Net Worth for the New Year
January 2nd, 2008 | by rocketc |The M-network and friends are posting about net worth today. Net worth is basically the difference between the positive side of the ledger (assets) and the negative side (debt). There are a lot of different theories on figuring net worth. I have included my house and “0% balance transfer” money. I am not going to reveal every single component of my asset to debt ratio, but without further ado. . . (drum roll ). . . heeerrre it is:
I am worth $2,590. Cash money.
We have assets totaling $197,740, but our liabilities stand at $195,150.
I don’t keep real close track of my net worth generally, but I was pretty shocked to learn that our net work is actually in positive territory. Of course, a lot of this depends on the worth of our home. I believe that we could sell our home for $4,000 more than what we owe for it - this might be an overly optimistic - but it helps my outlook on life to imagine that it might sell for that amount.
Some major drags on our net worth include:
- a car loan of $17,000 for a vehicle that is only worth $12,000
- a home equity loan of $16,000 for who knows what
- only $4,500 in retirement savings
Some positives include:
- our home - at least we have one and we are making the payments
- our retirement savings have doubled in the last year
- our IRS tax refund will probably double our net worth
If you want to read more articles on net worth, check out the following personal finance blogs:
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22 Responses to “Net Worth for the New Year”
By plonkee on Jan 2, 2008 | Reply
I had similar problems estimating the value of my house. In the end, I decided to assume it was worth what I paid for it 6 or 7 months ago. Similar houses (almost identical) in the area are on the market for about the same as they were when I bought, but I don’t know whether they are actually selling or not.
By rocketc on Jan 2, 2008 | Reply
That is probably the best way to do it. The real way to find out what your home is worth is to sell it.
I was unwilling to sell my house so that this post could be more accurate.
I think my estimate is fairly conservative.
By Mrs. Micah on Jan 2, 2008 | Reply
C’mon rocketc, I’m willing to get knocked up just to write a guest post.
By rocketc on Jan 2, 2008 | Reply
Now THAT’s funny!
We have had enough of that in our house for a while - three kids in 4 years will do very nicely.
I should get working on that guestpost, but I’m too busy taking care of kids. . .
By hank on Jan 2, 2008 | Reply
Yea - I had some trouble calculating my net worth also; but have found a handy dandy way to do it that has been working for me; It’s in the link, but basically looking at all the “estimate your house value” sites across the web and find that average, and you’ll get a pretty good estimate of what you’re ASSET side of your house is - yes the mortgage is still the LIABILITY, but it’s trouble enough watching that baby shoot your net worth down into the red… This keeps it closer to black.
Good post.
By My Dollar Plan on Jan 2, 2008 | Reply
That car loan, ouch. I’d be interested to hear that story sometime.
By rocketc on Jan 2, 2008 | Reply
@ my dollar plan: our loan is not entirely out of the ordinary. I think that most new car loans are similar - you owe far more than what you could actually sell the car for. That is why they make you buy “gap” insurance - if we total the car, the gap insurance pays for the difference between what you owe on the vehicle and what the ins company will give you for it.
It is a vicious cycle.