What is Sammy Savers net worth?
- TheTimeLord
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What is Sammy Savers net worth?
What would you consider Sammy Savers net worth be with the following situation. Sammy is 58 years old?
Taxable Accounts - $500,000
Tax Deferred Accounts - $500,000
Eligible Full Benefit Social Security Benefit - $15,000/yr
Pension with a COLA - $10,000/yr
His house is worth $250,000 with no mortgage
He has No Debt
Taxable Accounts - $500,000
Tax Deferred Accounts - $500,000
Eligible Full Benefit Social Security Benefit - $15,000/yr
Pension with a COLA - $10,000/yr
His house is worth $250,000 with no mortgage
He has No Debt
Last edited by TheTimeLord on Sat Apr 11, 2015 7:01 am, edited 1 time in total.
IMHO, Investing should be about living the life you want, not avoiding the life you fear. |
Run, You Clever Boy! [9085]
Re: What is Sammy Savers net worth?
yay, another one of those how do you calculate net worth threads...
Anyways, I do simple math because it is good enough for me.
$1m with a yearly income of $10k (assuming he is eligible for his pension now). At 67 he'll have a yearly income of $25k in today's dollars.
Anyways, I do simple math because it is good enough for me.
$1m with a yearly income of $10k (assuming he is eligible for his pension now). At 67 he'll have a yearly income of $25k in today's dollars.
Re: What is Sammy Savers net worth?
+1nordlead wrote:yay, another one of those how do you calculate net worth threads...
Anyways, I do simple math because it is good enough for me.
$1m with a yearly income of $10k (assuming he is eligible for his pension now). At 67 he'll have a yearly income of $25k in today's dollars.
Any income above $25k per year (at full retirement) needs to be generated by the $1mm.
- TheTimeLord
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Re: What is Sammy Savers net worth?
How does this address the question asked? Do you need additional parameters?kenschmidt wrote:+1nordlead wrote:yay, another one of those how do you calculate net worth threads...
Anyways, I do simple math because it is good enough for me.
$1m with a yearly income of $10k (assuming he is eligible for his pension now). At 67 he'll have a yearly income of $25k in today's dollars.
Any income above $25k per year (at full retirement) needs to be generated by the $1mm.
IMHO, Investing should be about living the life you want, not avoiding the life you fear. |
Run, You Clever Boy! [9085]
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Re: What is Sammy Savers net worth?
I would consider his net worth to be one million. I don't count the future other stuff.
Re: What is Sammy Savers net worth?
Zero.
Sammy came home early from golf on Sunday and found wife Sandy in bed with his brother Steve. Sammy was heart broken because he and Sandy had been childhood sweethearts and married after high school. Sammy always looked up to Steve as a kid. You see, Sammy and Steve's dad liked to drink and made his son's watch soccer on tv while drunk and Sammy HATED soccer. Sammy's dad would make him play goal keeper and kick soccer balls at him.
Sandy was a cheerleader, the prettiest one in school. She would cheer so loudly for the Smurfs (their highschool mascot) and all the boys would chase after her. But Sammy is the one she let catch her. He called her his little Smurfette (all you kids ask your parents what Smurfs are). They were a happy couple and spent every minute together. Than the night before high school graduation over a Big Mac, Sammy popped the question. Sandy let out a big YES! and he slipped the dime store ring on her finger. They were married at the court house 3 days later. "I promise one day I''ll give you every nice thing you could want" Sammy told her.
Life went on. Sammy went to work at the local Radio Shack knowing they would be in business forever. He worked his way up the company until finally he owned a string of Radio Shacks. Money was pouring in and thankfully Sammy was a saver. Once his brother Steve tried to talk him into buying stock in Best Buy but Sammy refused saying "Index funds are where the cool kids invest." So he saved and saved so that he and Sandy would have the perfect retirement.
But what Sammy didn't know was that Sandy was lonely. Sammy was working 80 hours a week at The Shack trying to provide but that didn't solve Sandy's loneliness. Sammy sensed something was off and finally asked her "What's the deal?"
Sandy said that since Sammy was working all the time she was getting lonely. "I've binged watched all of Breaking Bad and now I need something to occupy my time." Sammy came up with the perfect solution, " Let's have a kid. That solves everything."
So that's what they did. Little Sissy was born 9 months later happy and healthy. Sammy loved Sissy very much and was a good father. He opened up a 529 and even a ROTH when she went to work at his Radio Shack at age 13. Their relationshp was perfect except for her love of soccer. "It's just a phase" he said to himself, "She'll grow out of it."
But she didn't.
Years passed by and Sissy graduated from highschool and enrolled in state college with a soccer scholarship. After discussing it with her dad Sissy decided getting a degree in Arts was foolish and decided to become an engineer. She zoomed through college, got a great job and moved off to Colorado. Now, the house was empty again. "It's time to enjoy retirement," he told Sandy and he took up golf.
