Want to learn how to become a millionaire by 30? Here’s my story on how I reached a million dollar net worth in my late-20s. It involved a lot of luck, a lot of effort, and a lot of risk.
I believe all Financial Samurai readers will eventually become millionaires due to disciplined saving and savvy investing over time.
Now that I’m in my mid-40s, in retrospect, I should have taken even more risk. Taking more calculated risk is a key theme if you want to become a millionaire at a relatively young age.
The second key theme to become a millionaire by age 30 is to own appreciating assets that work hard for you. Eventually, you will tire of the grind. When that time comes, you will hopefully have at least one million dollars in assets generating passive income.
Finally, if you really want to be a millionaire, you need to come up with a plan and follow it. When it comes to your finances, you can’t just wing it. You must be intentional!
How To Become A Millionaire By Age 30: Financial Upbringing
Growing up in a middle class household made me strong. My parents always drove beaters and frowned upon ordering anything other than water when we went out to eat.
I knew my parents were not rich because their incomes were in the public domain as foreign service officers. As a result, I made a conscious choice in high school not to attend one of the two private colleges that had accepted me. Instead, I went to William & Mary, which cost $2,890 – $3,200 a year in tuition from 1995-1999. I needed to save money.
We were by no means poor. We just pulled up to parties in a paint-less 1976 Nissan Datsun alongside Audis, Mercedes, and BMWs for the four years we lived in Kuala Lumpur, Malaysia between 1986-1990. It was very mortifying as a kid.
I knew nothing of expensive shoes because I had none. My wealthier friend gave me his old Air Jordans 4s that were two sizes too large. I couldn’t even afford a camera or a Nintendo game system. We led comfortable lives, but didn’t have more than we needed.
I was always curious about my wealthier friends. Many of their parents were business owners. So one day I told my father I too wanted to be a businessman.
By the time I was 13 I was hooked on every single episode of “The Lifestyles Of The Rich & Famous,” narrated by Robin Leech. A million dollar house and a $40,000 sports car. What a life! I thought to myself in the 8th grade. Might as well give it a go. That’s when I started really hitting the books.
Millionaire By 30 Money Mindset
If you want to become a millionaire by 30, you must adopt a strong money mindset. Know that there is money everywhere for the taking. You’ve got to believe you deserve to be rich.
Further, becoming a millionaire by 30 is becoming more common rather than the exception thanks to inflation. After all, $3 million is the new $1 million today.
There are so many standard ways to become a millionaire. If you don’t become a millionaire by 30, you will eventually get there with enough time.
If you work for 40 years and save and invest just 20% of your after-tax paycheck a year, there is no doubt in my mind you will amass at least one million dollars. Compounding is a powerful force.
Maxing out your 401K for 30+ years will also most likely lead to over $1 million dollars as well. Historical stock and bond market returns plus company match are on your side.
We’ve got financial planners, personal finance blogs, television, best selling books, and even free financial tools to help you build and track your wealth. So many resources make building wealth much easier now than in the past. Let’s look at three reasons why becoming a millionaire by 30 is easier than ever before.
Three Reasons Why The First Million Could Be The Easiest
1) Tremendous energy.
When we first graduate from high school or college, we have a tremendous amount of energy to show what we can do after all our education. We’re hungry, motivated, and need to prove to others and to ourselves our worth. 60-90 hour work-weeks are no problem!
Unfortunately, so many of us piss away our youth. We buy new cars without following my 1/10th rule for car buying. Some of us get into expensive credit card debt. And a lot of us don’t to our elders and think the world owes us something. Forget it folks.
Nobody owes us anything. But we owe it to ourselves and to our parents who sacrificed all that time and money raising us to give life everything we’ve got.
2) Fewer or no dependents.
Most of us won’t have children by the time we graduate from college. As a result, we can focus 100% of our efforts on generating wealth by developing our careers or our businesses.
Compare ourselves to middle aged adults with two children, a mortgage, and aging parents to take care of. We are like finicky Ferraris on a starting line ready to blow away our older model competitors.
I’m now a dad to two young children. As a result, I’ve got to wake up by 5 am every morning to write before my children get up. Otherwise, nothing would get done on Financial Samurai. By the time 1 pm roles around, I’m exhausted playing with my kids. Take advantage of your youth!
3) Nothing to lose.
When we graduate with nothing, we have nothing to lose. Compare that with people with property, stocks, and other investments during economic downturns, and they have everything to lose.
With very little assets, we should be taking more risks. Now is the time to start a company, invest in that growth stock, take a new job opportunity, or move half way across the world on a hunch that good things might happen. If we don’t take risks while we are young, we certainly aren’t going to take them when we are old.
How To Become A Millionaire By 30
I had no idea I became a millionaire at age 28 until two years later when I did my first detailed net worth spreadsheet in 2007. It’s easier to achieve something when we don’t even realize what we’re doing.
