The article discusses the role of home equity in calculating net worth, emphasizing that while it is typically included, it is less liquid than other financial assets. Readers are encouraged to recognize the distinct nature of home equity compared to more accessible assets like cash or brokerage accounts. In the context of retirement planning, the article highlights that individuals should think strategically about their net worth and be prepared for the limitations of accessing home equity, such as avoiding additional debt or selling their home.
Home equity is typically included in net worth. However, it's essential to recognize it is less liquid than other assets, so treat it differently.
While home equity can raise your net worth, you should not rely on your home as a source of income, as accessing that value can be challenging.
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