Sammy was returning home after his first golf lesson that Sunday when he pulled into the driveway. He walked up the stairs quietly so he could surprise his wife. As he got closer to the bedroom he could hear the sounds. "It can't be" he thought. He pushed the door open and there they were, Steve and Sandy laying in bed...watching soccer. Tears came to Sammy's eyes as he staggered back downstairs. "I'm sorry Sammy. I know you hate soccer but I...love it."
Sammy couldn't forgive her so he filed for divorce. Since there was no pre-nup Sammy's assets were divided 50/50. Sammy wanted to make up for those losses by trying to make easy money in the stock market so he put all his money into Circuit City stock. He lost everything
So, his networth is now zero.
Sammy came home early from golf on Sunday and found wife Sandy in bed with his brother Steve. Sammy was heart broken because he and Sandy had been childhood sweethearts and married after high school. Sammy always looked up to Steve as a kid. You see, Sammy and Steve's dad liked to drink and made his son's watch soccer on tv while drunk and Sammy HATED soccer. Sammy's dad would make him play goal keeper and kick soccer balls at him.
Sandy was a cheerleader, the prettiest one in school. She would cheer so loudly for the Smurfs (their highschool mascot) and all the boys would chase after her. But Sammy is the one she let catch her. He called her his little Smurfette (all you kids ask your parents what Smurfs are). They were a happy couple and spent every minute together. Than the night before high school graduation over a Big Mac, Sammy popped the question. Sandy let out a big YES! and he slipped the dime store ring on her finger. They were married at the court house 3 days later. "I promise one day I''ll give you every nice thing you could want" Sammy told her.
Life went on. Sammy went to work at the local Radio Shack knowing they would be in business forever. He worked his way up the company until finally he owned a string of Radio Shacks. Money was pouring in and thankfully Sammy was a saver. Once his brother Steve tried to talk him into buying stock in Best Buy but Sammy refused saying "Index funds are where the cool kids invest." So he saved and saved so that he and Sandy would have the perfect retirement.
But what Sammy didn't know was that Sandy was lonely. Sammy was working 80 hours a week at The Shack trying to provide but that didn't solve Sandy's loneliness. Sammy sensed something was off and finally asked her "What's the deal?"
Sandy said that since Sammy was working all the time she was getting lonely. "I've binged watched all of Breaking Bad and now I need something to occupy my time." Sammy came up with the perfect solution, " Let's have a kid. That solves everything."
So that's what they did. Little Sissy was born 9 months later happy and healthy. Sammy loved Sissy very much and was a good father. He opened up a 529 and even a ROTH when she went to work at his Radio Shack at age 13. Their relationshp was perfect except for her love of soccer. "It's just a phase" he said to himself, "She'll grow out of it."
But she didn't.
Years passed by and Sissy graduated from highschool and enrolled in state college with a soccer scholarship. After discussing it with her dad Sissy decided getting a degree in Arts was foolish and decided to become an engineer. She zoomed through college, got a great job and moved off to Colorado. Now, the house was empty again. "It's time to enjoy retirement," he told Sandy and he took up golf.
Sammy was returning home after his first golf lesson that Sunday when he pulled into the driveway. He walked up the stairs quietly so he could surprise his wife. As he got closer to the bedroom he could hear the sounds. "It can't be" he thought. He pushed the door open and there they were, Steve and Sandy laying in bed...watching soccer. Tears came to Sammy's eyes as he staggered back downstairs. "I'm sorry Sammy. I know you hate soccer but I...love it."
Sammy couldn't forgive her so he filed for divorce. Since there was no pre-nup Sammy's assets were divided 50/50. Sammy wanted to make up for those losses by trying to make easy money in the stock market so he put all his money into Circuit City stock. He lost everything
So, his networth is now zero.
Re: What is Sammy Savers net worth?
One million.
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Re: What is Sammy Savers net worth?
I guess if you're asking for the current value of all the above you'd need to do a DCF analysis on the SS and pension. You'd need to make some assumptions of the inflation rate, and the length of payments (i.e. time until death) and discount those cash flows back to today to give you a PV.
You also have to subtract whatever you anticipate to pay in taxes on the tax deffered accounts. Which may be difficult to predict as you don't know what the tax rates will be when you withdraw, or that you won't have a big withdrawal year that bumps you into a higher bracket than anticpated.
I'd say the net worth is... NW = 500K + 500K(1-T)+PV[SS+Pension payments]
where T is your estimated average tax rate of withdrawals on the tax deffered account.
You also have to subtract whatever you anticipate to pay in taxes on the tax deffered accounts. Which may be difficult to predict as you don't know what the tax rates will be when you withdraw, or that you won't have a big withdrawal year that bumps you into a higher bracket than anticpated.
