Same for a house. As a rather extreme example: A house is estimated to be worth $600K. There is a mortgage of $200K on the house. Therefore there is $400K equity in the house. Now, you can do what I do, which is to ignore the house completely. But you can't count just the equity but not the debt, or vice versa the debt but not the equity, as it severely distorts the picture. I think it distorts the picture when you completely ignore the house.PSU
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