Your Household Net Worth and Rate Yourself Against the Rest!

**krantcents** · 09-08-2014, 03:54 PM

I am 3 years away from retirement! I used the Fidelity calculator and I have more than enough to retire. I would rate my achievement A+.

**Reggie** · 09-08-2014, 04:51 PM

This is interesting but I'm not sure what the baseline number means. I am 40 years old, my husband is 45. He's worked 24 years and earns $135K or so including his pension. I've worked 18 years, I earn $120K. Is our number really 10,710,000??? Or should I have just used the highest years of working and added our salaries together? That would give me 3,720,000. This seems a little closer.

Assets
Homes - $500K
Autos/Bikes - $120K
401K - $500K
Pension - $50K annually + inflation ea yr.
Cash and stocks - $200K
Jewelry - $35K

I don't have any liabilities.

I have no idea how to value the pension. We will have it for the rest of our lives and it grows each year. We started collecting 2 years ago. It's basically what we live off of so it should be included somewhere...just not sure.

Anyway......I'm not even at 50% here and I'm 40 years old and worth $1.3m in just assets with no debt. But, for this, I don't rank that highly.

I must be doing it wrong.

**Eagle** · 09-08-2014, 06:16 PM

@ Reggie
I'm not sure how Singuy accounts for married couples in his proposed equation. How much have you and your husband made in 42 years? Assuming you've made 3,570,000 for example you'd be in the 36.4%.

A net value of over a million with no debt in your early to mid 40's seems really good to me.

**Eagle** · 09-08-2014, 06:17 PM

Originally posted by Singuy View Post

The annual net worth summary!

This year, lets add an equation in there.

This was developed by myself today due to boredom so it's not the end all be all! This is actually extremely hard to give a grade to. If your household income is too low, then you are naturally at a disadvantage(due to minimin amount of money required to live). Also if you have worked a really long time, your 401k's yearly earnings can surpass what you make by 10x..but that's why we call you the financial gods

To calculate net worth, add up: (House, Car, Jewelry, 401k, Cash, CDs, Bonds, Stocks, Business' Worth) - (Total liabilities).

Grade: Total Assets/(#years worked X gross income).

>100% you are a financial God!
80%-99% A+
65-79%: A
60-64%: A-
55-59%: B+
50-54%: B
45-49%: B-
40-44%: C+
35-39%: C
30-34%: C-
25-29%: D+
20-24%: D
15-19%: D-
<14%: F

Mine:
31yo

Assets

House: 670k
401k: 105k
Car: 38k

Liabilities:
80k mortgage

Income from 7 years: 850k

(813k-80k)/850k = 86%, A+

So you've worked 7 years total at 31?

**TBH** · 09-08-2014, 06:23 PM

Hmm, I'm also confused by the grading system, especially since my spouse and I are pretty far apart in age. So I'll take the grade out of it and give you my numbers.

Age: 37 and 51
Gross household income: about $85K, although our income varies a lot

Assets:
Home $250K
Rental property: $82K
Retirement accounts: $266K
Stocks, cash, college accounts: $139K

Liabilities:
Primary home mortgage: $167K
Rental property mortgage: $63K

Net worth: $507K

I feel like we're doing okay, although I wish we had more retirement savings and a smaller mortgage balance considering my spouse's age.

Oh, and I track my net worth here.

**Eagle** · 09-08-2014, 07:34 PM

I have worked 11 years and made about $417,360 during that time. My wife has worked sporadically and probably has made about $20k during the same time. She mostly volunteered I suppose. I'm going to count her as working maybe 1 year total.

Assets:
Cash, Vehicles, Laptops, Furniture $64,957
401k, Mutual Funds, Bonds, & Roth IRA $143,374
House $133,500
Total Assets $344,734

Debts:
Mortgage & Furniture 106,547
Total Debts $106,547

Assets - Debts = Net Worth or $238,187

I'm 32 and my wife is 31. She is a SAHM. We have 2 wonderful kids presently. Our goal is to have a net worth of over a million before we retire. We are about a quarter of the way there.

