Money and junk 💰

“Don’t expect all that much when you trade in Big Red next year for a new truck.” Somehow those words struck me as odd, as I never thought of an automobile as having any resale value whatsoever. I mean I knew at one level autos have a value, you pay money to buy them but then you use them up and they become trash just like the countless other things you buy. Automobiles are widely known as a depreciating asset, though I’ve always thought of them as something for personal transportation and enjoyment – not something for resale value.

“Owning a house means you are building equity.” Likewise, I often think those words are odd because while it’s true housing prices often rise, you are betting a lot of money on a single asset in a single location. Insurance can protect you from certain risks like fire but many financial risks of homeownership like a failed roof or furnace – or that a neighborhood slides downhill – are not protected. Houses aren’t like buying stock or bonds, you most constantly be maintaining them and spending money on them if you want them to retain their value. But alas we all have to live somewhere. Housing is not free if you rent or buy. Housing can build equity but it’s a fairly trivial side benefit, it’s mostly a consumer expense like a car, maybe you’ll come out ahead when you sell your old house or maybe not. There are no guarantees in life.

Some people are really into putting a value on things they own, quickly selling unneeded and unwanted possessions at tag sales and on Ebay. I’ve never done that as I find it hard to know where to start – what to value – and I don’t really know how to sell things. I generally think of stuff as things you buy, you use up all value and throw away. I guess I have a hard time in my mind putting a value on physical things that I own as they are paid for and the money is gone. Physical things just don’t seem like money to me even if they aren’t all garbage with a resale or scap value.

Another type of asset people often refer to is education and work experience. Yet, at one level I know they are valuable but they also don’t seem real because they’re not a number you can point to and aren’t that valuable unless you are seeking a new job. Friends and social connections are other assets I should do more to develop. It’s something I have not spent enough time on admittedly. Probably far more valuable than investable assets.

They call monetary assets like stocks and bonds or even cash investable assets. Those are the only assets that I see as having any real value. Truth is though I’ve never sold a stock or bond so while they have a paper value, it’s really hard to value them either. Markets go up and down each day and there are capital gains taxes to consider. A good accountant could probably spit out a number – or maybe my brokerage website – but I’m quite happy to just keep adding to them and let them grow.

Maybe I just find money to be rather confusing like so many things in this world today.