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« Best of Money Carnival | Main | Work and Life: Be Better at Both »

May 29, 2012


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very well explained the formula...
perfect line for conclusion = ""view spending as lost opportunities to save, invest, and grow your net worth""

Good article-- now if I can just find a plug big enough for my drain:(

This article provides a good analogy to look at accumulating net worth.

Of course there is nothing wrong with a financial bathtub overflowing which is where the analogy breaks down...


When measuring your financial health it makes a lot of difference just where you are in your life, what your responsibilities are, and what kind of lifestyle you plan to lead. Everything changes as you progress from starting your first job, to getting married, starting a family, buying a home, achieving your goals, and finally retiring. At 77 and 79 we have been through the whole cycle and everything turned out very well.

Your traits are the biggest factor. Have you been raised by parents that managed their money well and are financially secure? Are you willing to live frugally, well within your means, or are you a "Want it all now" type of individual.

One of the actions that will have the biggest effect upon your financial health is your choice of living partner. Two people that are on the same page with their financial aspirations are the best. A spender and a saver is a deadly combination and a formula for eventual failure, as are two spenders.

Jim and Denise - thanks! Oh, and Denise - a lot of that drain anxiety going around these days! But identifying drain management as the problem is the key, many people just don't see it that way, or don't want to. Now that you have, just stick around FMF for a while and you're sure to get lots of great ideas!

Limey, couldn't agree more about the "stage of financial life" being a key consideration. That's one reason why I chose to write Securing Your Financial Future specifically for YOUNG ADULTS just starting out in their financial lives. Especially now, with pension-style retirement plans all but gone and Social Security on shaky footing, it's never been more important for financial newcomers to get off to a strong start!

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