Assuming the grade should be net worth (assets - debts), so adjusted formula would be...

Grade: Net Worth/(# years worked X gross income over years worked)

238,187 / (12 * 417,360) = 4.73691%

According to Singuy's grading scale we are at 4.74% rounding up. Unless I'm doing the math wrong.

I think this formula is slanted towards those who haven't worked long in the workforce, are single, and are young.

**Singuy** · 09-08-2014, 10:08 PM

Originally posted by Eagle View Post

Grade: Net Worth/(# years worked X gross income over years worked)

238,187 / (12 * 417,360) = 4.73691%

According to Singuy's grading scale we are at 4.74% rounding up. Unless I'm doing the math wrong.

I think this formula is slanted towards those who haven't worked long in the workforce, are single, and are young.

Should be 238,187/417,360

You are way over 50%

**Singuy** · 09-08-2014, 10:09 PM

Originally posted by Eagle View Post

So you've worked 7 years total at 31?

Yup, started at 24yo. All school prior to that.

**Eagle** · 09-09-2014, 03:27 AM

Originally posted by Singuy View Post

Should be 238,187/417,360

You are way over 50%

Interesting Singuy. Ah okay. 238,187/437,360 so 54.46% or B/B+ then. Okay figured I was doing something wrong.

So the formula should be then...

Grade: Net Worth/ Gross income over years worked
Net worth = Assets - Liabilities
Gross income over years worked = Years worked * Average salary

Is that correct?

I use average salary because most people probably don't know exactly how much they made. Particularly the longer they have worked.

**Singuy** · 09-09-2014, 04:41 AM

Yes, most people ends up with raises and promotions so average would be the best. This equation is suppose to test how well people retain their earnings and how well they invest. People are severely punished if they spend every dime they make on interest and fun.

**Eagle** · 09-09-2014, 04:51 AM

Originally posted by Reggie View Post

This is interesting but I'm not sure what the baseline number means. I am 40 years old, my husband is 45. He's worked 24 years and earns $135K or so including his pension. I've worked 18 years, I earn $120K. Is our number really 10,710,000??? Or should I have just used the highest years of working and added our salaries together? That would give me 3,720,000. This seems a little closer.

Assets
Homes - $500K
Autos/Bikes - $120K
401K - $500K
Pension - $50K annually + inflation ea yr.
Cash and stocks - $200K
Jewelry - $35K

I don't have any liabilities.

I have no idea how to value the pension. We will have it for the rest of our lives and it grows each year. We started collecting 2 years ago. It's basically what we live off of so it should be included somewhere...just not sure.

Anyway......I'm not even at 50% here and I'm 40 years old and worth $1.3m in just assets with no debt. But, for this, I don't rank that highly.

I must be doing it wrong.

After understanding the formula better Reggie I believe Singuy's formula is about wealth retention. You have retained about 1/3 of your wealth for example.

**Eagle** · 09-09-2014, 04:55 AM

Originally posted by TBH View Post

Hmm, I'm also confused by the grading system, especially since my spouse and I are pretty far apart in age. So I'll take the grade out of it and give you my numbers.

Age: 37 and 51
Gross household income: about $85K, although our income varies a lot

Assets:
Home $250K
Rental property: $82K
Retirement accounts: $266K
Stocks, cash, college accounts: $139K

Liabilities:
Primary home mortgage: $167K
Rental property mortgage: $63K

Net worth: $507K

I feel like we're doing okay, although I wish we had more retirement savings and a smaller mortgage balance considering my spouse's age.

Oh, and I track my net worth here.

So your Net Worth is 507k. How long have you and your spouse worked? Maybe 45-50 years between the two of you? How much $ estimated have you guys made in your careers during that time?

Singuy's formula seems to be a grade on wealth retention.

**Reggie** · 09-09-2014, 05:03 AM

Ah ha. My salary will go WAY down. I was using current salaries and didnt average in the poverty years when DH was enlisted and I was working slave wages.

**corn18** · 09-09-2014, 05:31 AM

I'm at 10%. Kinda scary at age 48.

Your Household Net Worth and Rate Yourself Against the Rest!