After reading a blog post at Afford Anything that discusses several books including the book, “Your Money or Your Life“, I decided to compare my lifetime earnings to my net worth. That is one of the recommended actions in the book to help transform your relationship with money. Although I read the book when it first came out in 1993 and several times since then I never compared my lifetime earnings to my net worth.
Figuring out my lifetime earnings was easily accomplished by going to SocialSecurity.gov and looking at my earnings record. According to their records I’ve made $328,576 in 31 years of working. Since I’ve also had some earnings from paid medical studies that weren’t subject to SS tax I’m going to bump up the total to $350,000.
Determining my net worth took a little bit more work. Personal Capital tracks financial accounts and shows you your net worth. Unfortunately, they don’t have the correct total for my student loan and I also have some accounts that I don’t track there so I had to determine my correct net worth myself.
Assets
Cash – $4387
Traditional IRA – $21,225
Roth IRA – $9,602
Loan – $1800
Car/Stuff – $5000
Liabilities
Student Loan – $125,331
Credit Cards – $10,593
Net Worth = $-93,910
Out of the $350,000 I’ve earned over my lifetime I have managed to accumulate -$93,910. I knew the total would be bad, but it is still a bummer to see the actual figure.
The credit card balance is from the 0% balance transfers I took out earlier this year to pay down my student loan. That might not have been the best strategy. Once I get the balance transfers paid off I’ll reconsider the best way to pay down my student loan.
It will probably be a while until I can improve my net worth since I have some big bills coming due in January. I also have a few thousand dollars worth of inventory at Amazon that would have made my net worth a little better. Since it is hard to determine a correct value for the inventory I left it out of the net worth calculation.
I’m probably going to start calculating my net worth on a monthly basis. If there is any interest I will share the results here.
What an interesting exercise. Thanks for sharing! I am embarrassed I hadn’t even bothered to set-up an online account yet with SS. Done now!
Samantha – You’re not the only one who procrastinated on setting up an account. It was only a couple of months ago that I did mine.
Hi Andy, I think it should be your total earnings after taxes. SSA.gov shows your gross, not your net, correct? You can probably estimate net income by subtracting estimated income taxes from gross for each year fairly quickly. SS and Medicare tax totals should also be subtracted and those are available on the ssa page.
The earnings on SSA.gov are your gross wages before taxes or other deductions. You could subtract the taxes if you want to use your earnings after taxes rather than your total earnings.
You still have student loans after working 31 years? Not a criticism, just curious how those loans lasted so long?
Joe – The student loan is a more recent acquisition. I was 41 years old when I graduated from law school in 2009.