I was too busy saving, investing, working, and trying not to blow my money on things that I didn’t need. I was one of those “Super Motivated Boyfriends” (SMBs) who were impossible to lock down.
Like most people believe, 30 is a big milestone. Ever since college I told myself I was either going to make it, know that I was going to make it, or be an absolute failure by 30.
The fear of being a failure at 30 with no job, no woman, no savings, no investments, and no world experiences made me so motivated to not mess things up. I felt I needed to become a millionaire by 30 in big cities like New York and San Francisco.
A painful two years of working 70+ hour weeks right out of college with difficult bosses also got me into overdrive to figure out a way not to work forever!
There was no fanfare when I discovered the seven figure milestone had been achieved. Just the realization that time passes more quickly as we age. I had to make the most of my opportunities since nothing lasts forever.
Keep Aggressively Saving And Investing
Years later, I’ve continued to grow my net worth with a variety of passive and alternative active incomes. My family is a great motivator to keep on going. The last thing my wife and I want to do is go back to work while our children are still young.
If you’ve been reading my posts from how to save for retirement and how to properly invest for your future, there’s no magic behind wealth accumulation.
Amassing wealth is about savings, discipline, perseverance, luck, an X Factor, and the belief that you too deserve to be wealthy. Eventually you will have more than enough so that you’ll either retire or keep on playing for fun.
After leaving the work force for good at the age of 34 in 2012, I decided to keep on playing by building Financial Samurai into the best possible personal finance blog I could. When people tell me I’m lucky, I agree! As a result, I’ve tried to re-create my luck by writing 3-4X a week every year since 2009.
After 14+ years of writing on Financial Samurai, I believe one important secret to wealth and success is grit. If you can demonstrate unwavering commitment with one thing for at least 10 years, I strongly believe you will succeed. Too many people quit way too soon or right before the going gets good. Stay committed!
If I started this site in my early 20s, I would have become a millionaire by 30. If you are young, please take advantage of your youth.
The Road To One Million Dollars By Age 30
To the best of my memory here’s how I was able to amass a million dollars by age 28. Today, my net worth is much larger thanks to continual investing, asset diversification, and building multiple passive income streams.
Age 22. Year 1999. Place Your Neck On The Chopping Block.
When I graduated from The College of William & Mary, the total amount of cash I had was roughly $4,000. I had saved some money from summer jobs temping and flipping burgers at McDonald’s for $4 an hour. I had just started a dream job in New York City at Goldman Sachs. It was go time!
My base salary was $40,000, which at the time didn’t feel too great. I lived in a studio with my buddy from high school for two years because we couldn’t afford something nicer.
See: Achieving Financial Independence On A Modest Income
As a result, I invested $3,000 in a dotcom stock called Vertical Integration Systems (VCSY). It turned into $200,000 within several months. Yes it was incredibly lucky, but it also took some analysis and guts. I just wish I had more money to invest!
The stock pulled back by around 25%, at which time I sold everything for around $155,000 and stayed out of the bubbliscious stock market for the next year and a half due to a job change in 2001. VCSY ended up being worthless a couple years later. $155,000 equals about $120,000 in after tax proceeds. The trade is detailed in the post, Don’t Stop Fortune Hunting.
Net worth: ~$160,000.
Age 24. Year 2001. Taking An Employment Chance.
After two years in NYC, I was recruited to join another firm in San Francisco. I only knew a couple people in San Francisco, but felt the promotion to Associate without having to go to business school and 100%+ guaranteed raise to an $80,000 base salary + bonus was attractive enough to take a chance.
I was coming from a top firm and had established some solid client relationships over the past two years. The economy was still dicey due to the dotcom implosion and there was a big chance I would not make Associate after my third year at GS.
It turns out my firm in NYC did indeed let go of many colleagues, and only about 25% of the people I knew from my entering class were still there two years after I left. It was a little scary moving all the way cross country, but it wasn’t like I was moving to the middle of nowhere. This was San Francisco, one of the most beautiful cities in the world. Besides,
San Francisco is six hours closer to Hawaii, one of my favorite places on Earth, so I figured what the hell. I saved 100% of each bonus, maxed out my 401(k), and saved a little more for my after-tax brokerage account.
Net worth: ~$260,000.
Age 25. Year 2002. Continued To Live Like A Student.
The first two years in NYC, I lived in a studio with another guy. We put up one of those Chinese Paper Walls to add more privacy. I didn’t care. I was living in New York City, the most alive city in America. I’d rather spend money going out and partying rather than on an extra bedroom.
When I moved to San Francisco, I spent even less on housing since NYC is about 30% more expensive. I found a two bedroom, one bathroom apartment at the edge of downtown for only $850 a person. I finally had my own room, yeah baby!
When you now make double what you were making a year ago, yet pay 25% less in rent, saving becomes very easy. I increased my after tax, after 401K maximum contribution savings rate from 50% to 65%.
