For three long years Girl Ninja and I have been diligently socking away $2,000 to $5,000 a month in our savings account. As of Friday, we officially hit our goal to have $100,000 in savings. How hot is that?
Bow chicka bow wow.
If you’ve tracked our net worth at all over the last few months, you’d know this cash accounts for about half our net worth. You also saw last week that Girl Ninja and I went under contract to buy our first home, a 1930’s cottage. We are just a few weeks away from writing the biggest check of our lives, to the tune of $80,000, and I can’t help but wonder….
Is our Net Worth about to be cut in half?
I’ve never owned real estate, and therefore have had no reason to include it in our net worth. Part of me thinks I should begin including it because…
- …real estate is an asset and has value
- …real estate typically appreciates over time
- …I include our retirement fund, which I consider illiquid since I can’t touch it
- …it would be depressing to go down $80,000 in NW overnight
- …I could sell the house and get a lot (if not all) of this money back
but then another part of me thinks I shouldn’t include the house in our NW updates because….
- …real estate is illiquid
- …when we sell we will probably just roll our equity in to next down payment
- …determining our home’s value on a monthly basis is virtually impossible
- …I don’t include our cars in our NW, so why would I include our house
I don’t know what I’m going to do, but I only have a few days to figure it out before my July Net Worth update. I’m thinking I’ll probably leave it off, unless I hear some compelling reasons to add it on. A smaller net worth will likely motiviate me to save harder 😉
What about you? Do you (or would you) include your primary residence in your net worth?