the one I want and get a pair of scissors to cut it out---all just to save a buck. Yet we think nothing of spending $25k to take the kids to Japan for a 2-week trip next month. So the clipping coupon thing is rather silly in the grand scheme of things.

I think the market losses are a little different though. None of us have any control over market performance from day to day, so we just mentally accept market ups and downs as par for the course.

Almost all of us LBYM, I started because my parents lived like that. But the difference is with a lower-middle class income and four kids they had to live like that to survive. I don't have to but I still live LBYM because it's actually more fun, mentally stimulating and challenging to live like that. It's still a thrill to get a good deal. Don't let having money take that away from you.

 

[street]

Even though we live in la la land, the old LBYM habit dies hard and still rears its head now and then

Even now DW still bugs me to use a coupon when I go to Del Taco to buy a combo meal. The coupon might give me free side fries, a medium drink or a $1 off purchase price. It takes me 3 minutes to dig up the coupon, pick the one I want and get a pair of scissors to cut it out---all just to save a buck. Yet we think nothing of spending $25k to take the kids to Japan for a 2-week trip next month. So the clipping coupon thing is rather silly in the grand scheme of things.

I think the market losses are a little different though. None of us have any control over market performance from day to day, so we just mentally accept market ups and downs as par for the course.

Ohhh yeah!! I see our frugal ways just like yours. A very hard habit to break. Lol

 

[Koolau]

Almost all of us LBYM, I started because my parents lived like that. But the difference is with a lower-middle class income and four kids they had to live like that to survive. I don't have to but I still live LBYM because it's actually more fun, mentally stimulating and challenging to live like that. It's still a thrill to get a good deal. Don't let having money take that away from you.

I agree but am slowly loosening the purse strings. I still want to be frugal, but I want to "get rid" of my money. I find the most joy in giving to my charities and my kids. For DW and me - we're still stuck in the LBYM mode for the most part. We'll likely die with more than we ever needed. YMMV

 

[bonvoyage]

Curious about this thread. Curious when you hit:
1M
2M
3M

1M about 2010
2M about 2012
3M about 2014

My wife and I both had a very non-linear salary curves we really started making good money about 12 years ago, relatively late in our careers. I retired happily at the end of 2020 but my wife is still working as she enjoys her work.

 

[Koolau]

Most of us find that subsequent M's are easier to get than the very first one! YMMV

 

[Ronstar]

Climbing the M's is ok as long as I don't have to work for it or cut spending. I'm not going to refrain from some BTD's just to pass another M. More money becomes less important as I get older - passing another M is not something I track or yearn for. It's all about health and happiness at this point.

 

[rmorris50]

Are most of the people on this thread including their home as part of their Net Worth? Some have explicitly included it.

Absolutely i include my house and mortgage in my NW calculation. NW is a mostly cut and dry calculation. But I don’t assume my house produces/raises any cash in my retirement cash flow analysis. Which could happen if one were to sell, rent, or utilize a HELOC or reverse mortgage as examples.

 

[Koolau]

Absolutely i include my house and mortgage in my NW calculation. NW is a mostly cut and dry calculation. But I don’t assume my house produces/raises any cash in my retirement cash flow analysis. Which could happen if one were to sell, rent, or utilize a HELOC or reverse mortgage as examples.

For the purposes of what my heirs and designated charities will inherit, I would include my personal dwelling as part of my NW. For purposes of my invested funds, my personal dwelling doesn't count IMHO. But as always, YMMV.

 

[RenoJay]

Congrats. I remain confused why people exclude real estate from net worth. If I’m a renter with a million in the stock market I have a million dollar net worth. If I exchange that money from stocks to a house, did my net worth really just drop to zero?

 

[Koolau]

Congrats. I remain confused why people exclude real estate from net worth. If I’m a renter with a million in the stock market I have a million dollar net worth. If I exchange that money from stocks to a house, did my net worth really just drop to zero?

Okay, I'll answer that question for me, personally.

I lived on the mainland and also owned a condo in Hawaii. I rented out the condo and lived in the house on the mainland. My NW as I calculated it while living on the mainland counted 0.0 for the house on the mainland but full value for the Hawaii condo (it was an investment as I was receiving rent for it.) When I moved to Hawaii and lived in my condo, my NW dropped by the previous value of the condo (I was now living there and NOT receiving rent.) My NW also went UP by the amount of the value of the house on the mainland (I quickly sold it and the "value" was the amount of money I received from the sale.)

