House is an asset?

[simpleyme]

I am happy now. I am not realizing that my tens of thousands of dollars in computer equipment and other toys are assets as well. I am slowly working on my home inventory and realizing each day I add more to the program my net worth goes up another few grand. This is exciting.

its not a popular idea but if I was to put a value on my things I would pretend I was having a yardsale and think what I could sell this stuff for

I track my networth but I do not include my houshold stuff

[reptile411]

Should it not be included to determine your entire net worth? The financial software thinks its important. I never gave it any thought until I saw this option in the software.

[simpleyme]

I do not ,but i am sure a lot do It is stuff you own so I think technicaly you should
I think it inflates the look of networth which is not what I am after I do a low value on everything to get my worst case scenerio networth (taxed assessed values on properties,low bluebook on cars that type of thing)
I think everyone tracks their own way ;-)

[disneysteve]

When I do my net worth, I include only financial assets. I don't include stuff - cars, furniture, collectibles, clothing, jewelry, etc. It is far too difficult to value those items accurately and the values are constantly changing. I stick with things with clearly identifiable value - stocks, bonds, mutual funds.

[reptile411]

That brings up a good point on net worth. Do we include any businesses we own in our personal net worth? If so how do we do such a thing? using sales forecasts or???????????????? I mean as everyone knows the sales forecast for any business is not near what it was a few years ago. Its always changing so how do we value a business we own?

[creditcardfree]

Documenting your personal property in the case of an insurance claim could be quite valuable. My parents had a pipe break in their home and beside the damage to the home the was damage to various personal property. Each item had to be looked at by a claims adjuster. In the case of a fire, a video or pictures, showing just what you did own, could be very valuable.

[Broken Arrow]

That brings up a good point on net worth. Do we include any businesses we own in our personal net worth?

That is a terrific question! In my mind the answer is definitely "Yes".

But how to value it? That part, I am not sure. What about the bottom line from last year? You know, revenue minus overhead of 2008?

[kork13]

That brings up a good point on net worth. Do we include any businesses we own in our personal net worth?

As BA said, absolutely YES. So many billionaires with a net worth most of us could only dream about have most of their net worth in the form of real estate and/or businesses.

That is a terrific question! In my mind the answer is definitely "Yes".

But how to value it? That part, I am not sure. What about the bottom line from last year? You know, revenue minus overhead of 2008?

This is (literally) the million-dollar question. Here's an article touching on how Mr. Trump goes about it: Trump on Trump: Testimony Offers Glimpse of How He Values His Empire - WSJ.com

[reptile411]

Mr Trump is someone I love to hate. No doubt he is worth a pretty penny but always seems to have some sort of financial problems. I think he knows how to make it but not how to manage it. Almost ashamed to call him one of my idols. Kiosaki is another. A great mind, What I would not give for a few hours of picking his mind. Things really turned around for me after I read his book Rich dad poor dad. Its amazing at how simple making, having and enjoying money can be. It hits you right in the face when you realize "Why didn't I think of that" Trump knows his business. I would take Real Estate advice from him "I did when buying our home" I however would have a hard time not laughing at his financial advice.

[Seeker]

Actually, I wouldn't consider computer(s) to be an asset per se. They're almost like autos in the sense that they are outdated and worth less (usually) as soon as purchased. Technology just moves forward so quickly.

[LivingAlmostLarge]

I like my home but it's not a good investment. It is an asset, but boy does it suck.

[maat55]

As I've posted many times, you should not consider your house to be an investment at all. It is a purchase, not an investment. An investment is something you buy with the intent of making a profit. That doesn't describe your home. You bought your home in order to have a place to live. I don't care if the value of my home goes up, down or sideways. As long as I can continue to live here, I'm happy. Yes, I hope that someday when I sell it, I at least get back what I paid, but that wasn't my purpose for buying it.

True, other than those who sell to move into nursing homes, you will usually only get cash from your house during a downsize, which will usually not be much.

At best you end up with a rent free home but still have the upkeep, insurance and taxes.

Not thinking of your home as an investment is very wise. Same with not thinking that SS should be part of your retirement. These two mindsets encourage me to invest more aggressively towards my nestegg.