Does that homeless guy have a higher net worth than you?

Does that homeless guy have a higher net worth than you?(ACC).By Nick Sorrentino.It’s very possible. That homeless guy probably isn’t carrying any debt. Most Americans however carry quite a lot, and almost everyone carries some. Don’t get me wrong, there are times when debt makes sense- primarily when one is very solidly in the positive net worth column. But most Americans who have debt are not in that situation.
As a financial advisor I used to compile people’s net worth all the time. I had to to make sure someone was an appropriate client. I am going to let you in on a secret. Lawyers and doctors are often in debt to their eyeballs. And the farmer who you might think doesn’t have a dime to spare often has plenty of dimes, often many more than the lawyers and doctors.
Why? Because, at least where I worked, Charlottesville Virginia, a country culture of thrift runs deep through the people who have lived there for a long time. Additionally many of these farmers have land which goes back generations which over time they have sold. That helps. Who’s the better retail brokerage client, the guy in the new Mercedes or the guy in the late model but clean F-150 pick-up truck? When I was a financial advisor I’d rather have the guy in the truck every time, he likely has more assets to invest. He doesn’t have a $600 car payment. For most Americans assets take a back seat to things. A new car. A new house. Lord knows I’ve personally gone down that route. But debt, until one is well off is a loser’s game for most people, even with rates as low as they are. Most people should avoid debt, no matter what the Federal Reserve says.Read the full story here.