Net worth gap
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From: Arlington Heights, IL
Originally Posted by RC - Ryder,May 22 2007, 03:02 PM
Approximately 1 1/2 -2 years ago, AARP magazine in bold 1/2 inch print and bold color stated that 84% or 87% (I can't remember which one) of ALL seniors have a net worth of less than $250.00 DOLLARS at the time of their death. I'm not kidding. I suggest you make yourself as smart as possible on the subject. Spend it, give it away, or lose it!
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From: Marblehead
I'm pretty high on the skepticism list myself; just reporting what I saw. Hope someone else can confirm, being that I'm no longer an AARP member. You got to admit that would be an eye opener if true?
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From: Erock's my boat!
Originally Posted by Legal Bill,May 22 2007, 03:45 PM
I have found that when I substitute my personal experience for contradictory national data, I am almost always wrong, but your experience may differ.
Many people think they have a greater worth due to all the things they own. When you deduct the liabilities, you may find that you have a negative net worth. In simplistic terms, a person with a million dollars worth of toys, no free cash and a million dollars of debt has less net worth than a person with $10 in hand and nothing else. The person with $10 may seem to have a lot less net worth based on appearances.
Further, a true net worth analysis compares your current worth to that of others at the same moment in time. Comparing your worth today with your parent's worth at the same age, while interesting, isn't the point and can be difficult to adjust for inflation, etc. And just because your parents may have been quite poor doesn't mean they were representative of the population.
Many people think they have a greater worth due to all the things they own. When you deduct the liabilities, you may find that you have a negative net worth. In simplistic terms, a person with a million dollars worth of toys, no free cash and a million dollars of debt has less net worth than a person with $10 in hand and nothing else. The person with $10 may seem to have a lot less net worth based on appearances.
Further, a true net worth analysis compares your current worth to that of others at the same moment in time. Comparing your worth today with your parent's worth at the same age, while interesting, isn't the point and can be difficult to adjust for inflation, etc. And just because your parents may have been quite poor doesn't mean they were representative of the population.
i know what "net worth" is (i'm an accountant). i also realize i simplified the situation (i.e. i didn't explicitly bring up inflation).
but even factoring in inflation, my experience remains.
i would give outright examples, but it may come across as "bragging"....
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From: Cherry Hill, NJ
Originally Posted by Legal Bill,May 21 2007, 02:02 PM
What country do they live in? I'm not sure, but over 10 years, that looks something like 40% compound escalation.
Here's a Google pic:
http://maps.google.com/?ie=UTF8&ll=53.4310...8&t=k&z=15&om=1
When they bought the house in 1973, it cost <US$18,000.
Cons in 1973: There was lousy bus service, no train service, and it was 10 miles from the city center.
Pros in 2007: It has great bus service, train service, and is only 10 miles from the city center.
It also has a nice beach and three championship golf courses
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From: Upstate NY
Originally Posted by RC - Ryder,May 22 2007, 03:02 PM
Approximately 1 1/2 -2 years ago, AARP magazine in bold 1/2 inch print and bold color stated that 84% or 87% (I can't remember which one) of ALL seniors have a net worth of less than $250.00 DOLLARS at the time of their death. I'm not kidding. I suggest you make yourself as smart as possible on the subject. Spend it, give it away, or lose it!
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From: Canton, MA
Originally Posted by PLYRS 3,May 23 2007, 08:25 AM
Bill, i'm not sure i understand your point.
i know what "net worth" is (i'm an accountant). i also realize i simplified the situation (i.e. i didn't explicitly bring up inflation).
but even factoring in inflation, my experience remains.
i would give outright examples, but it may come across as "bragging"....
i know what "net worth" is (i'm an accountant). i also realize i simplified the situation (i.e. i didn't explicitly bring up inflation).
but even factoring in inflation, my experience remains.
i would give outright examples, but it may come across as "bragging"....
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From: Arlington Heights, IL
Originally Posted by Legal Bill,May 23 2007, 08:08 PM
All I'm saying is your logic is a little myopic. My basic point is simple. If you disagree with national statistics because of your personal situation, you are probably wrong. Let me try a different example. If you and every one you know earns $250,000 a year, but national statistics show that the median income is $60,000, do you doubt the accuracy of the national statistics on the basis that "100% of the people I know earn over $250,000?" Even if you know the incomes of 1,000 people, your sample is invalid and your conclusion is wrong.
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From: bolton
Originally Posted by Conedodger,May 23 2007, 11:22 AM
Sounds about perfect to me. A zero dollar net worth at death would be ideal. Of course, this assumes I've survived my spouse.
" and to my children, being of sound mind and body, I pissed away every last cent. your on your own dears"
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From: Marblehead
PLYRS3: You're swimming upstream young fellow. Legal Bill's reference if anything is probably a bit low on the "gap." Average "family" income in the US is in the low to mid 40s, which does not leave a lot of assets for building net worth.