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Started By
Message
re: Excluding home equity, the median 40-44 year old has a net worth of just $58,000
Posted on 1/8/24 at 7:38 pm to stout
Posted on 1/8/24 at 7:38 pm to stout
quote:
Then what?
There are countless things you can do with a Heloc as once you draw down on it, it is literally money which I am sure you are aware.
1
Posted on 1/8/24 at 7:39 pm to Big Scrub TX
Because if you sell your house, you have to buy a new one. It's only cash value unless you die and it goes to heirs.
Posted on 1/8/24 at 7:43 pm to PhiTiger1764
quote:
There are countless things you can do with a Heloc as once you draw down on it, it is literally money which I am sure you are aware.
I understand that and get what you are trying to get at. Yes equity can be accessed but you still have to pay it back or you are homeless.
My point is two things.
1. People don't save money
2. You should not be overly reliant on your home equity for many reasons. I listed a few already. There are more.
Posted on 1/8/24 at 7:45 pm to stout
you'll work until you die
AND LIKE IT
AND LIKE IT
Posted on 1/8/24 at 7:46 pm to stout
58k after 15 years with no additional investment would be 140k assuming 6% ROI.
The median net worth for 55-59 year olds (excluding home equity) is 130k.
Gen X is really killing it.
The median net worth for 55-59 year olds (excluding home equity) is 130k.
Gen X is really killing it.
Posted on 1/8/24 at 7:46 pm to El Segundo Guy
quote:
Because if you sell your house, you have to buy a new one.
I figured more would get this. Guess not.
Posted on 1/8/24 at 7:47 pm to Powerman
quote:
. I could probably take a few pointers
It helps that we live a little outside of the city. It's a 20 minute commute for me and less for my wife. We also bought our home in 2006 for a good price and we're staying there forever. We've never bought a brand new vehicle, take vacations every other year. No credit card debt. I'm not into fishing or 4 wheelers. No student loans thanks to the GI Bill.
I also had it beat into my brain by my parents to save money as a young kid. I didn't listen until I was about 21 and started saving $200+ every month and have done that faithfully since. It's helped with down payments, private school tuition and the times we were in a bind.
Posted on 1/8/24 at 7:48 pm to stout
I’m not trying to derail the thread with a Heloc discussion. I do agree with the points you are making.
Posted on 1/8/24 at 7:49 pm to stout
So it’s net worth excluding the largest investment most people have at that age…makes sense.
Posted on 1/8/24 at 7:49 pm to stout
Gen X is closer to boomers in terms of undersaving. This doesn't surprise me one bit.
This post was edited on 1/8/24 at 7:50 pm
Posted on 1/8/24 at 7:49 pm to PhiTiger1764
quote:
I’m not trying to derail the thread with a Heloc discussion
I understand and I get your point as well
Posted on 1/8/24 at 7:50 pm to TigrrrDad
quote:
So it’s net worth excluding the largest investment most people have at that age…makes sense.
Yes and if you read the thread instead of assuming you were the first to make this point you would see why it was excluded.
Posted on 1/8/24 at 7:58 pm to stout
quote:Can also sell and downsize while accessing a significant portion of the equity of a paid off asset that has greatly appreciated. However, stripping out home equity can provide useful information.
A reverse mortgage? Sure I guess. I wouldn't care to have to rely on that in my old age.
Posted on 1/8/24 at 7:58 pm to TigrrrDad
quote:
So it’s net worth excluding the largest investment most people have at that age…makes sense
If your tranmission goes out on your car or you have a need for cash quickly, you cannot liquidate your house to cover it.
The data indicates most are bad at saving cash. We live in a hyperconsoomer society and the lack of savings reflects this fact.
Posted on 1/8/24 at 7:59 pm to WDE24
quote:
Can also sell and downsize while accessing a significant portion of the equity of a paid off asset that has greatly appreciated.
Yes I pointed this out earlier
quote:
However, stripping out home equity can provide useful information.
I agree.
Posted on 1/8/24 at 8:00 pm to stout
(no message)
This post was edited on 1/8/24 at 8:03 pm
Posted on 1/8/24 at 8:05 pm to stout
quote:my bad. I commented without reading all replies
I pointed this out earlier
Posted on 1/8/24 at 8:06 pm to WDE24
All good
Posted on 1/8/24 at 8:13 pm to stout
quote:
Because if you sell your house, you have to buy a new one. I figured more would get this. Guess not.
There is always the possibility that you end up in some sort of assisted living facility in your old age. In that case you could use equity to fund that which would be renting.
Posted on 1/8/24 at 8:15 pm to stout
quote:It's a silly construct. A homeowner can tap their home equity via HELOC or other financing structure.
quote:
Because if you sell your house, you have to buy a new one.
I figured more would get this. Guess not.
OR
A homeowner can sell their home and pocket the equity - and rent. You don't "have to buy a new one".
Let me ask - does the calculation that excludes home equity ALSO exclude a mortgage if there is one?
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