What Percentage of your Net Worth is in Stocks & Bonds?

L

Lon

Well-known Member
Location
Central California
Net Worth is as you know----Assets minus Liabilities---Don't include SS payments or any pensions in calculating your Net Worth. My own Net Worth is 100% in Stocks & Bonds. 25 years ago when I was 65 years old my Net Worth was 50% in Stocks & Bonds.
 

Sorry, but aren't your house, furnishings and car considered assets as they are salable? Hence if you own your home or equity in your home that your net worth is not 100% stocks and bonds.

Here is what I found that details Net Worth.

[h=3]Assets[/h]Your assets can be defined as everything you own that has monetary value. They may be liquid like a checking account or non-liquid like your home. If an asset is liquid, it simply means you don’t have to sell it first to realize its monetary value. A few general examples of assets are:

  • The market value of your home.
  • The market value of your vehicles.
  • The money in your investment accounts (including your retirement accounts and life insurance contracts).
  • The amount you have in your checking and savings accounts, including CDs and money market accounts.
  • Notable items of value you own, such as artwork, furniture, fine jewelry, or collectibles.
Since items like artwork and jewelry can be highly subjective, only include them as assets if you have had them professionally appraised or have a good sense of what someone would pay for them in today’s market.
[h=3]Liabilities[/h]Liabilities, unlike assets, represent a drain on your resources. These are obligations you have to pay. Your total liabilities aren’t determined by monthly payments owed, but rather by the entire debt you owe. Examples of liabilities include:

  • Mortgages
  • Car loans
  • Credit cards
  • Student loans
  • Outstanding medical bills
  • Back taxes
  • Liens and judgments against you

Many people find that they have a negative net worth, thanks mainly to their mortgage debt and car loans. Credit card debt and student loans also have a big impact on your overall net worth. Case in point, the student loans my husband and I have are a big reason why our net worth is negative right now.
 
I don't really think a financial advisor would recommend keeping all your eggs in one basket. Doing so one runs a big risk of losing everything.

I'm diversified . . . can't take the risk that the market will drop like it did in 2000 and again in 2008. Each time it dropped 30-40%; can't afford to lose that much if I'm not working any longer.
 
LogicsHere said:
I don't really think a financial advisor would recommend keeping all your eggs in one basket. Doing so one runs a big risk of losing everything.

I'm diversified . . . can't take the risk that the market will drop like it did in 2000 and again in 2008. Each time it dropped 30-40%; can't afford to lose that much if I'm not working any longer.
Click to expand...

That's what owning shares in several Mutual Funds does.... It give you diversification.
 
Last edited:
LogicsHere said:
Sorry, but aren't your house, furnishings and car considered assets as they are salable? Hence if you own your home or equity in your home that your net worth is not 100% stocks and bonds.

Here is what I found that details Net Worth.

Assets

Your assets can be defined as everything you own that has monetary value. They may be liquid like a checking account or non-liquid like your home. If an asset is liquid, it simply means you don’t have to sell it first to realize its monetary value. A few general examples of assets are:

  • The market value of your home.
  • The market value of your vehicles.
  • The money in your investment accounts (including your retirement accounts and life insurance contracts).
  • The amount you have in your checking and savings accounts, including CDs and money market accounts.
  • Notable items of value you own, such as artwork, furniture, fine jewelry, or collectibles.
Since items like artwork and jewelry can be highly subjective, only include them as assets if you have had them professionally appraised or have a good sense of what someone would pay for them in today’s market.
Liabilities

Liabilities, unlike assets, represent a drain on your resources. These are obligations you have to pay. Your total liabilities aren’t determined by monthly payments owed, but rather by the entire debt you owe. Examples of liabilities include:

  • Mortgages
  • Car loans
  • Credit cards
  • Student loans
  • Outstanding medical bills
  • Back taxes
  • Liens and judgments against you

Many people find that they have a negative net worth, thanks mainly to their mortgage debt and car loans. Credit card debt and student loans also have a big impact on your overall net worth. Case in point, the student loans my husband and I have are a big reason why our net worth is negative right now.
Click to expand...
My net worth is actually 98.5 % in Stocks & Bonds. The other 1.5% is jewelery,auto & personal effects. I sold off homes and real estate in the past couple of years and now rent an apartment.
 
When the stock market drops like it did in 2000 and 2008 by 30-40%; it didn't matter what funds you had . . . they were hit big time. Trust me as I had only put my money into mutual funds back in 1999 only to have lost 35% of money earned the hard way in savings accounts and cd's. By diversification, I meant, home, savings account, IRA or 401K or both, annuities. Having everything tied up in stocks and bonds, aka mutual funds is still a plan for disaster.
 
teddy Roosevelt said, "do all you can with what you have where you are at"......if we just think about it we all have more than enough ....unless we are selfish and greedy
 
We have around 5% of our portfolio in bonds and about 60% of our investments are in various investment funds-some for income streams and others to continue building our portfolio. Around 20% of our investment is in real estate other than our primary residence, another 10% is in more liquid investments such as bank accounts. The other 5% or so is money that I "play" with, occasionally buying and selling individual stocks.
 
40% here! Mutual funds to play it safe. Seems like another Enron can pop up at any moment. Hard to distinguish between the real and fake. Even the banking collapse was scary and cost me a pretty penny!
 

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