Why a High Income is Not Enough

Are You Earning And Saving Enough To Build Long Term Wealth?

A high income creates a sense of financial security, but is it really the safety net we think it is? Imagine studying for years to get an advanced degree then taking on a stressful career only to be left struggling to get by if you were to lose your job. Or worse, being unable to retire because you depend on your current income to maintain your quality of life. This is the problem many high-income earners face and why it is vitally important to invest.

Living Pay Check To Pay Check On A Six Figure Salary - Why Do High Income Earners Go Broke?

I recently had the chance to sit down with *Sarah an attending physician at a prominent NYC hospital. Despite her high income and decades long career she was unable to retire. At first, I thought this was a one-off case but after talking with a few other physicians I heard how they also were short on savings.

The common thread was, as we earn more, we spend more – lifestyle creep. See, high income is fleeting. We all struggle on different levels despite our income. Higher education may teach us the skills needed to have a high-income career but provides little guidance on how to manage that income effectively.

So how can you tell if you are financially healthy?

So how can you tell if you are financially healthy?

How Do You Track Your Financial Health?

One way to track your financial health is to calculate your net worth. Simplified, your net-worth is a marker of your wealth, your true financial health. It compares what you own to what you owe, your assets minus your liabilities.