Financial experts would say that the three most important numbers in our financial life are our income, credit score and net worth. The fact that most people would assess you based on these numbers, and probably most especially, the third one, shows the actual importance of the net worth of someone like an entrepreneur or a business developer.
We may not want to admit or think about it, but to a lot of people, these three numbers might even be more important than we think they are. However, is our net worth even accurate? If so, how important is it to know how accurate the calculation of someone’s net worth actually is? The bad news is, according to Ted Bauman on tedbaumanguru.com, theirs is a pretty big chance that people heading to their retirement are going at it with a faulty figure.
One of the factors affecting the inaccuracy of our net worth is the difference between price and value on sovereignsociety.com. Ted Bauman cited a $300 video game console for example. Was the product worth the price? Surely for $300 one can buy other things that are more valuable. The price/value relationship, like most, is very complicated. Like how fidget spinners were a huge thing a couple of months before, and it sold at high prices while it was a hot entertaining toy, especially for kids and teenagers (even though adults were buying fidget spinners as well to “relieve stress”). However, now that people are bored, fidget spinners have lost their value in the market, and that tells us that anyone who bought them during the end of their lifespan to sell at a higher price might’ve faced money loss according to tumblr.com.
Inequality is one of the biggest things that affect people’s net worth as well as retirement. It has been proven that younger generations are not earning as much as the generations before them. So what will happen when a retiring couple plans to sell their house, but younger generations can’t afford to buy their homes at the estimated value of their net worth? This is why Ted Bauman advises people to plan their retirement around value and not price, because the quality of things changes over time and is sometimes hard to predict.
Ted Bauman is the editor of The Bauman Letter and has been with Banyan Hill Publishing since 2013. He has dedicated his life to helping people get in touch with resources they need to really lead a sovereign life, free from corporate greed and governmental insight.
Visit https://seekingalpha.com/user/48547799/comments for more details about Ted Bauman.