Mad Hon · Net worth

Take a net-worth snapshot every quarter

Take a net-worth snapshot every quarter. A step-by-step Mad Hon guide for your Net worth score, written for olim.

1. Understand what the number is and what it is not.
Assets minus liabilities, measured at a moment. It is not income, it is not a score, and it is not a target: a household with a new mortgage can have a large negative net worth and be doing everything right. What makes it useful is the series. A quarter on its own is noise; a year of quarters is a direction, and a direction is something you can act on.
2. Fix one currency and one exchange-rate source before anything else.
Your balance sheet has two countries on it, and probably will for years: a retirement account you were right not to move, a property you kept or sold, an account still open where you came from, a student loan or a mortgage still running there. Pick the currency you will measure in, pick where you will take the rate from, write both down, and use the same pair every quarter. Skip this and your first "growth" will turn out to be the shekel, and you will not be able to tell which quarters were real.
3. List what you own, and know where each Israeli number comes from.
Bank balances and deposits come from the bank app. Pension, provident, keren hishtalmut and managers-insurance balances come from Har HaKesef, the money mountain: a free Ministry of Finance service that lists the savings products registered in your name, including accounts an employer opened without discussing it. It is a different service from Har HaBituach, which is the Capital Market Authority register of insurance policies, so use the savings one here. Property goes in at a realistic sale price rather than at what the flat upstairs is asking. A car goes in at what a dealer would actually pay. Your foreign retirement accounts go in too, converted at the rate you fixed above.
4. List what you owe, starting with the mortgage balance rather than the payment.
Ask your mortgage bank for a doch yitrot lesiluk, a balance-for-settlement report. It lists every track separately with its outstanding principal, which is the figure you want, and it is the only place you will see it broken down. One Israeli feature to expect: if any track is index-linked, its principal is restated with the consumer price index, published by the Central Bureau of Statistics on the 15th of each month for the month before, so the balance can be higher than the sum of the payments you have not yet made. Then add the overdraft you have actually used, not the facility, the card balance you are carrying, consumer loans, any tashlumim already committed, and money owed to family even where nothing was signed.
5. Accept an eighty-percent first pass.
The first snapshot is the one people abandon, because a property valuation and a foreign pension statement both feel like they need a professional. They do not, not for this. An estimate you can improve next quarter is worth more than an exact figure you never produce, and the comparison only needs you to be wrong in the same direction each time.
6. Put four dates in the calendar and record more than the total.
Pick fixed dates a quarter apart and set reminders now. Each time, record the date, the exchange rate you used, every line separately, and only then the total. Recording the lines is what lets a future you see whether the number moved because you saved, because a market moved, because the shekel moved or because a mortgage was paid down. A total on its own cannot tell you which, and those call for completely different responses.

Take a net-worth snapshot every quarter. A step-by-step Mad Hon guide for your Net worth score, written for olim.

1. Understand what the number is and what it is not.

Assets minus liabilities, measured at a moment. It is not income, it is not a score, and it is not a target: a household with a new mortgage can have a large negative net worth and be doing everything right. What makes it useful is the series. A quarter on its own is noise; a year of quarters is a direction, and a direction is something you can act on.

2. Fix one currency and one exchange-rate source before anything else.

Your balance sheet has two countries on it, and probably will for years: a retirement account you were right not to move, a property you kept or sold, an account still open where you came from, a student loan or a mortgage still running there. Pick the currency you will measure in, pick where you will take the rate from, write both down, and use the same pair every quarter. Skip this and your first "growth" will turn out to be the shekel, and you will not be able to tell which quarters were real.

3. List what you own, and know where each Israeli number comes from.

Bank balances and deposits come from the bank app. Pension, provident, keren hishtalmut and managers-insurance balances come from Har HaKesef, the money mountain: a free Ministry of Finance service that lists the savings products registered in your name, including accounts an employer opened without discussing it. It is a different service from Har HaBituach, which is the Capital Market Authority register of insurance policies, so use the savings one here. Property goes in at a realistic sale price rather than at what the flat upstairs is asking. A car goes in at what a dealer would actually pay. Your foreign retirement accounts go in too, converted at the rate you fixed above.

4. List what you owe, starting with the mortgage balance rather than the payment.

Ask your mortgage bank for a doch yitrot lesiluk, a balance-for-settlement report. It lists every track separately with its outstanding principal, which is the figure you want, and it is the only place you will see it broken down. One Israeli feature to expect: if any track is index-linked, its principal is restated with the consumer price index, published by the Central Bureau of Statistics on the 15th of each month for the month before, so the balance can be higher than the sum of the payments you have not yet made. Then add the overdraft you have actually used, not the facility, the card balance you are carrying, consumer loans, any tashlumim already committed, and money owed to family even where nothing was signed.

5. Accept an eighty-percent first pass.

The first snapshot is the one people abandon, because a property valuation and a foreign pension statement both feel like they need a professional. They do not, not for this. An estimate you can improve next quarter is worth more than an exact figure you never produce, and the comparison only needs you to be wrong in the same direction each time.

6. Put four dates in the calendar and record more than the total.

Pick fixed dates a quarter apart and set reminders now. Each time, record the date, the exchange rate you used, every line separately, and only then the total. Recording the lines is what lets a future you see whether the number moved because you saved, because a market moved, because the shekel moved or because a mortgage was paid down. A total on its own cannot tell you which, and those call for completely different responses.