Updating Asset Values
I’ve seen this topic come up on some other blogs from time to time. Some people track the value of their home and cars in their net worth while others don’t. For me, knowing there is some real value in both of those assets. I sold one of our 2 cars last year to get some money for roof repairs after I started taking the bus to work. We’ve been a 1 car family ever since.
With that said, it’s keeping an accurate value that is also important so you don’t fool yourself. Since we just bought a new car and our house is getting appraised for re-finance soon, we’ll start off the year with relatively accurate values of both these assets. Also, I used to support the tax and accounting department at my last job when it came to depreciation and asset value. While that method is good for businesses who use that information for tax writeoff’s, it’s only good for that and not a good measure of current market value should you sell. Here is how I plan to keep these values up to date in the future.
Car: I’ll update the value of the car on a quarterly basis by making a visit to the Kelly Blue Book online. Here I can input our mileage, zip code and the features of our car and get the current retail, private-party and trade-in value. Of course the retail will be the highest and is the current value we have on the car. What I’d like to do is look at the retail and the trade-in value and make the changes this year to get the value gradually down to the trade-in value by the end of the year. The difference is a bit big to do it all at once, but I’d like to get it there as that is the most likely scenario for our car when we finally get rid of it in 7 years or so. If you are more likely to sell it on your own, consider revising it down to the private party value.
House: This number I will also update on a quarterly basis. Since I will have a value as of the end of December, I will update in April when the new figures come out on the median home prices for my area over at the National Association of Realtors. Be careful here. Many of the news reports on this data talk about year over year change. You’ll have to do your own calculations of the median value last quarter and this quarter, see what the percentage change was and make the same corresponding change to your own home.
Hopefully these two sources will help me keep a somewhat realistic value of these two large assets. I don’t want to just look good on paper by over inflating numbers, but I do want to have a solid picture of where I stand.
What do you use when you are keeping track of the value of your assets?
