Nov
25

DINKS – Double Income, No Kids Makes Home Ownership a No-Brainer

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DINKs: Beautiful woman embracing husbandA DINK household is one “in which there are two incomes and no children… DINKs are often the target of marketing efforts for luxury items such as expensive cars and vacations”  as defined by www.investopedia.com

DINKs have a lot going for them.  With two incomes and none of the expenses required to raise a couple of kids, they are commonly the consumers of the best things in life from the finest restaurants and fabulous travel to luxury labels and premium services.  In fact, there’s a plethora of websites devoted solely to DINKs and a world of experts who are ready and able to help spend all that discretionary income.

The downside?  If there is one, it’s that he extra income also means they are likely to find themselves in the highest tax brackets.     That means that sheltering income is extremely important.  In addition to 401K’s, IRA’s, tax-deferred investments and the like, home ownership is virtually a no-brainer.

One excellent web site, Dual Income No Kids Finance, affirms that buying a home offers significant financial advantages for DINKS. Sharing the title of “co-grand poobahs,” bloggers Miel and James provide lots of info, including the average  net worth of DINK families:

DINKs

Given such high average income levels, Miel and James strongly advise investing in a home:“If you don’t own your home, and are in otherwise in good shape, you should strongly consider buying a home. There are number of benefits to owning your own place. First, and foremost you have a tremendous tax advantages as the mortgage interest and property tax [for Condos or the tax deductable portion of Coop maintenance] payments can be written off your taxes. Owning real estate also provides important protection against inflation and housing can be an important asset when you reach retirement after the mortgage is paid off.”

For those who are buying for the long term (five to ten years), possibly the best pay-off is the appreciation in the home’s value when it comes time to sell.  Traditionally, a home purchase has been one of the best possible investments. Please refer to the Prudential Douglas Elliman/Miller Samuel’s Manhattan 10 Year Residential Sales Trend Analysis (1999-2008 PDF).

Categories : DINKS

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