By Gabriele Denaro · Published 20 September 2026 · Updated 6 October 2026
Income is a flow: it arrives over a period of time, like water running into a bathtub. Net worth is a stock: it is the water in the tub at a given moment. The tub fills only if more flows in than drains out, and a wide tap says nothing about how full the tub is.
Elena earns €60,000 a year and spends €58,000, so she saves €2,000. Luca earns €30,000 and spends €24,000, so he saves €6,000. After ten years, ignoring investment returns, Elena has added €20,000 to her net worth and Luca €60,000. Luca earns half as much and is three times further ahead.
Income is visible: it shows in job titles, payslips and what people say. Spending and savings are private, and so is net worth. We end up comparing the part we can see, and a high income can easily hide a household that spends nearly all of it.
None of this makes income irrelevant. A higher income gives you more room to save, and a very low one can make saving impossible whatever your habits. The useful question is how much of each month's income reaches your net worth, which is exactly what the savings rate measures.
Track net worth monthly to see the stock, and calculate your savings rate to see how much of the flow you keep. Together they show whether a raise, a new job or a cut in expenses actually changed your position, or only changed your lifestyle.
General educational information, not personal financial, tax or legal advice. It may be incomplete or out of date. Terms of use.