region2 said:
A little off the subject. But not really. I first thought I was a millionaire when my net worth broke a mil. I soon will be a millionaire II when my nest egg of taxable + tax deferred savings hits the mark. But, oh no, I recently read in Forbes magazine that you are not really a millionaire until your taxable savings (not including residence equity) hits a million. AAAAAAAAGGGGHHHH. I doubt if I will ever see that.
Yes, it's not part of this subject string, but you do bring up something that constantly crops up - that is "what you actually have"...
I look at it in a slightly different manner....
What if you were to apply for a job, and the base salary was $xxx. Would you ask the company what was the "net salary?" Of course not, since net is different for each indivudial.
Now, what if your "favorite brother in law" (or your father in law!) asked you how much you made last year? Would you quote your net (after taxes, deductions, 401k, IRA, etc, etc, etc?) Of course not! You would tell (either of them) your "gross salary".
For me, that's a "constant measurement". Some people on this thread are looking at the value of their home as a "non taxable holding". I don't. A home is somewhere where you "hang your hat" and regardless of the value, you still need somewhere to live. Therefore, it's not part of my "gross" or "net" "Net Worth". If I sell it (downsize, move to an apartment, move in with my father-in-law!) I'll add whatever value is left and add it to my net worth.
Unless you can "cash it in" tomorrow (regardless of being taxable, or non-taxable), I don't consider it in my calculation...
- Ron