Howdy clint2-ga,
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Essentially. a person's net worth is a "snapshot" of what their assets less
their liabilities are at any one moment. As that person's Social Security
payments are (usually) received as monthly checks, those payments should not
be included in the net worth of that person, outside of any amount they have
already received and placed in savings, etc.
Some definitions of the terms from the InvestorWords.com website.
Net worth
http://www.investorwords.com/3267/net_worth.html
"Total assets minus total liabilities of an individual ..."
Assets
http://www.investorwords.com/cgi-bin/getword.cgi?273
"Any item of economic value owned by an individual ... especially that
which could be converted to cash. Examples are cash, securities ... a
house, a car, and other property."
Liabilities
http://www.investorwords.com/cgi-bin/getword.cgi?2792
"A financial obligation, debt, claim, or potential loss."
The Northern Funds online article "What's Your Net Worth?," provides
the bottom line.
http://www.northernfunds.com/resources/archive/financial/net_worth.html
"What not to include: Social Security and pensions that will be paid as
annuities or income streams."
The "Ask SmartMoney" article "What Are You Worth?" goes into more detail
of exactly your question.
http://www.smartmoney.com/ask/index.cfm?story=20000629
"QUESTION: How do you figure a pension plan and Social Security into a net
worth calculation?
...
Simply stated, net worth is the balance of your assets (everything you own)
minus your liabilities (everything you owe) ...
...
The important thing to remember is that net worth is a statement of your
financial position on a given date ...
...
And don't include Social Security payments or any pensions that only give
you monthly checks until they're in the bank ..."
The AARP's web site has some good information on financial planning.
http://www.aarp.org/financial-creatingplan/Articles/a2002-08-20-NetWorth.html
"Calculate Your Net Worth
...
- Write down the total value of the assets you've listed.
- Subtract your total liabilities from that total.
- Your net worth is what you have left."
The AARP site also has inventory of assets and liabilities worksheets
in .doc format, which means you will need a Word compatible program to
view them.
Assets worksheet
http://assets.aarp.org/www.aarp.org_/articles/financial/docs/assetsinventory.doc
Liabilities worksheet
http://assets.aarp.org/www.aarp.org_/articles/financial/docs/liainventory.doc
Note that the assets worksheet does not even a have a place marked on
it for Social Security payments.
If you need any clarification, feel free to ask.
Search Strategy:
Google search on: "net worth" include "Social Security"
://www.google.com/search?q=%22net+worth%22+include+%22Social+Security%22
Looking Forward, denco-ga - Google Answers Researcher |
