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Just remember, savings rate can accelerate substantially every year. While it took you 10 years to save the first 500k, it might take less than half of that to save the next 500k. Obviously, this assumes steady increases in compensation as well, and a favourable market. You're doing a great job. Consider switching jobs to make income leaps.
Impressive savings with those numbers, OP. Good work.
I was about 40. Now I am early 50s with $3.6 of which 1.5 was inheritance.
31 or so. 34 now with 1.7. First 1MM is really hard but gains begin to outpace capital contributions and almost HHI
I hit it last year by gambling on stocks. 33 years old
Wasn’t even close to it before gambling
Any lessons learned? Which stocks and how did u find then?
30. Without any help from mommy and daddy.
the first 100k was the most difficult. i accomplished that right around when i first broke 6 figures, maybe a little earlier. the next 400 snowballed after changing into consulting. i generally try to follow the principals of maxing a 401k, roth ira, and taxable accounts but the reality is that i have mostly recently neglected the 401k and have gone full concentration in managing my taxable account and roth ira which has been fruitful. there has never been a year in the last ten years of my self management where my 401knoutperformed
my roth ira or taxable accounts, both self managed and am now toying with abandoning the company 401k altogether and going after higher growth investments with that capital instead. i generally believe i am well educated in financial management and am not proposing i chase irresponsible investmwnts, but that has been something i have been toying with, plus the fact that building the majority of my wealth in a taxable account provides me
liquidity which is honestly very highly valuable to me. net, i am trying to get perspective on how to super charge my way to the ~5M i’m seeking by my 40s while staying mostly liquid as possible
There’s 3 pillars - Earnings, Savings and Investments.
You seem to be doing reasonably well on S & I, to supercharge your way to $5M, you need to figure out a way to increase your earnings. Either within your current job and firm or by changing jobs/firms.
I was 40 when I hit the first $1m. Now at 45, I am just shy of $2m. I would also highly recommend maximizing that 401k, even if your employer doesn’t match, it’s $19k that the government isn’t taxing.
Did you change your strategy after hitting the first $1M? Thanks!
btw thank you all for the genuine responses. i know how these talks go sideways on FB sometimes but legitimately looking to get the perspective of those in similar positions willing to provide it
It's not linear due to market returns. I was stuck in the mud after the 2008 recession for *years*, but continued to save diligently into a sideways/declining market. Then, if you can grow your savings rate significantly faster than expenses, it can really take off. $1m took almost 15 years. The second took 2. The third is on track to come even quicker. ymmv.
I'm a few months away from 30 and still $50k short 😭. I think it's gonna be close depending on how the market does 🤣
Keep going at 30 I had like 30k about to break 136k by month end and just turn 31. Things can change around
Wow!! So impressive you got to save 500k with those salaries. I am 31, I earn more than that (currently sitting at ~200k comp) and I am sitting at like 350k savings. Nice work on your investments, keep it up and don’t obsess with the 1m mark you are doing great!
i’m always reluctant to say this piece because i know how people on here get crucified for having caring parents that helped — the reality is that i graduated debt free. that said, after school all that meant is i started at 0 instead of a negative balance. i began investing my internship money throughout college and that is mostly what is showing dividends now. hoping to push this further and faster now though and the general consensus im seeing is that i just need to beef my income. best of luck to you as well
I hit zero at 31 and 1m at 36. So you’re doing better than me. When comparing yourself to others remember that we just went through an unprecedented market run up and at the end of it we’re seeing an unprecedented housing boom. So anyone with no debt, a good job, and minimal family obligations in the 2009-2015 period got a massive windfall. There will always be someone working harder or getting luckier, and they will probably respond to these threads. Compare yourself to median if you want a benchmark.
It’s definitely a snowball effect. The first milestone is the hardest and slowest. I went from -$280k NW at age 25 to hitting $1M by 36, to $2M by 39. You’re doing great. You’re on your way to much higher if you keep up what you’re doing.
Coach
Well how much are you saying now ? Can you realistically hit your goal ? Don’t think hearing what age others did it really impacts your ability to hit your goal. Too many variables.
It sounds like your income is too low for this goal at 30.
32, though I think it is more useful to use “net worth ratio”…net worth divided by lifetime Medicare earnings from social security statement(+/- net gifts/inheritance/transfers)…this helps to combine offense(rate of return) and defense (% of income saved) into one figure that is easy to compare amongst peers.
I had a Roth IRA at 15, the year those accounts were part of the tax code and I had my first summer job. So definitely had a leg up in terms of my family also having some interest in personal finance. I also had a grandfather who would put $50 in a mutual fund at Christmas instead of a regular gift. That account was worth around $10k when I was in college and helped pay some tuition bills. So, though that account probably started around the time I was born…I didn’t become seriously interested in it until age 12 or so.
As for how aggressive…I always strived to have a minimum of reserves…I would go donate plasma or some such thing if I was short on cash…and I was always short on cash…only after I had a net worth beyond $1 million did I ever have more than $30k in cash…and usually I had around $1k in reserves…I haven’t ever had less than 80% of my net worth in stocks. Does that answer the question?
Your current savings exceeds your pretax earnings, right?