I'd say the net worth is... NW = 500K + 500K(1-T)+PV[SS+Pension payments]
where T is your estimated average tax rate of withdrawals on the tax deffered account.
"The problem with diversification is that it works, whether or not we want it to"
Re: What is Sammy Savers net worth?
I say one million ... but first show me the money.
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Re: What is Sammy Savers net worth?
HaHaHa! I was just trying to get to work and leave Bogleheads when you had to write this stuff.saladdin wrote:Zero.
Sammy couldn't forgive her so he filed for divorce. Since there was no pre-nup Sammy's assets were divided 50/50. Sammy wanted to make up for those losses by trying to make easy money in the stock market so he put all his money into Circuit City stock. He lost everything
So, his networth is now zero.
Clever way to push pre-nups! A pre-nup would not have helped poor Sammy. What Sammy needed was more emotional restraint so that he would not have panicked and foolishly invested his half mill. Also, Sammy could have avoided all of this misery by paying more attention to Sandy during their very long relationship.
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Re: What is Sammy Savers net worth?
If we liquidate Sammy's estate upon his death today, what would we have, that is the question.
The $500K taxable gets a stepped up basis so that's easy.
The $500K tax-deferred becomes an inherited IRA for someone, so we'd need a tax bracket to work with. Let's assume 25%, so that's worth $375K in real dollars.
If the inheritor pulls out the entire $500K in one year, taxes would be higher, so remainder would be less.
So net worth is something less than $875K...
The $500K taxable gets a stepped up basis so that's easy.
The $500K tax-deferred becomes an inherited IRA for someone, so we'd need a tax bracket to work with. Let's assume 25%, so that's worth $375K in real dollars.
If the inheritor pulls out the entire $500K in one year, taxes would be higher, so remainder would be less.
So net worth is something less than $875K...
Attempted new signature...
Re: What is Sammy Savers net worth?
You forgot to add the $255 SS death benefitThe Wizard wrote:If we liquidate Sammy's estate upon his death today, what would we have, that is the question.
The $500K taxable gets a stepped up basis so that's easy.
The $500K tax-deferred becomes an inherited IRA for someone, so we'd need a tax bracket to work with. Let's assume 25%, so that's worth $375K in real dollars.
If the inheritor pulls out the entire $500K in one year, taxes would be higher, so remainder would be less.
So net worth is something less than $875K...
Re: What is Sammy Savers net worth?
Based on how I calculate net worth, the answer is $1 million.
- TheTimeLord
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Re: What is Sammy Savers net worth?
Thanks to everyone you have been very helpful.nordlead wrote:You forgot to add the $255 SS death benefitThe Wizard wrote:If we liquidate Sammy's estate upon his death today, what would we have, that is the question.
The $500K taxable gets a stepped up basis so that's easy.
The $500K tax-deferred becomes an inherited IRA for someone, so we'd need a tax bracket to work with. Let's assume 25%, so that's worth $375K in real dollars.
If the inheritor pulls out the entire $500K in one year, taxes would be higher, so remainder would be less.
So net worth is something less than $875K...
IMHO, Investing should be about living the life you want, not avoiding the life you fear. |
Run, You Clever Boy! [9085]
Re: What is Sammy Savers net worth?
Since we are speculating, let's speculate that the heir of the inherited IRA is in the 10% tax bracket, so the after tax net worth would be something around $950,000. But then that is not my understanding of what net worth means. I was taught that net worth equals current assets - current liabilities. What your current assets may be worth in the future to your heirs after you die and after taxes are paid does not answer the question. If the question is "what might Sammy's estate be worth in the future to his heirs after he dies?" then sure.The Wizard wrote:If we liquidate Sammy's estate upon his death today, what would we have, that is the question.
The $500K taxable gets a stepped up basis so that's easy.
The $500K tax-deferred becomes an inherited IRA for someone, so we'd need a tax bracket to work with. Let's assume 25%, so that's worth $375K in real dollars.
If the inheritor pulls out the entire $500K in one year, taxes would be higher, so remainder would be less.
So net worth is something less than $875K...
Re: What is Sammy Savers net worth?
Less than $1M.
His tax deferred accounts will be subject to some level of tax (with 25K of pension/ss income, though the SS may be excluded if he keeps is income below the threshhold), so he has a deferred tax liability of some amount.
His taxable accounts have an unknown basis, so he may have a deferred tax liability if the FMV is greater than the basis. He may qualify for the 0% rate if he manages to stay in the 15% bracket, $37,450
It is unclear if he lives in a state that levies an income tax or taxes on investment income.
