There is something I must confess. My husband and I are DINKs.
Now I know that referring to myself as a Dink may seem weird, but I don’t mean it in the most traditional sense of the term. In today’s world there is a growing sect of couples that are referred to as DINKs. This term is not referring to a couple’s personality, but their station in life. DINK households are households that have Dual Incomes coming in and No Kids.
To some, this could seem like a dream situation. You have more free time, more money, and definitely more ways to spend it. However, DINK households share many of the same challenges that traditional families do. The main situation a DINK couple has in common with a traditional family is that they will retire one day. Also, just like any other family, frivolous spending in your early years can really hurt your ability to enjoy your later years.
Here are some tips for DINK households to help ensure they are protected:
Make saving for retirement and elderly care a main priority:
Because DINK households have no children and normally have more discretionary money, they can run into the trap of feeling like they have less to be responsible for.
- This can make it more difficult to save for retirement because it may not seem as pressing of an issue as it is for families with children.
- Another concern with having less people to be responsible for now, is that there may be less people around later, to help with elderly care. DINK couples need to seriously think about elderly care and where they would like to be if they have to live alone in their later years.
Save before you spend on large houses:
Because DINK households typically have less to answer for financially, it’s easier to spend money on large purchases like a new home, furniture, and cars. There is nothing wrong with buying any of these items, you just need to think and be smart about the purchase.
- For smaller items like furniture, do not finance, save until you have the funds before you buy. I know it sucks to wait, but just think how much better it will feel to rest stress and finance free, on that comfy new sectional you purchased for your TV room.
- For larger items, like cars and homes, try to save at least 20% for a down payment and do not buy a home or vehicle that is way over your budget. The less you borrow the less you have to pay back. I know this sounds simple, but it is easy to get into trouble when buying a large item like a home because many people buy with their hearts and not with their heads.
Make sure you address the need for Disability Insurance
There may only be two of you, but that does not mean your financial stability will not be severely affected if one of you becomes injured or sick and cannot work.
- Look at your budget and then look into the disability insurance you have available to you through your place of employment. If it is not enough to cover what you need to survive fiscally, then it is time to start looking into purchasing additional insurance.
Try to limit the amount you pay in taxes:
A DINK household will most likely have less deductions than a traditional family household which means they will owe more in Federal and State taxes at the end of the year. Here are some ways to help lessen the amount you will send to Uncle Sam:
- Look into giving your money and time to charities. Not only will giving to charities help better the world around you, many donations are also tax deductible.
- Claim 0 on your W4’s and if possible, take additional money out of each check for state and federal taxes.
- If you are paying on student loans, you can deduct your interest, but don’t always count on this. If you make over a certain level of income you will not be able to deduct as much as you might think.
- Please refer to brightpeak’s Tax Book for more helpful tax hints.
Being a “Dual Income No Kids” household can be a lot of fun, but that doesn't mean you should forget about planning for your future. Like all other aspects of life, you need to take a step back, think about what you want to achieve, set goals, and then put your plan in motion. This is what my husband and I have done and it has helped me feel more secure and even excited to grow old, happy, and financially healthy in our DINK household.
Written by Christa Bobick
This blog post is from the Author's perspective and doesn't speak for brightpeak financial. Contact brightpeak if you want to know more about brightpeak products, and keep in mind that they are not available in all states and there are some limitations (some exclusions and restrictions may apply).
