Why do you feel that I ought to include my vehicle’s fair market value into my networth asset calculation? Curious as to your thoughts.

If I owned a luxury watch (a Rolex or Omega) with value in excess of $3,000, should I include the resale value of the watch into my net worth as well? What about the fair market value of my entire wardrobe and clothing apparels….what about my TV etc?

At this very moment, I’m still holding onto the remaining individual stocks, and index & mutual funds that I owned from a year ago. My losses are pretty tremendous (more than 50% down) so I’m just waiting out the market for now. In time I think the market will recover, but it’s hard to set a real timetable at this point.

Most of the funds I still own are foreign emerging market ones – Brazil, South Korea, Taiwan, China, and a few local SNP 500 tracking indexes etc. Mulling my investment options right now. It’s hard not to go with the most beaten down sectors – the financials and even oil stocks… choices, choices.

I wrestled with the decision but I ultimately decided that removing the vehicle asset figure provided a more accurate picture of overall networth, for many reasons.

In regards to the market value of ones home and its inclusion into net worth, there is indeed quite a hearty debate between some financial writers regarding the wisdom of including real estate into the calculation of personal networth for the same reasons I indicated in not including vehicle asset value into my calculations.

Frankly, I actually do see some merit in the argument that real estate SHOULD NOT be included into net worth as it frequently gives a false impression of true net worth. A home’s fair market value is incredibly difficult to spot price and it’s hard to know exactly how much a given property will ultimately sell on the open market. Inclusion of one’s home into net worth has even led to the coinage of the term “house rich” to denote those who’s primary net worth is derived from the value of their home alone. It’s frequently a misleading figure as true home value is frequently substantially lower than one may believe or hope. Just because a home is fairly priced at $400,000 doesn’t necessarily mean it will actually sell at that price, and may only fetch $350,000 when put on the market and scrutinized by prospective buyers.

However, with all that said, it’s hard not to deny that one’s primary home value still ought to be included into networth figures somehow. Its value is simply too large and substantial to ignore. Besides, after subtracting the mortgage from the home’s projected sale value, the home equity portion does have some liquid networth calculative value. Available home equity can be quickly converted into cash if need be.

The figures are indeed correct. Remember, these figures represent my current financial net worth compared to last month. Thus, my present total credit card balances are indeed at $104, but due to spending habit changes for the month of April compared to March, my credit card balances dropped -$2,780, a decrease of -96.39%.