Best case scenario, he lives frugal and keeps below the SS tax threshhold (half benefits = $7,500, plus pension, 10k = $17500, single base is $25k, so his withdrawals/gains are $7,500 or less) and lives in a tax free state. His taxable account has no built in gain, and his meager distributions keeps him in the 10% bracket. So the tax deferred account takes a $50k hit for deferred taxes and his net worth is $950k.
Trouble is, the SS taxation base isn't indexed to inflation yet his pension and benefits are. At some point he will trip the taxation of SS (RMD's may do it) and the true deferred taxes in those years will be closer to 30%. In that case, net worth will be $850k.
Oh, wait, he is 58. He could likely delay SS and do Roth conversions and cap gain harvesting for 12 years to manage his tax rate in lower income years. He will still pay some taxes, so I'll say $950.
His tax deferred accounts will be subject to some level of tax (with 25K of pension/ss income, though the SS may be excluded if he keeps is income below the threshhold), so he has a deferred tax liability of some amount.
His taxable accounts have an unknown basis, so he may have a deferred tax liability if the FMV is greater than the basis. He may qualify for the 0% rate if he manages to stay in the 15% bracket, $37,450
It is unclear if he lives in a state that levies an income tax or taxes on investment income.
Best case scenario, he lives frugal and keeps below the SS tax threshhold (half benefits = $7,500, plus pension, 10k = $17500, single base is $25k, so his withdrawals/gains are $7,500 or less) and lives in a tax free state. His taxable account has no built in gain, and his meager distributions keeps him in the 10% bracket. So the tax deferred account takes a $50k hit for deferred taxes and his net worth is $950k.
Trouble is, the SS taxation base isn't indexed to inflation yet his pension and benefits are. At some point he will trip the taxation of SS (RMD's may do it) and the true deferred taxes in those years will be closer to 30%. In that case, net worth will be $850k.
Oh, wait, he is 58. He could likely delay SS and do Roth conversions and cap gain harvesting for 12 years to manage his tax rate in lower income years. He will still pay some taxes, so I'll say $950.
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Re: What is Sammy Savers net worth?
Net Worth is a "now" thing.
It doesn't include earnings or other income that terminates on death.
It includes the Fair Market Value of things like jewelry, real estate, and motor vehicles.
And it probably should include the tax-adjusted value of things, where applicable.
So in the case of $500k tax deferred, we need to withdraw it all ASAP as ordinary income and determine the after tax value.
Sorry, them's the rules...
It doesn't include earnings or other income that terminates on death.
It includes the Fair Market Value of things like jewelry, real estate, and motor vehicles.
And it probably should include the tax-adjusted value of things, where applicable.
So in the case of $500k tax deferred, we need to withdraw it all ASAP as ordinary income and determine the after tax value.
Sorry, them's the rules...
Attempted new signature...
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Re: What is Sammy Savers net worth?
Unless that 500K is a bequest to a charity.The Wizard wrote:The $500K tax-deferred becomes an inherited IRA for someone, so we'd need a tax bracket to work with. Let's assume 25%, so that's worth $375K in real dollars.
Per FIDO, "A tax-exempt public charity can withdraw pre-tax monies from non-Roth retirement accounts, such as Traditional IRAs and 401(k)s without paying income taxes".
- Ron
Re: What is Sammy Savers net worth?
If Sammy wants to trade options at a brokerage, it's only $500,000.
The requirements for trading options at brokerages are defined as follows (http://www.regulatorycompliance.com/new ... Worth.html)
The requirements for trading options at brokerages are defined as follows (http://www.regulatorycompliance.com/new ... Worth.html)
Liquid Net Worth – In reviewing whether or not a person is suitable to make investments in many long-term or illiquid securities, such as UITs, REITs, and annuities, firms must look at a person’s liquid net worth. So what exactly is liquid net worth? Basically, it is that portion of a person’s net worth that can easily be converted to cash, which includes cash on hand or in the bank and investments, such as stock or mutual funds. It does not include assets such as a person’s house, other real estate, or investments that have no ready market or that would involve significant penalties to liquidate. A home mortgage or loans on investments would be considered liabilities when calculating this amount. Therefore, liquid net worth is generally significantly lower than accounting net worth.
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Re: What is Sammy Savers net worth?
Anything is "worth" what someone will pay for it... So could Sammy could include his Pension in his net worth, if he could get someone to make an offer on it as an annuity? If someone would be willing to give him, say, 150K cash today in exchange for all his future pension and SS checks?The Wizard wrote:Net Worth is a "now" thing.
It doesn't include earnings or other income that terminates on death.
It includes the Fair Market Value of things like jewelry, real estate, and motor vehicles.
And it probably should include the tax-adjusted value of things, where applicable.
So in the case of $500k tax deferred, we need to withdraw it all ASAP as ordinary income and determine the after tax value.
Sorry, them's the rules...
