7 Net-worth killers

Saving and spending aren't the only factors affecting your net worth. How you manage (or don't manage) your assets and liabilities can make a big difference, too.

6. Letting your assets linger
Net worth is a measure of your assets minus your liabilities. But all assets are not created equal. Hanging on to assets that don't do much for you may hurt your net worth long-term.

Sometimes, you should "move an asset from one pot to another where it can produce more income. Monetize something that's not monetized," said certified financial planner Mari Adam.

She cites a case of a couple in their 70s who were house rich but cash poor, down to their last few thousand dollars. They chose to sell their house, bank the money and let it produce income while they rented. That saved them money in the long run since they otherwise would have needed to take equity out of the house to make ends meet. "Net worth is one thing, but cash flow is another," Adam said. "That's where people go wrong with real estate."

Likewise, a second home may be worth a lot on paper, but how much money (to say nothing of time and effort) does it take to maintain? "Something may have value, but if you don't have the cash to pay for it, you'll lose it," Adam said.

Housing forecast: 100 biggest markets
These are the 100 largest markets according to the 2000 Census. Growth forecast is for April 2007 April 2008 from Fiserv Lending Solutions.
McAllen, Texas $130,000 25 26.5 -12.3 88-'89 9.8%
Tulsa $135,000 14 17.6 -7.5 86-'87 4.3%
El Paso $130,000 19 48.2 -5.4 87-'88 4.2%
Scranton $118,000 13 41.2 -7.2 94-'95 3.9%
Rochester, N.Y. $122,000 11 22.3 -4.1 94-'95 3.7%
Buffalo/Niagra Falls $106,000 11 28.6 -5.2 81-'82 3.7%
Fort Worth/Arlington $150,000 14 18.4 -6.9 87-'88 3.6%
Baton Rouge $178,000 19 34.2 -8.3 87-'88 3.6%
Dallas $151,000 13 17.8 -7.7 86-'87 3.6%
Birmingham $165,000 17 31.7 -3.2 80-'81 3.6%
For full table click here.

Ignoring your money

Buying too much house

Driving too much car

Paying the IRS, not yourself

Always getting what you want

Letting your assets linger

Letting your debt lie
Save early. Save often. And don't make these gaffes. (more)
You don't have to spend a lot of time to put your financial house in order. (more)