Comments on: The Confusing Process Of Measuring Net Worth & Financial Progress http://www.savingadvice.com/blog/2007/05/08/101403_the-confusing-process-of-measuring-net-worth-financial-progress.html Bridging the gap between saving money and investing Tue, 24 Nov 2009 22:38:31 -0800 http://wordpress.org/?v=2.8 hourly 1 By: Queercents » Almost Debt Free: Confronting and Understanding the Purpose of Net Worth http://www.savingadvice.com/blog/2007/05/08/101403_the-confusing-process-of-measuring-net-worth-financial-progress.html/comment-page-1#comment-61470 Queercents » Almost Debt Free: Confronting and Understanding the Purpose of Net Worth Wed, 20 Jun 2007 04:36:38 +0000 http://www.pfadvice.com/2007/05/08/the-confusing-process-of-measuring-net-worth-financial-progress/#comment-61470 [...] you through the process quite nicely, and Teri Newton at Personal Finance Advice provides a more detailed and encompassing approach. Instead of echoing what others have said better, I’d like to make the subject of net worth more [...] [...] you through the process quite nicely, and Teri Newton at Personal Finance Advice provides a more detailed and encompassing approach. Instead of echoing what others have said better, I’d like to make the subject of net worth more [...]

]]> By: J at Home Finance Freedom http://www.savingadvice.com/blog/2007/05/08/101403_the-confusing-process-of-measuring-net-worth-financial-progress.html/comment-page-1#comment-48161 J at Home Finance Freedom Sat, 19 May 2007 14:34:54 +0000 http://www.pfadvice.com/2007/05/08/the-confusing-process-of-measuring-net-worth-financial-progress/#comment-48161 Hello. I agree that net worth is unhelpful but I also dislike counting imaginary income (future income). I posted "Biggest Net Worth Mistakes" (click my name link) a few days before this article, so feel free to visit and comment. Thank you. Hello. I agree that net worth is unhelpful but I also dislike counting imaginary income (future income). I posted “Biggest Net Worth Mistakes” (click my name link) a few days before this article, so feel free to visit and comment.

Thank you.

]]> By: What Is The Worth Of *Net Worth* If It Is Not Usable? http://www.savingadvice.com/blog/2007/05/08/101403_the-confusing-process-of-measuring-net-worth-financial-progress.html/comment-page-1#comment-47096 What Is The Worth Of *Net Worth* If It Is Not Usable? Wed, 16 May 2007 19:21:42 +0000 http://www.pfadvice.com/2007/05/08/the-confusing-process-of-measuring-net-worth-financial-progress/#comment-47096 [...] The Confusing Process Of Measuring Net Worth & Financial Progress by Teri @ Personal Finance Advice. [...] [...] The Confusing Process Of Measuring Net Worth & Financial Progress by Teri @ Personal Finance Advice. [...]

]]> By: James http://www.savingadvice.com/blog/2007/05/08/101403_the-confusing-process-of-measuring-net-worth-financial-progress.html/comment-page-1#comment-44473 James Wed, 09 May 2007 16:30:26 +0000 http://www.pfadvice.com/2007/05/08/the-confusing-process-of-measuring-net-worth-financial-progress/#comment-44473 Very well-written entry. Although dividing progress in 10 years by 10 is not entirely accurate. Wealth accumulation is a compounded growth, initially slow, then exponential increase. Very well-written entry. Although dividing progress in 10 years by 10 is not entirely accurate. Wealth accumulation is a compounded growth, initially slow, then exponential increase.

]]> By: green http://www.savingadvice.com/blog/2007/05/08/101403_the-confusing-process-of-measuring-net-worth-financial-progress.html/comment-page-1#comment-44435 green Wed, 09 May 2007 13:54:31 +0000 http://www.pfadvice.com/2007/05/08/the-confusing-process-of-measuring-net-worth-financial-progress/#comment-44435 This article is very helpful for calculating my net worth and organizing things that effect worth. This article is very helpful for calculating my net worth and organizing things that effect worth.

