How to count a 401(k) loan, a HELOC, or a car lease in net worth
by Lee Schmidt
Published September 20, 2026
Three common arrangements confuse a net worth sheet because each is partly a loan and partly something else. A 401(k) loan is a liability at its balance while the account is still counted in full; a home equity line is a liability at what has been drawn, not at the limit, with the house unchanged; and a car lease is neither an asset nor a liability, but a commitment that belongs in the budget as a bill. Each is easy to count twice or not at all, and the rule that sorts them is the same one that sorts everything else: an asset is what you own at what it would sell for, a liability is what you owe at its payoff balance, and a future obligation that is not a debt is a bill.
Sort any arrangement with four questions
- Do you own something with a resale value? If yes, it is an asset at that value; if no, nothing goes on the asset side.
- Do you owe a balance for it that would have to be paid off? If yes, it is a liability at the payoff balance; a limit that has not been drawn is not a balance.
- Are the future payments for something you own, or for a service? A loan for a car you own is a liability; payments for a car you are renting are a bill.
- Is there a deposit, a receivable, or a risk left over? A refundable deposit is an asset, money reliably owed to you is an asset, and a co-signed loan is a note.
The rule, applied to the awkward cases
The 401(k) loan
When you borrow from a retirement account, the plan sells $9,000 of investments and hands you $9,000 in cash, and the plan's statement now shows $55,000 invested plus a $9,000 loan receivable, still $64,000. Count the account at $64,000, because that is what the plan holds on your behalf, and count the $9,000 you owe as a liability. On the day of the loan, net worth is unchanged: cash up $9,000, liability up $9,000. As you repay, the liability falls and the plan's invested balance rises by the same amount, and net worth moves only by the interest you pay yourself and by what the account earns.
The mistake in both directions: counting the account at $55,000 and the loan as a liability double-counts the loan and understates net worth by $9,000; counting the account at $64,000 and ignoring the loan overstates it by $9,000.
The home equity line
A HELOC is a credit limit, not a loan, until it is drawn. The limit is not a liability, any more than a credit card's limit is. What has been drawn is a liability, at its current balance, and the house is recorded at its estimate exactly as before; the line is secured by the house, but the house's value does not change because a line exists against it. See Does a house count toward net worth, and how to value it for the house's side.
The cash drawn went somewhere, and that is where it is counted: a renovation is spending that changes the house's estimate only if a comparable sale says so, a debt consolidation moves the balance from one liability to another, and cash still in checking is an asset that offsets the liability until it is spent.
The car lease
A leased car is not owned, so it is not an asset, and the remaining lease payments are a commitment to a service rather than a debt for something you have, so they are not a liability, in the same way that the remaining months of a rent lease are not. The lease payment is a bill in the budget, budgeted like rent, and a refundable security deposit is an asset until it is returned.
Two things change this. A lease with a purchase option that you have decided to exercise is, from that decision, a car you will own at the buyout price, and it can be recorded as an asset at resale with the buyout as a liability. And a lease with early-termination penalties is a commitment with a price, worth a note on the sheet so the price is not forgotten.
A worked sheet
Nothing is counted twice and nothing is missed. The $9,000 loan appears once, as a liability, with the account whole. The HELOC appears at $12,000, not $50,000. The car appears nowhere, and its payment is in the budget where rent is.
Common mistakes
- Counting the 401(k) loan twice, by reducing the account and adding the liability.
- Recording the HELOC at its limit. Only the drawn balance is owed.
- Recording a leased car as an asset. It is returned at the end, and it was never yours.
- Recording the lease's remaining payments as a debt. They are a commitment, like rent, and belong in the budget.
- Forgetting the lease deposit. It is an asset until it comes back.
- Recording a co-signed loan as your debt. It is a risk, and a note, unless you are the one paying.
Common questions
Does a 401(k) loan count against my net worth? Yes, as a liability at its balance, with the account counted at its full value including the loan receivable. On the day of the loan net worth does not change, because the cash received equals the liability created. As it is repaid the liability falls and the account's invested balance rises.
Is a HELOC a liability if I haven't used it? No. An undrawn line is a limit, like a credit card's, and only the drawn balance is owed. Record the drawn balance and update it as it changes; leave the house's estimate alone.
Is a car lease a liability? No. The car is not yours, so it is not an asset, and the future payments are a commitment rather than a debt, so they are not a liability. The payment is a bill in the budget, and a refundable deposit is a small asset. See What counts as an asset and a liability for the general rule.
How do I count buy-now-pay-later plans? The remaining installments are a liability, since they are owed for something you have; the item is an asset only if it has resale value, and most do not. Small plans are easy to lose; list them.
What about a loan I co-signed for a family member? Not your liability unless you are making the payments. It is a risk, and a note on the sheet records it, because a default would make it yours.
How Zypper handles this
Zypper records each of these as the accounts they are. A retirement account connects and contributes its balance to net worth, while the loan against it is a manual account on the liability side whose balance you set from the plan statement and lower as you repay; a HELOC that connects as a loan contributes its drawn balance, or is a manual account at that figure, with the house as a separate manual account at its estimate. A lease is not an account at all: its payment is identified as a recurring bill from your transactions and counted in the budget in the month it is due, and a refundable deposit is a manual asset if you want it on the sheet. See Manual accounts, Supported account types, and Recurring transactions and bill tracking for the details, or get started with Zypper to put each one on the right side.