I remember reading about PAWs, UAWs, and AAWs. I also remember that the formula for what your net worth should be on average (to be an AAW) is your income (without inheritance[s]) multiplied by one tenth of your age.
But I also remember reading that this "net worth" should not include your house.
Did anyone else find this in the book - that your net worth doesn't include your house?
I've looked through the book to try and support this memory, but I don't see anywhere that it says your house is not apart of your net worth.
For example, say Jeff makes $200,000.00 per year, he is 45 years old.
4.5 x $200,000 = $900,000 --> If Jeff were to be an AAW (average accumulator of wealth) he would need to have a net worth of $900,000.
Now, Jeff owns a home worth $600,000, and has $300,000 cash.
In the books "standards" is Jeff an AAW or a UAW, given that if household property is not included in his net worth, he will only have a net worth of $300,00. On the other hand, it would be $900,000.
Thank you for any help. I appreciate all contributions.