]]> By: samerwriter http://www.savingadvice.com/blog/2007/05/08/101403_the-confusing-process-of-measuring-net-worth-financial-progress.html/comment-page-1#comment-44224 samerwriter Wed, 09 May 2007 00:26:03 +0000 http://www.pfadvice.com/2007/05/08/the-confusing-process-of-measuring-net-worth-financial-progress/#comment-44224 Check out the wealth score: http://moneycentral.msn.com/content/Savinganddebt/Savemoney/P81023.asp By taking into account both your net worth and your lifetime earnings, it implicitly considers your spending habits as well (the less you spend, the more you'll be saving). Check out the wealth score:
http://moneycentral.msn.com/content/Savinganddebt/Savemoney/P81023.asp

By taking into account both your net worth and your lifetime earnings, it implicitly considers your spending habits as well (the less you spend, the more you’ll be saving).

]]> By: Debbie http://www.savingadvice.com/blog/2007/05/08/101403_the-confusing-process-of-measuring-net-worth-financial-progress.html/comment-page-1#comment-44145 Debbie Tue, 08 May 2007 20:13:01 +0000 http://www.pfadvice.com/2007/05/08/the-confusing-process-of-measuring-net-worth-financial-progress/#comment-44145 This entry is awesome. I have been looking at issues like these for many years. I love that idea of measuring your progress based on your spending rather than your earnings (though it's harder to calculate) and I like the other website's equation and progress chart (though I want to retire much earlier). I ended up making my own chart based on income and the assumption that I had saved 15% of my income (which is what millionaires supposedly do) and got old income numbers from the IRS mailing, but I like your plan better. It makes more sense, and your numbers look better if you find ways to spend less! I also like your thoughts on including your house value in your net worth. I ended up deciding I want to track three measures of net worth! Two of them are the same as yours. But some of my money is in a pension. I include the money that I can withdraw as part of my net worth, but in real life it is unlikely that I will ever actually withdraw that. I can keep track of how that is impacting my financial future by reading the latest policies on my pension plan! One of my big goals is early retirement, even if this pension plan gets ruined. So for my third measure, I look only at retirement savings minus the amount in my pension plan. I like your idea of using your house purchase price in your net worth equation, but not quite enough to steal it. For a while I was using zillow.com, but then I decided that those values seemed a bit high. My compromise is to use the estimate provided by my tax assessor, which I suspect is a bit low. It still fluctuates, but now that my house is worth double what I paid for it, it seems more reasonable to me than using the purchase price. I also use a spreadsheet. I really like to graph my progress and I like to compare that to my ideal progress with another line on the same graph, so I recommend that. This entry is awesome. I have been looking at issues like these for many years.

I love that idea of measuring your progress based on your spending rather than your earnings (though it’s harder to calculate) and I like the other website’s equation and progress chart (though I want to retire much earlier).

I ended up making my own chart based on income and the assumption that I had saved 15% of my income (which is what millionaires supposedly do) and got old income numbers from the IRS mailing, but I like your plan better. It makes more sense, and your numbers look better if you find ways to spend less!

I also like your thoughts on including your house value in your net worth. I ended up deciding I want to track three measures of net worth! Two of them are the same as yours. But some of my money is in a pension. I include the money that I can withdraw as part of my net worth, but in real life it is unlikely that I will ever actually withdraw that. I can keep track of how that is impacting my financial future by reading the latest policies on my pension plan! One of my big goals is early retirement, even if this pension plan gets ruined. So for my third measure, I look only at retirement savings minus the amount in my pension plan.

I like your idea of using your house purchase price in your net worth equation, but not quite enough to steal it. For a while I was using zillow.com, but then I decided that those values seemed a bit high. My compromise is to use the estimate provided by my tax assessor, which I suspect is a bit low. It still fluctuates, but now that my house is worth double what I paid for it, it seems more reasonable to me than using the purchase price.

I also use a spreadsheet. I really like to graph my progress and I like to compare that to my ideal progress with another line on the same graph, so I recommend that.

]]> By: Matt http://www.savingadvice.com/blog/2007/05/08/101403_the-confusing-process-of-measuring-net-worth-financial-progress.html/comment-page-1#comment-44133 Matt Tue, 08 May 2007 19:15:21 +0000 http://www.pfadvice.com/2007/05/08/the-confusing-process-of-measuring-net-worth-financial-progress/#comment-44133 I don't put much stock in that equation that is supposed to tell you what your net worth should be. I'm only two years out of college and it tells me that my net worth is supposed to be $220,000. I haven't earned that much money over the course of my entire life, let alone been able to save and invest it. I don’t put much stock in that equation that is supposed to tell you what your net worth should be. I’m only two years out of college and it tells me that my net worth is supposed to be $220,000. I haven’t earned that much money over the course of my entire life, let alone been able to save and invest it.

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