My wife and I are doing pretty well in terms our networth growth, but one thing I’ve noticed is that now that we have more money, smaller amounts of cash sometimes seem relatively less important. For example, when we were in our late twenties, our networth was about $125,000 and we were quite interested in going after small amounts of cash like $25 or $50.

Now that my wife and I have more money, I find that there’s less incentive to pursue small bits of cash. I think this is partly because each small amount of money has less of an impact on our net-worth. For example, when we were worth $125,000 adding, say, $1000 to our net-worth would improve our wealth by .8%. But now that that we’re worth $329,000, hustling the same $1,000 only improves our bottom line by .3%. In short, the relative value of money to us is declining.

It’s the classic problem, the bigger you get, the more you have to work to achieve the same level of growth.

Best,

James

MANAGE YOUR MONEY TOGETHER

Here are some simple guidelines for DINKS to build wealth:

1) Collaborate: Meet regularly to talk about money, set goals together, track and monitor them.

2) Understand and respect your partner. Take time to understand your partners values about money.

3) Watch the numbers. Get a budget, monitor your spending and track your net worth.

4) Max your retirement. Maximize contributions to your tax deferred retirement accounts.

5) Invest in stock. Stocks perform better than bonds or cash.

6) Avoid high interest debt. Credit cards and title loans are financial cancer.

7) Diversify. Don't put all your eggs in one basket.

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