Originally Posted by BoredSocial
As a result household income is probably a much better measurement of how well you're doing than your own salary.
I think the best measurement of how well you're doing is savings and investment growth rate. I've come to realize that income is only a factor and not even the biggest factor. It's all about being able to save a certain % of what you make every month.
I personally know people who make good salaries (+120k) and are broke and in debt, and I know people who make half that who have assets and investments and savings. People tend to stretch their money to a point where they see something they want and then try to figure out how they can make it affordable with their salaries instead of going for the best deal. A perfect example would be opting for a 20 year mortgage instead of the 30. If you can't "afford" to pay the 20 year, you probably can't "afford" the house, but people don't think this way because they can swing the 30 year payment.
The key is keeping the housing and car payments in a reasonable range, allowing for savings and assets to increase over time. After a few years of that, you actually can have money that you can do something significant with. Nothing opened my eyes up to this more than when our retirement accounts and savings got to over 60k or so, then I started really becoming interested in growing it.