"The problem with diversification is that it works, whether or not we want it to"
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Re: What is Sammy Savers net worth?
It all depends on your definition of net worth and which way you want to look at it. For me, I use the liquidation approach, as in how much cash would Sammy have if he sold everything and paid off his debts today. In that scenario the SS and Pension are worthless since they can't be factored. (at least I don't think so) The taxable is worth full value while the deferred account will have to be discounted by his early withdrawal penalty and current tax rate. At a rough estimate call it somewhere in the neighborhood of $810k or so. (assuming he doesn't have other unlisted assets like a car, house, etc.)
Re: What is Sammy Savers net worth?
Yet another thread to show us how many ways net worth is figured by the masses.
I would also call Sammy's net worth $1m, in this scenario.
Just as I don't count my income/human capital now into net worth, I would leave it out of that one also. I keep it simple... assets and liabilities in hand, so to speak.
I would also call Sammy's net worth $1m, in this scenario.
Just as I don't count my income/human capital now into net worth, I would leave it out of that one also. I keep it simple... assets and liabilities in hand, so to speak.
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Re: What is Sammy Savers net worth?
I think at the minimum you have to take an estimated amount out for taxes. That's essentially the government's asset Sammy is carrying on his balance sheet. Granted, it is an unknown amount (future tax rates, withdrawal percentages, other earned income could all change), but whatever is paid out isn't his money.
"The problem with diversification is that it works, whether or not we want it to"
Re: What is Sammy Savers net worth?
Or you could do the flip calculation – not what he would be willing to sell it for but what one would be willing to buy.TheRightKost87 wrote:Anything is "worth" what someone will pay for it... So could Sammy could include his Pension in his net worth, if he could get someone to make an offer on it as an annuity? If someone would be willing to give him, say, 150K cash today in exchange for all his future pension and SS checks?
One can buy an immediate annuity with a 4% payout at the age of 62. He has 25k in annual income per year. 25k / 4% = 625k. This need to be discounted somewhat since Sammy is 58, but not by much.
Some "rich" people will struggle with retirement because they lack retirement income. Some "poor" people will do quite well because of their pension benefits. Good pension benefits are expensive and have value.
Former brokerage operations & mutual fund accountant. I hate risk, which is why I study and embrace it.
Re: What is Sammy Savers net worth?
I presume that Sammy is a renter. If he had a home, then you could ask whether the value of the house was part of his net worth.
In addition to trading options and buying hedge funds, the other use of net worth numbers would be in divorce proceedings. I do know that future pensions and Social Security are taken into account in divorce proceedings, as is the value of a house. Obviously, the definitions of net worth for these two situations are different.
Which definition did the OP have in mind in posing the question?
In addition to trading options and buying hedge funds, the other use of net worth numbers would be in divorce proceedings. I do know that future pensions and Social Security are taken into account in divorce proceedings, as is the value of a house. Obviously, the definitions of net worth for these two situations are different.
Which definition did the OP have in mind in posing the question?
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Re: What is Sammy Savers net worth?
Masses, nothing! Net worth is what you have in the bank. Period. Future payment stuff (SS and pension) doesn't count. Too futuristic and fluffy. Kind of, you can count on it, but not count it.Twins Fan wrote:Yet another thread to show us how many ways net worth is figured by the masses.
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Re: What is Sammy Savers net worth?
Let's think about this a bit.GoldenFinch wrote:Masses, nothing! Net worth is what you have in the bank. Period. Future payment stuff (SS and pension) doesn't count. Too futuristic and fluffy. Kind of, you can count on it, but not count it.Twins Fan wrote:Yet another thread to show us how many ways net worth is figured by the masses.
Can you "assign" SS and pension payments to someone else for the next 30 or 40 years, in the event you die next week?
If so, then yes, we have an inheritable income stream with a computable value that can be included in net worth.
Go research this and report back...
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Re: What is Sammy Savers net worth?
Reporting back.The Wizard wrote:Let's think about this a bit.GoldenFinch wrote:Masses, nothing! Net worth is what you have in the bank. Period. Future payment stuff (SS and pension) doesn't count. Too futuristic and fluffy. Kind of, you can count on it, but not count it.Twins Fan wrote:Yet another thread to show us how many ways net worth is figured by the masses.
Can you "assign" SS and pension payments to someone else for the next 30 or 40 years, in the event you die next week?
If so, then yes, we have an inheritable income stream with a computable value that can be included in net worth.
Go research this and report back...
My research is simply that I'm 48 and am not counting on either. Will they probably be there? Yes. But,no guarantee. When I log on to SSA.org and look at my future SS payment it says right there that I may not get the number predicted because I will be 65 in 2031. I think I will get some (75%?) or maybe all of it, but I don't count it in my net worth. I also don't count on my pension. I save a lot instead and count what I have today.
