How men and women think we are made to live together amazes me.

saladdin

i have a question that is somehow related to this post: in what category of types of income are included money gained from ads and banners on a blog? I can’t understand how are these declared for tax purposes.

I agree that income is related to a sense of self-worth. I think because your income is money which is tangible and very easy to value and relate to. The fact that I’m a good hearted person (or not!) is not something that can easily be quantified the way a paycheck can be. It’s easy to get caught up with a sense of worth tied to finances. However, is a starving artist who produces incredible works of art any more valuable than someone who does accounting? Their contribution to society is so hard to place a value on, so people just look at the bottom line.

If I had a completely anonymous blog, I’d probably put all my #s on it, including income, but since it’s not, I don’t. I’ve thought about starting a totally separate blog just to deal with that, and maybe I will.

Perhaps this would be a fun carnival topic/theme.

My point in all this is that I can state my income for last year or any year prior to that if I go look it up. But it isn’t as simple as it was when I was just a kid starting out. My income isn’t equal to my salary. It is almost always more, occasionally a lot more. I’m looking forward to the year that my investments return more than my annual salary. Since I reinvest all of that these days, that will be a huge boon to my net worth.

However, even in my worst year recently my net worth grew. In 2001, I was laid off by one employer. Because I found another job quickly, I invested my entire severance package. It has slowly disappeared into retirement accounts because it has allowed me to keep my contributions to those maxed out every year since then.

So, I’ve posted this anonymously. I’ve divulged several things, none of which is an exact number for either my income or my net worth. I have a much clearer idea of what my net worth is right now than what my income will be for this year. The key point that changed my life was when I realized that I was playing the financial game for growth in net worth. As far as I’m concerned, my income has to cover the expenses of my lifestyle and funding growth in my savings and investments. I look at any extra income first in terms of whether I can use it to either pay down debt or increase my investments.

Also, I don’t think that income is the most important factor to consider in many of our financial discussions. I know some people that make less than me and are great and saving and investing and I know some that make way more and save less than me. Your financial saviness is all about how you make due with what you have. Sure it should be easier to save more if oyu make more, but in general, the more you make, the more you tend to spend.

So there.

I can understand not discussing income with acquaintances…acquaintances cast lots of judgments based on what you tell them, and there’s just about no way that revealing your income to one would come out well. But on the blogosphere, we’re all simultaneously both friends (less judgmental) and total strangers (unable to have significant direct impact on one another’s lives), so I’d think the incentives against discussing income wouldn’t apply.

I guess it’s habit, for some folks, though.

For example, Person A and Person B may both be saving $1000 a month, but A could be making $30,000 a year while B could be making $130,000 a year. It takes a completely different lifestyle and strategy for A and B to accomplish the same thing. It would be crazy to say income is not relevant.

I think many people who read personal finance blogs hope to find an example they could follow. But seeing someone’s net worth increase by $2000 a month (again, an example) means very little without knowing how much he earned that month. A balance sheet will never reveal more than half the story, unfortunately.

I don’t fault you (or any blogger) for not sharing your income. I absolutely understand the reason and I would not do it myself. In fact, I enjoy your blog a lot and find it to be an amazing resource. I just want to say that income is the elephant in the room when it comes to personal finance, and it’s too bad our society doesn’t discuss it more openly.