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Net worth

If you live on village and have a farm, your spouse and children increase your net wealth as well because of larger human capital in a form of free working force. You may rent ‘em, too.

play it again, Sam

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Flashback wrote:

If you live on village and have a farm, your spouse and children increase your net wealth as well because of larger human capital in a form of free working force. You may rent ‘em, too.

Some of that sounds illegal. But it sounds like you’re now talking about your ability to generate income, not your current net worth.

My current net worth is the result of my past ability to create income. My future net wealth is a function of my current ability to create income by using all of my assets and resources.

play it again, Sam

lets say you’re worth a cool mil and your expenses are 200k - so 5X wealth multiple.

if your investment return are 5% and inflation on expenses is 4% how long can you live on the mil?

but if GNWM (GreenmanNetWorthMultiple) is at 20X then youre ballin

"You want a quote? Haven’t I written enough already???"

RIP

igor555 wrote:

lets say you’re worth a cool mil and your expenses are 200k - so 5X wealth multiple.

if your investment return are 5% and inflation on expenses is 4% how long can you live on the mil?

but if GNWM (GreenmanNetWorthMultiple) is at 20X then youre ballin

If I live off of powdered mac and cheese and share a studio apartment with 4 other people I become wealthy as ****.

As for home equity: why does it matter that the asset is illiquid?

Lots of companies have illiquid assets that are included in their net worth (i.e., equity) all the time.

Simplify the complicated side; don't complify the simplicated side.

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igor555 wrote:

lets say you’re worth a cool mil and your expenses are 200k - so 5X wealth multiple.

if your investment return are 5% and inflation on expenses is 4% how long can you live on the mil?

but if GNWM (GreenmanNetWorthMultiple) is at 20X then youre ballin

point taken. I guess I was assuming that your expenses (as a $ amount) were lower than your investment return (as a $ amount).  

82 > 87
Simple math.

7 pages later 0 data collected on net worth.

just change the topic from “net worth” to “how much cash and equities/bonds do you own?”

Tactics wrote:

7 pages later 0 data collected on net worth.

Already provided the correct answer in my first post (on the first page). 

#EndThread

S2000magician wrote:

As for home equity: why does it matter that the asset is illiquid?

Probably because it makes the asset (house) extremely hard to value. Your home is worth what someone will pay for it. If you have unlimited time to sell it, you could assign a higher value. If you had to sell it within five business days, it may only be worth half that.  

hashtag wrote:

Tactics wrote:

7 pages later 0 data collected on net worth.

Already provided the correct answer in my first post (on the first page). 

#EndThread

he means people have not thrown down their digits

 

"A theory that you can't explain to a bartender is probably no damn good."
- Ernest Rutherford

Sweep the Leg wrote:

S2000magician wrote:

As for home equity: why does it matter that the asset is illiquid?

Probably because it makes the asset (house) extremely hard to value. Your home is worth what someone will pay for it. If you have unlimited time to sell it, you could assign a higher value. If you had to sell it within five business days, it may only be worth half that.  

Plus, if you sell your house, where are you going to live?  

People say, “Well, my house is worth a million dollars!!!!   If I sell my house, I get a million dollars!!!  I bought it in 1962 for $28,000, and now it’s worth a million dollars!!!!  My house has appreciated to a million dollars!!!”  

What they fail to realize is that if they sell their house, where are they going to live?  All the houses in the neighborhood cost a million dollars.  So it’s not like they can sell their house and put a million dollars in their pocket.  (Unless they downsize/downgrade, which I’ve never known someone to successfully do voluntarily.)  

82 > 87
Simple math.

That is true. However, you can also look at it this way - if they did not have the house, they would have to pay $1 million to live in the place that they do currently.

“Visit the Water Cooler forum on Analyst Forum. It is the best forum.”
- Everyone

That is true. However, you can also look at it this way - if they did not have the house, they would have to pay $1 million to live in the place that they do currently.

“Visit the Water Cooler forum on Analyst Forum. It is the best forum.”
- Everyone

^And if you want to avoid taxation on the gains don’t you have to buy another house (or real estate) within something like 90 days?