SO, in essence, changing my living status "lowered" my NW. That's the way I look at NW - except as mentioned, for the purpose of inheritance. YMMV

 

[street]

Climbing the M's is ok as long as I don't have to work for it or cut spending. I'm not going to refrain from some BTD's just to pass another M. More money becomes less important as I get older - passing another M is not something I track or yearn for. It's all about health and happiness at this point.

Yep yep, I'm 100% with you on that. My working days are over and working hard to get to ER, so what growth I accumulate now has to come on its own.

Health is way higher on my list than money, way higher!!!!

 

[COcheesehead]

Congrats. I remain confused why people exclude real estate from net worth. If I’m a renter with a million in the stock market I have a million dollar net worth. If I exchange that money from stocks to a house, did my net worth really just drop to zero?

People confuse net worth and investment assets. Net worth has a very precise definition and it includes your home. Investment assets can be more fuzzy, but usually are what you have in your bank, brokerage, investment RE, etc.

 

[NgineER]

This is our net worth evolution since we both started working in 2007 after graduate school. DW retired in 2013 with the arrival of our third kid. First rental purchased in 2015 and started renting it in 2016.
Second rental purchased at the end of 2016, third at the beginning of 2017. Fourth rental purchased in 2018 and fifth in 2019.

 

[street]

This is our net worth evolution since we both started working in 2007 after graduate school. DW retired in 2013 with the arrival of our third kid. First rental purchased in 2015 and started renting it in 2016.
Second rental purchased at the end of 2016, third at the beginning of 2017. Fourth rental purchased in 2018 and fifth in 2019.

You have done well for not that many years in the work force. Great job!!!!

 

[W2R]

OK, big reveal never before admitted on the ER Forum:

I don't have anywhere near $3M, even including my house and contents, and car.

But that is more than enough; it doesn't cost a whole lot for one elderly woman with no dependents to live a very enjoyable life in the US, in an average cost-of-living location like New Orleans.

OK, if inflation goes absolutely bonkers then I might change my mind. But so far all is well.

 

[NgineER]

You have done well for not that many years in the work force. Great job!!!!

Thanks Street - nose to the grindstone for now. With four kids to put through college and a very conservative wife I plan to work until I hit 55 in seven years. Hopefully the magic of compounding and additional savings will allow us to loosen our purse strings a bit now and still retire comfortably at that time.

 

[brokrken]

I don't have anywhere near $3M, even including my house and contents, and car.

Yes, the number certainly doesn't matter as much as how that number relates to your expenses. Many people have super long happy retirements with much less.

 

[W2R]

Yes, the number certainly doesn't matter as much as how that number relates to your expenses. Many people have super long happy retirements with much less.

You are so right! And as for me, I think I'm probably the happiest retiree on the forum, or one of the happiest.

When I was 13, my mother told me "These are the best years of your life". Yikes. I was dealing with mountains of homework that I had to do after bedtime under the covers using a flashlight until the wee hours of the morning. I also had to deal with mean girls at school, hours and hours of chores that I had to do after school, and big varsity football player brothers who thought it was entertaining to beat me up and listen to me squeal. Those were definitely NOT the best years of my life, Mom!!

But my years in retirement have more than made up for all that. The older I get, the better my life becomes. Everything now is just as I'd always dreamed it might be some day. And that's the honest truth, for me anyway. I'm so glad that I made it to 75 already, and hope to live many more years.

 

[street]

Yes, the number certainly doesn't matter as much as how that number relates to your expenses. Many people have super long happy retirements with much less.

I may also to add to your comment. Yes, many live a great retirement with not even close to 3 million. I know a lot of them and are as happy as a lark.

 

[Koolau]

This is our net worth evolution since we both started working in 2007 after graduate school. DW retired in 2013 with the arrival of our third kid. First rental purchased in 2015 and started renting it in 2016.
Second rental purchased at the end of 2016, third at the beginning of 2017. Fourth rental purchased in 2018 and fifth in 2019.

That is truly impressive! I don't think you will need to wait until 55 to retire.

 

[F.I.R.E User]

I was at $617k all time high in Oct 2021 but have not matched that since. Although I am very close.