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Re: What is Sammy Savers net worth?
I kind of liked my "...you can count on it, but not count it."GoldenFinch wrote:Reporting back.The Wizard wrote:Let's think about this a bit.GoldenFinch wrote:Masses, nothing! Net worth is what you have in the bank. Period. Future payment stuff (SS and pension) doesn't count. Too futuristic and fluffy. Kind of, you can count on it, but not count it.Twins Fan wrote:Yet another thread to show us how many ways net worth is figured by the masses.
Can you "assign" SS and pension payments to someone else for the next 30 or 40 years, in the event you die next week?
If so, then yes, we have an inheritable income stream with a computable value that can be included in net worth.
Go research this and report back...
My research is simply that I'm 48 and am not counting on either. Will they probably be there? Yes. But,no guarantee. When I log on to SSA.org and look at my future SS payment it says right there that I may not get the number predicted because I will be 65 in 2031. I think I will get some (75%?) or maybe all of it, but I don't count it in my net worth. I also don't count on my pension. I save a lot instead and count what I have today.
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Re: What is Sammy Savers net worth?
Damn...That is seriously profound.
-Lumbering
-Lumbering
saladdin wrote:Zero.
Sammy came home early from golf on Sunday and found wife Sandy in bed with his brother Steve. Sammy was heart broken because he and Sandy had been childhood sweethearts and married after high school. Sammy always looked up to Steve as a kid. You see, Sammy and Steve's dad liked to drink and made his son's watch soccer on tv while drunk and Sammy HATED soccer. Sammy's dad would make him play goal keeper and kick soccer balls at him.
Sandy was a cheerleader, the prettiest one in school. She would cheer so loudly for the Smurfs (their highschool mascot) and all the boys would chase after her. But Sammy is the one she let catch her. He called her his little Smurfette (all you kids ask your parents what Smurfs are). They were a happy couple and spent every minute together. Than the night before high school graduation over a Big Mac, Sammy popped the question. Sandy let out a big YES! and he slipped the dime store ring on her finger. They were married at the court house 3 days later. "I promise one day I''ll give you every nice thing you could want" Sammy told her.
Life went on. Sammy went to work at the local Radio Shack knowing they would be in business forever. He worked his way up the company until finally he owned a string of Radio Shacks. Money was pouring in and thankfully Sammy was a saver. Once his brother Steve tried to talk him into buying stock in Best Buy but Sammy refused saying "Index funds are where the cool kids invest." So he saved and saved so that he and Sandy would have the perfect retirement.
But what Sammy didn't know was that Sandy was lonely. Sammy was working 80 hours a week at The Shack trying to provide but that didn't solve Sandy's loneliness. Sammy sensed something was off and finally asked her "What's the deal?"
Sandy said that since Sammy was working all the time she was getting lonely. "I've binged watched all of Breaking Bad and now I need something to occupy my time." Sammy came up with the perfect solution, " Let's have a kid. That solves everything."
So that's what they did. Little Sissy was born 9 months later happy and healthy. Sammy loved Sissy very much and was a good father. He opened up a 529 and even a ROTH when she went to work at his Radio Shack at age 13. Their relationshp was perfect except for her love of soccer. "It's just a phase" he said to himself, "She'll grow out of it."
But she didn't.
Years passed by and Sissy graduated from highschool and enrolled in state college with a soccer scholarship. After discussing it with her dad Sissy decided getting a degree in Arts was foolish and decided to become an engineer. She zoomed through college, got a great job and moved off to Colorado. Now, the house was empty again. "It's time to enjoy retirement," he told Sandy and he took up golf.
Sammy was returning home after his first golf lesson that Sunday when he pulled into the driveway. He walked up the stairs quietly so he could surprise his wife. As he got closer to the bedroom he could hear the sounds. "It can't be" he thought. He pushed the door open and there they were, Steve and Sandy laying in bed...watching soccer. Tears came to Sammy's eyes as he staggered back downstairs. "I'm sorry Sammy. I know you hate soccer but I...love it."
Sammy couldn't forgive her so he filed for divorce. Since there was no pre-nup Sammy's assets were divided 50/50. Sammy wanted to make up for those losses by trying to make easy money in the stock market so he put all his money into Circuit City stock. He lost everything
So, his networth is now zero.
Re: What is Sammy Savers net worth?
Correct for that situation. The operative word is "now". After I stopped laughing, I updated the wiki to take care of the OP's question.saladdin wrote:He lost everything
So, his networth is now zero.
$1,000,000. See the wiki: Net worthTheTimeLord wrote:What would you consider Sammy Savers net worth be with the following situation. Sammy is 58 years old?
