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Net Worth vs Investable Assets - There's a BIG DIFFERENCE! | 9 to FI 047
Net Worth vs. Investable (Liquid) Assets: What Really Funds Financial IndependenceJosh and Elliot discuss the difference between net worth and investable assets (liquid net worth) and why confusing them can mislead financial independence planning. Net worth is assets minus liabilities and can include a primary residence, cars, and real estate equity, but those assets may not be easily tapped to fund living expenses without selling. Investable assets—such as a 401(k), Roth IRA, and brokerage accounts—are the liquid holdings typically used for withdrawal-rate calculations like the “$1M for $40k at 4%” baseline. They explore how real estate adds complexity because equity doesn’t translate predictably into cash flow due to rents, appreciation, vacancies, repairs, and capital expenditures, and they emphasize the importance of decumulation mechanics, withdrawal strategy, and understanding where retirement income will actually come from.00:00 Net Worth Basics02:03 Defining Investable Assets03:06 Liquid Net Worth Explained05:36 The Million Dollar Myth06:52 Real Estate Equity Limits09:10 Returns and Leverage Tradeoffs11:28 Real Estate Cash Flow Reality15:29 Baseline FI and Projections21:51 Decumulation and Drawdown Plan26:46 Wrap Up and Take Action
Do you have feedback or suggestions? We want to hear from you!
Contact Elliot: [email protected]
Contact Josh: [email protected]
Josh’s other podcast: Stuck In Beta
Josh’s YouTube channel: How To Fix It Workshop
Any of these products help the show. Thanks for your support!
Mint Mobile - We both use Mint Mobile and save a ton on our phone plan: https://my.mintmobile.com/refer/aEWp5rL
Empower is Josh’s choice for Net Worth and Budgeting
Wanna create a podcast? We use Descript
Looking for a new credit card? We’re big fans of Chase
Buy Us a Coffee - One time donation or monthly, it’s up to you
Want to save money on gas? Try Upside!
Books mentioned in this episode:
Come find us and subscribe on YouTube: http://www.youtube.com/@9toFI
View all episodes
By Elliot and JoshNet Worth vs. Investable (Liquid) Assets: What Really Funds Financial IndependenceJosh and Elliot discuss the difference between net worth and investable assets (liquid net worth) and why confusing them can mislead financial independence planning. Net worth is assets minus liabilities and can include a primary residence, cars, and real estate equity, but those assets may not be easily tapped to fund living expenses without selling. Investable assets—such as a 401(k), Roth IRA, and brokerage accounts—are the liquid holdings typically used for withdrawal-rate calculations like the “$1M for $40k at 4%” baseline. They explore how real estate adds complexity because equity doesn’t translate predictably into cash flow due to rents, appreciation, vacancies, repairs, and capital expenditures, and they emphasize the importance of decumulation mechanics, withdrawal strategy, and understanding where retirement income will actually come from.00:00 Net Worth Basics02:03 Defining Investable Assets03:06 Liquid Net Worth Explained05:36 The Million Dollar Myth06:52 Real Estate Equity Limits09:10 Returns and Leverage Tradeoffs11:28 Real Estate Cash Flow Reality15:29 Baseline FI and Projections21:51 Decumulation and Drawdown Plan26:46 Wrap Up and Take Action
Do you have feedback or suggestions? We want to hear from you!
Contact Elliot: [email protected]
Contact Josh: [email protected]
Josh’s other podcast: Stuck In Beta
Josh’s YouTube channel: How To Fix It Workshop
Any of these products help the show. Thanks for your support!
Mint Mobile - We both use Mint Mobile and save a ton on our phone plan: https://my.mintmobile.com/refer/aEWp5rL
Empower is Josh’s choice for Net Worth and Budgeting
Wanna create a podcast? We use Descript
Looking for a new credit card? We’re big fans of Chase
Buy Us a Coffee - One time donation or monthly, it’s up to you
Want to save money on gas? Try Upside!
Books mentioned in this episode:
Come find us and subscribe on YouTube: http://www.youtube.com/@9toFI