Is a Car an Asset or a Liability
A car is generally considered a depreciating asset, not a liability. It holds monetary value that can be sold, but it loses value over time. Because it has a market value, it is included in your net worth calculation.
How Your Car Affects Net Worth
Your net worth is your total assets minus your total liabilities. The car’s current market value is an asset. The remaining loan balance is a liability. If you owe more than the car is worth, it reduces your overall net worth.
Should You Include Your Car in Net Worth
Yes, financial advisors typically include vehicles in net worth statements. You can check its estimated value on sites like https://www.kbb.com/. Remember that a car is a consumption asset, not a wealth-building investment.