Taxable Accounts - $500,000
Tax Deferred Accounts - $500,000
Eligible Full Benefit Social Security Benefit - $15,000/yr
Pension with a COLA - $10,000/yr
No Debt
A net worth statement reports the market value of your assets and the balance owed on your debts at a MOMENT in time (compare to an income statement and/or budget). For example, you might create a net worth statement for yourself as of December 31, 2014. The difference between the total value of your assets and the total balance of your debt is your net worth.[2]
Re: What is Sammy Savers net worth?
I don't think anyone could reasonably argue with a figure of about $1.5M.TheTimeLord wrote:What would you consider Sammy Savers net worth be with the following situation. Sammy is 58 years old?
Taxable Accounts - $500,000
Tax Deferred Accounts - $500,000
Eligible Full Benefit Social Security Benefit - $15,000/yr
Pension with a COLA - $10,000/yr
No Debt
The income streams are worth >$600k.
Taxes will be well below 15%.
You didn't mention house, human capital etc, but you'd have to add those in too, of course.
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Re: What is Sammy Savers net worth?
Any response outside of $1 million is nonstandard.
If sammy died tomorrow he could leave $1 million to charity, not more or less.
If sammy died tomorrow he could leave $1 million to charity, not more or less.
Re: What is Sammy Savers net worth?
I'd ask him what he wants the number for. If he's looking for bragging rights, he could include the NPV of his pension and even SS. If he's trying to sound as poor as possible, he would ignore the income streams and use the after tax value of his savings. If he's trying to assess his retirement income, he shouldn't be focused on net worth and should be focused on how much spendable income he'll generate. If he's trying to compare his net worth honestly with someone else, he should use the same method that they use.
Quicken calculates my net worth based on the above as $1,000,000. Well, unless I have some type of vested lump sum payout option for the pension, then that would be included. I find it kind of silly though because if I move money from an IRA to a Roth IRA and pay taxes on it now, my calculated net worth drops significantly more than my ability to spend in retirement. I ignore the net worth number and give my wife estimates of our ability to spend in retirement based on current and projected savings and make that relative to our current expenses. In the end, that's what we really want to know - at what age can we retire while maintaining a substantially similar lifestyle.
Quicken calculates my net worth based on the above as $1,000,000. Well, unless I have some type of vested lump sum payout option for the pension, then that would be included. I find it kind of silly though because if I move money from an IRA to a Roth IRA and pay taxes on it now, my calculated net worth drops significantly more than my ability to spend in retirement. I ignore the net worth number and give my wife estimates of our ability to spend in retirement based on current and projected savings and make that relative to our current expenses. In the end, that's what we really want to know - at what age can we retire while maintaining a substantially similar lifestyle.
Re: What is Sammy Savers net worth?
To keep this actionable, I assume the OP is asking about his own situation (or potential situation). The discussion should remain focused on these aspects.
TheTimeLord - Was your question answered?
TheTimeLord - Was your question answered?
Re: What is Sammy Savers net worth?
You asked what I think is a simple question. No need to get into trying to calculate a current value of the pension or SS in my opinion. It's an income stream. When you die, it goes away.TheTimeLord wrote:How does this address the question asked? Do you need additional parameters?kenschmidt wrote:+1nordlead wrote:yay, another one of those how do you calculate net worth threads...
Anyways, I do simple math because it is good enough for me.
$1m with a yearly income of $10k (assuming he is eligible for his pension now). At 67 he'll have a yearly income of $25k in today's dollars.
Any income above $25k per year (at full retirement) needs to be generated by the $1mm.
What type of answer were you hoping to get?
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Re: What is Sammy Savers net worth?
No, he could leave $1 million + the proceeds of the sale of his house minus any associated real estate fees. I think the $1 million figure listed above understates his networth in not including the value of his debt-free home.letsgobobby wrote:Any response outside of $1 million is nonstandard.
If sammy died tomorrow he could leave $1 million to charity, not more or less.
Re: What is Sammy Savers net worth?
The question got edited this morning to include $250K home with no mortgage. Why the question got edited to include this is a mystery, but it makes every subsequent answer wrong!
The original question read:
TheTimeLord wrote:
What would you consider Sammy Savers net worth be with the following situation. Sammy is 58 years old?
Taxable Accounts - $500,000
Tax Deferred Accounts - $500,000
Eligible Full Benefit Social Security Benefit - $15,000/yr
Pension with a COLA - $10,000/yr
No Debt
The original question read:
TheTimeLord wrote:
What would you consider Sammy Savers net worth be with the following situation. Sammy is 58 years old?
Taxable Accounts - $500,000
Tax Deferred Accounts - $500,000
Eligible Full Benefit Social Security Benefit - $15,000/yr
Pension with a COLA - $10,000/yr
No Debt
- HardKnocker
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- Location: New Jersey USA
Re: What is Sammy Savers net worth?
