DINKS should budget your finances so that you only live on one salary.
If you can live on the spouse who earns less, more power to you. This means one spouse’s salary pays all your expenses and the other spouse’s salary becomes completely discretionary. And of course around here, we recommend you invest all of the discretionary income into income generating assets like stocks, real estate, or your own business idea.
This rule acts as curb to lifestyle inflation and more importantly, gives you options down the road.
Living on only one salary is also a hedge against future job loss.
If one spouse loses their job for whatever reason, you will still be able to make ends meet. Now this may not work exactly if you make vastly different salaries but you will still be much better off than if you were used to living on 2 incomes. In our case, Ramona is not losing her job but she will be quitting her job this Fall to become a stay at home Mom with the birth of our first baby.
Since we have structured our finances to live on my salary alone, we have the opportunity for Ramona to stay at home.
Now I understand that this strategy can be difficult to follow.
We had to make some hard choices to make this happen. While living in Southern California, we could just barely cover all of our expenses on just my salary with little to no room to spare.
Yet, we wanted to eventually buy a house and let Ramona become a stay at home mom. So we moved to Georgia where the cost of living is lower to give us this option.
For some, it may mean cutting back on discretionary expenses or even just downsizing homes, number of cars, etc to make this work.
So you see, this may require some difficult choices but I think the benefits are well worth the sacrifice.