I liked your video. Maybe make 2 spreadsheets one with the house and one without. You could also do a separate spreadsheet with just the house. I just don’t think people for the most part access the equity in their homes. Yes of course people downsize etc but good to keep an eye on your home’s value in your overall net worth. Thanks
Your right. I struggled with how to present this concept. And I’m not always sure if home equity should be counted given our primary residence typically just costs us money. I was mainly trying to give normal people like me hope that they can build some wealth with a few good practices and some time. When you get to my age (late 40’s) you realize how fast a decade can wiz by. Thank you for commenting. Take care!!! Greg
Are you adding in property tax and maintenance fees? It should probably be added to the calculations as they are a cost associated with having that "investment" called real estate. Since we are using a 7% for the home, which is the 40 year average in California, then I recommend using the average property tax rate there of around 1% in most municipalities and then around .5% in maintenance fees. Granted you might still be a net worth millionaire in year 15, but if you are going to include the exact SP returns instead of the average, then its probably better to count these in.
So I am very confused by your video. You constantly say the NW column is being multiplied by the S&P return for that year, but it also appears that your including your housing in the net worth. So your house is generating 7% but is also being multiplied by the S&P but that just doesn't make sense. Could you please explain?
I’m adding a conservative 7% growth each year for housing. It went up more, but I like to keep that conservative when discussing primary residence. I’m using the S&P return each year for just the investment account. These are estimates just to illustrate how a middle class person can build wealth with consistent automated contributions to a diverse stock portfolio. I added the housing because most people hit a million based on home equity and a 401k. It’s just supposed to be inspirational and simplified for illustrating purposes. Thank you for commenting and watching, I really appreciate it!!!!
This is great feedback. In the next video I will probably leave home equity out completely. I was trying to de emphasize home equity because I see a primary home as a consumable and mainly cost. but it seems that confuses things. Thank you!!!
I’m going to re present the numbers solely based on a portfolio of equities and remove the real estate part. I agree that makes this a bit confusing. Thanks again.
That’s a good point. I do realize that this represents a pretty good salary. If two people are working in the household this can be achieved pretty easily. But it shows the potential. Thank you for commenting.
Thank you for watching. This is a real world example of how a person with a steady middle class job can build wealth. This reduces stress and makes a person stronger.
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I liked your video. Maybe make 2 spreadsheets one with the house and one without. You could also do a separate spreadsheet with just the house. I just don’t think people for the most part access the equity in their homes. Yes of course people downsize etc but good to keep an eye on your home’s value in your overall net worth. Thanks
Your right. I struggled with how to present this concept. And I’m not always sure if home equity should be counted given our primary residence typically just costs us money. I was mainly trying to give normal people like me hope that they can build some wealth with a few good practices and some time. When you get to my age (late 40’s) you realize how fast a decade can wiz by. Thank you for commenting. Take care!!! Greg
Are you adding in property tax and maintenance fees? It should probably be added to the calculations as they are a cost associated with having that "investment" called real estate.
Since we are using a 7% for the home, which is the 40 year average in California, then I recommend using the average property tax rate there of around 1% in most municipalities and then around .5% in maintenance fees.
Granted you might still be a net worth millionaire in year 15, but if you are going to include the exact SP returns instead of the average, then its probably better to count these in.
This is really great! Thanks for posting.
So I am very confused by your video. You constantly say the NW column is being multiplied by the S&P return for that year, but it also appears that your including your housing in the net worth. So your house is generating 7% but is also being multiplied by the S&P but that just doesn't make sense. Could you please explain?
I’m adding a conservative 7% growth each year for housing. It went up more, but I like to keep that conservative when discussing primary residence. I’m using the S&P return each year for just the investment account. These are estimates just to illustrate how a middle class person can build wealth with consistent automated contributions to a diverse stock portfolio. I added the housing because most people hit a million based on home equity and a 401k. It’s just supposed to be inspirational and simplified for illustrating purposes. Thank you for commenting and watching, I really appreciate it!!!!
This is great feedback. In the next video I will probably leave home equity out completely. I was trying to de emphasize home equity because I see a primary home as a consumable and mainly cost. but it seems that confuses things. Thank you!!!
I’m going to re present the numbers solely based on a portfolio of equities and remove the real estate part. I agree that makes this a bit confusing. Thanks again.
Only 1 line of that chart is a moderate salary😂
That’s a good point. I do realize that this represents a pretty good salary. If two people are working in the household this can be achieved pretty easily. But it shows the potential. Thank you for commenting.
Thank you for watching. This is a real world example of how a person with a steady middle class job can build wealth. This reduces stress and makes a person stronger.