$1,250,000
“Gold gets dug out of the ground, then we melt it down, dig another hole, bury it again and pay people to stand around guarding it. It has no utility.”--Warren Buffett
- HardKnocker
- Posts: 2063
- Joined: Mon Oct 06, 2008 11:55 am
- Location: New Jersey USA
Re: What is Sammy Savers net worth?
Ha!saladdin wrote:Zero.
Sammy came home early from golf on Sunday and found wife Sandy in bed with his brother Steve. Sammy was heart broken because he and Sandy had been childhood sweethearts and married after high school. Sammy always looked up to Steve as a kid. You see, Sammy and Steve's dad liked to drink and made his son's watch soccer on tv while drunk and Sammy HATED soccer. Sammy's dad would make him play goal keeper and kick soccer balls at him.
Sandy was a cheerleader, the prettiest one in school. She would cheer so loudly for the Smurfs (their highschool mascot) and all the boys would chase after her. But Sammy is the one she let catch her. He called her his little Smurfette (all you kids ask your parents what Smurfs are). They were a happy couple and spent every minute together. Than the night before high school graduation over a Big Mac, Sammy popped the question. Sandy let out a big YES! and he slipped the dime store ring on her finger. They were married at the court house 3 days later. "I promise one day I''ll give you every nice thing you could want" Sammy told her.
Life went on. Sammy went to work at the local Radio Shack knowing they would be in business forever. He worked his way up the company until finally he owned a string of Radio Shacks. Money was pouring in and thankfully Sammy was a saver. Once his brother Steve tried to talk him into buying stock in Best Buy but Sammy refused saying "Index funds are where the cool kids invest." So he saved and saved so that he and Sandy would have the perfect retirement.
But what Sammy didn't know was that Sandy was lonely. Sammy was working 80 hours a week at The Shack trying to provide but that didn't solve Sandy's loneliness. Sammy sensed something was off and finally asked her "What's the deal?"
Sandy said that since Sammy was working all the time she was getting lonely. "I've binged watched all of Breaking Bad and now I need something to occupy my time." Sammy came up with the perfect solution, " Let's have a kid. That solves everything."
So that's what they did. Little Sissy was born 9 months later happy and healthy. Sammy loved Sissy very much and was a good father. He opened up a 529 and even a ROTH when she went to work at his Radio Shack at age 13. Their relationshp was perfect except for her love of soccer. "It's just a phase" he said to himself, "She'll grow out of it."
But she didn't.
Years passed by and Sissy graduated from highschool and enrolled in state college with a soccer scholarship. After discussing it with her dad Sissy decided getting a degree in Arts was foolish and decided to become an engineer. She zoomed through college, got a great job and moved off to Colorado. Now, the house was empty again. "It's time to enjoy retirement," he told Sandy and he took up golf.
Sammy was returning home after his first golf lesson that Sunday when he pulled into the driveway. He walked up the stairs quietly so he could surprise his wife. As he got closer to the bedroom he could hear the sounds. "It can't be" he thought. He pushed the door open and there they were, Steve and Sandy laying in bed...watching soccer. Tears came to Sammy's eyes as he staggered back downstairs. "I'm sorry Sammy. I know you hate soccer but I...love it."
Sammy couldn't forgive her so he filed for divorce. Since there was no pre-nup Sammy's assets were divided 50/50. Sammy wanted to make up for those losses by trying to make easy money in the stock market so he put all his money into Circuit City stock. He lost everything
So, his networth is now zero.
“Gold gets dug out of the ground, then we melt it down, dig another hole, bury it again and pay people to stand around guarding it. It has no utility.”--Warren Buffett
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Re: What is Sammy Savers net worth?
OP changed his query after my post, thus invalidating all subsequent responses.2stepsbehind wrote:No, he could leave $1 million + the proceeds of the sale of his house minus any associated real estate fees. I think the $1 million figure listed above understates his networth in not including the value of his debt-free home.letsgobobby wrote:Any response outside of $1 million is nonstandard.
If sammy died tomorrow he could leave $1 million to charity, not more or less.
Re: What is Sammy Savers net worth?
Thanks, I missed that. Changing the original question does indeed invalidate the responses and has derailed the thread.letsgobobby wrote:...OP changed his query after my post, thus invalidating all subsequent responses.
Let's call this thread done (no added value to continue). This thread has run its course and is locked. See: Forum Policy
TheTimeLord - If you want to reopen the thread, please PM me to discuss.Locked Topics
Moderators or site admins may lock a topic (set it so no more replies may be added) when a violation of posting policy has occurred. Occasionally, even if there are no overt violations of posting policy, a topic (or thread) will reach a point where the information content of the discussion has been essentially exhausted and further replies are much more likely to cause distress to the community than add anything of value.