Sweep the Leg wrote:

^And if you want to avoid taxation on the gains don’t you have to buy another house (or real estate) within something like 90 days?

also you don’t get taxed on your realized gains of up to $500k if you’re married

Be yourself. The world worships the original.

But you don’t have to buy another house for $1m, you can rent a house that would cost $1m. Think of it as a sale/leaseback… you get to pocket a lot of cash up front - I would think this could make a lot of sense for older folks who become cash strapped. On the other hand, you can just use traditional financing measures like HELOCs and mortgages… those would also have better tax characteristics presumably.

^Let me get this straight–you’re suggesting that a retired person sell their house (that is presumably paid for) and turn around and rent the house next door?  

82 > 87
Simple math.

^ It was more a stream of consciousness which at the time I thought made a bit of sense (I was analogizing it to corporate sale-leasebacks which happen all the time), but you can see by the end of the post I realized that other options make a lot more sense.

^So you’re suggesting that a retiree on fixed income take out a loan against their house, thereby increasing their monthly expenses and decreasing their disposable income?  

82 > 87
Simple math.

If they need the cash for a medical procedure and have no other assets to monetize, yes, that’s exactly what I’m suggesting.

reverse mortgage bros

"You want a quote? Haven’t I written enough already???"

RIP

when you start talking about expensive homes. renting is actually cheaper. at least thats what im getting on millionaire listing new york. great show btw.

Greenman72 wrote:

^Let me get this straight–you’re suggesting that a retired person sell their house (that is presumably paid for) and turn around and rent the house next door?  

I love my cheese. I got to have my cheddar.

Nerdyblop wrote:

when you start talking about expensive homes. renting is actually cheaper. at least thats what im getting on millionaire listing new york. great show btw.

Greenman72 wrote:

^Let me get this straight–you’re suggesting that a retired person sell their house (that is presumably paid for) and turn around and rent the house next door?  

haha that show is amazing/hilarious

"A theory that you can't explain to a bartender is probably no damn good."
- Ernest Rutherford

king_kong wrote:

If they need the cash for a medical procedure and have no other assets to monetize, yes, that’s exactly what I’m suggesting.

Exactly. It’s an asset they can tap into if they need to.

cj4g wrote:

king_kong wrote:

If they need the cash for a medical procedure and have no other assets to monetize, yes, that’s exactly what I’m suggesting.

Exactly. It’s an asset they can tap into if they need to.

Cj4g–what province are you, Ontario? I hear everyone in Toronto is a “millionaire” with housing prices there.

lp+p

lord of pensions and pilsner wrote:

cj4g wrote:

king_kong wrote:

If they need the cash for a medical procedure and have no other assets to monetize, yes, that’s exactly what I’m suggesting.

Exactly. It’s an asset they can tap into if they need to.

Cj4g–what province are you, Ontario? I hear everyone in Toronto is a “millionaire” with housing prices there.

lp+p

youre thinking of Vancouver, BC but i read somewhere that more than 50% of the home buyers there are from China. china china - in Trump tone lol

Be yourself. The world worships the original.

lord of pensions and pilsner wrote:

cj4g wrote:

king_kong wrote:

If they need the cash for a medical procedure and have no other assets to monetize, yes, that’s exactly what I’m suggesting.

Exactly. It’s an asset they can tap into if they need to.

Cj4g–what province are you, Ontario? I hear everyone in Toronto is a “millionaire” with housing prices there.

lp+p

I’m in the Boston province of Canada. I think it got officially absorbed shortly after Trump got elected.

Have you paid off your U of Phoenix loans yet?

cj4g wrote:

lord of pensions and pilsner wrote:

cj4g wrote:

king_kong wrote:

If they need the cash for a medical procedure and have no other assets to monetize, yes, that’s exactly what I’m suggesting.

Exactly. It’s an asset they can tap into if they need to.

Cj4g–what province are you, Ontario? I hear everyone in Toronto is a “millionaire” with housing prices there.

lp+p

I’m in the Boston province of Canada. I think it got officially absorbed shortly after Trump got elected.

Have you paid off your U of Phoenix loans yet?

I am very fortunate. I don’t have any debt, no mortgage on either of my homes, and never had student loans–I stuffed my investment accounts instead. I chose the right parents – I learned what wealth is from them.