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You make a lot, but how much do you keep?

It may be great that you earn a six-figure income, but if you live a six-figure lifestyle – the occurrence of one negative financial event can cause a financial downward spiral. Nothing teaches us this lesson more than the past NBA lockout a few years back.

We witnessed firsthand millionaires struggling to make ends meet as they hope to soon get a paycheck. Many of us are saying, “If I had that kind of money, I would not be in that situation.”  Oh really?

But know, whether big or small if you are living at or above your means, you are no different. Whether you are making $20,000 or $2 million, if you do not adjust your financial habits you may find yourself in the same situation as your favorite NBA players.

Not Poor, Just Broke I like this saying a lot. When my family members or friends ask me for cash or expect for me to make purchases that are simply beyond my budget, I quickly refer to this phrase. This phrase is powerful, in that, I have already set money aside for my monthly savings, paid all my bills, and met my allocated budgeted amounts for necessary expenses. And more importantly, unless someone really, really….I mean really need funds, you should consider your savings totally off-limits. In the end, it has allowed me to accumulate savings month after month.

Income is Great, But Net Worth is Better Bragging about how much money you make is great, but bragging about your net worth is even better. What is net worth you ask? Well, it is the amount you are worth after you subtract your debts from your assets. If you have a negative net worth, it means you have more debts than assets, if you have a positive net worth, you have more assets than debts.

Before making any financial move, determine whether you are contributing to a positive net worth. Paying off credit cards, purchasing a home, or saving for a rainy day can all increase your net worth.

But keep in mind, there may be some financial events that may not necessarily increase your financial net worth today, but may do so later, such as a student loan.

Keep A Little More importantly, don’t forget to save, save and save. Whether you make a little or lot, the key is to consistently stash something away. Keep in mind, you never know where this life may take you, saving first before paying anyone else consistently will help you weather adverse financial events that may come your way.

Remember: Your Choice, Your Future!

Kemberley Washington is a certified public accountant and a business professor at Dillard University. Follow her on Twitter or subscribe to her blog at

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