How Do YOU Calculate Your Net Worth?

**TheRootedNomad** · 07-25-2008, 08:55 PM

I want to say I know the "right" way to calculate net worth. In very simplistic terms you take all of your assessts and add them together. Then you take all of your debts and add them together. Then you subtract your debts from your assessts and you have your net worth.

I tabulate ours that way but I also tabulte it not cunting the house at all. Currently our house is a big chunk of our "real" net worth but as I don't plan on moving and will always have to live somewhere I don't like to count it. Since we have been working aggressively on paying down the mortgage that means our net worth looks a lot worse to me than it really is. However it's very motivational to see it go up.

Do you tabulate yours the "right" way or do you look at it differently?

**angrypuppy** · 07-25-2008, 10:17 PM

We do it the "right" way. Although it is not realized money until it is cash in hand. Also be realistic, when you figure equity you can get out of your home after a sale include all fees.

**dcompton** · 07-25-2008, 10:43 PM

I leave out my paid for car. It's not worth looking up the value and besides, one idiot running a red light and it could be scrap metal. It feels like a rather "fragile" asset so I don't count it.

**Greebo** · 07-26-2008, 07:01 AM

I do it the right way, including the cars. Cars depreciate, so when I bother to think about it, I go out to Kelly Blue Book and update the values downward. I also update the house values from Zillow even though it tends to be optimistic.

I include cars because a car is worth what its worth at the time, and while it's a relatively high risk item in terms of damage and loss of value, its still good now.

**TheRootedNomad** · 07-26-2008, 09:04 AM

Originally Posted by angrypuppy

We do it the "right" way. Although it is not realized money until it is cash in hand. Also be realistic, when you figure equity you can get out of your home after a sale include all fees.

I actually probably under estimate our equity when we do figure up our house. I use the square footage times the low sale price per square foot in the area. Then due to all of our half done projects I deduct about $20,000. I generally come up with a pretty low "as is" number. I can't wait until everything is complete and I can up the value.

**Telephus44** · 07-27-2008, 10:00 PM

I don't include the cars, but DH does. We don't own a house, but if we did, I'd include it. I'd probably count fair market value and not include fees, that's getting a little anal for me.

**missmanny** · 07-28-2008, 01:31 AM

lol - mostly I just add up how much I owe and then put a negative sign in front of it.

It gets less and less every month, eventually it will be in the positive teritory

**mom2three** · 07-28-2008, 04:28 AM

I do it the "right" way. I also add in our pensions which aren't accessible until we are 55, but they add a lot to our equity. It's nice to see a positive number as in Maexed Out I read that many mid thirties couples have NO equity.