Here’s a post I wrote later called, Home Expense Guideline For Financial Independence. It highlights how I lived in NYC and SF to maximize disposable income. The post also gives recommendations on how much money you should spend on rent/buying in your journey as well.
Net worth: ~$400,000.
Age 26. Year 2003. Conservative Investments Before & During The Recession.
60% of every paycheck and 100% of every year end bonus after 401(k) contributions went into long-term CDs that yielded 5-6% at the time. The reason why I invested in CDs was due to a job change and not having time to manage my portfolio in 2001, 2002, and 2003.
Furthermore, I was scared of another market implosion that would not only take down my investments, but also my bonus, and potentially my job.
My 401(k) was already 100% exposed to the stock market already. Today, my net worth is highlight diversified across real estate crowdfunding, real estate, bonds, stocks, private equity, and business equity.
A day after my 26th birthday, I decided that it was time to grow up and buy my own place. I was renting a $1,600/month one bedroom apartment in San Francisco and wanted a nicer apartment.
At the same time, I didn’t want to spend more than $2,000 a month on rent because the return on rent is always zero. I became very disillusioned with having a large chunk of money in the bank and started wondering what is the point of working more since I had more than I could ever have imagined.
At age 26, I was already thinking of “retiring” in Hawaii. Given my waning motivation to work as hard anymore, I decided to buy a two bedroom, two bathroom condo in a nice area of SF and live it up a little!
The combination of 5-6% compounded returns in savings over four years, a growing 401(k), growing after tax investment account, and another year of saving a larger bonus really helped.
You don’t have to be a great investor to become a millionaire. You just have to be a good-enough investor with the proper discipline and risk exposure.
Net worth: ~$550,000.
Age 26-27. Year 2004. Renewed Motivation To Work.
After putting down a 25% downpayment (~$140,000) for a $580,500 condo, my motivation to work skyrocketed because of a drained cash account. I prayed the housing market wouldn’t implode like the stock market did years earlier.
A year before my condo purchase I did a silly thing and bought a $78,000 Mercedes G Wagon (G500). The truck was sweet and I thought it was a great deal since it was selling for $150,000+ the year before since this small dealership in Sante Fe, New Mexico curiously owned the US import rights.
I drove the truck for a year and had to sell it for a $20,000 loss because it wouldn’t fit in my condo garage due to the height! What an idiot, but I felt buying the condo was the responsible thing to do. I traded way down to a seven year hold Honda Civic worth $8,000 instead. I was growing up but still had the thirst for nice cars.
Having A Mortgage Was A Big Motivator
The $435,000 mortgage put a fire under my ass to work harder and be the best performer I could be. At the age of 27 I was promoted to “Vice President,” a title that is normally bestowed on business school graduates three to four years out of school at the age of 32-33.
From there, my income took another large jump up to $120,000 + a larger potential bonus. I became one of the youngest VP promotes in my office.
Debt provided an unexpected side benefit for my career. From 2003 to 2005 my condo also appreciated to around $815,000, a 40% jump. Unfortunately, this increase was unsustainable as we all know. In fact, one of the biggest downsides to paying off your mortgage is the loss of motivation.
I felt this way in 2015 once this condo’s mortgage was paid off. However, once my son was born in 2017, the motivation to make money increased again.
Net worth: ~$800,000.
Age 28. Year 2005. A New Landlord And Millionaire By 30
At 28, I decided to finally buy a single family house in San Francisco for $1,520,000. Believe it or not, $720/sqft for a house on the north end of San Francisco was pretty good because many homes were selling for $900/sqft at the time.
I was sick of having neighbors above and below me. I wanted a yard, a deck, reprieve from the HOA meetings, and to be king of my own castle. The bad thing about my house was that it was on a busy street next to the busiest street in the entire city.
After I moved into my single family house, I turned my condo into a rental, but finally sold it in 2017 for 30X annual gross rent because I no longer had time to be a landlord after my boy was born.
My rental property equity was around ~$350,000 plus around $750,000 worth of CDs and stock investments for a total net worth of around $1.1 million. I knew I was doing OK, but I had no idea I was worth over $1 million at the time. I was too busy building a business at work, managing a rental, remodeling a new home, and figuring out how to keep things going.
Note On 401k Investments: I put away the max 401K pre-tax contribution since my first full year of employment. At the time, the maximum contribution amount was $10,000 a year. The maximum amount is now $22,500 a year for 2023 and will likely go up by $500 every 2-3 years.
If I take six years times the average $15,000 = $90,000. The average company match was around $15,000 a year since we had match + profit sharing, so add on another $80,000 = $170,000 in my 401K by the age of 28. But actually, I had over $200,000 given it did return more than 5% on average for six years.
One of my 401K options was a hedge fund, where I put a 60% of my allocation during the downturn between 2000-2002. The fund actually did well given they had a net short position, so my overall 401(k) was able to take the hits. In fact, if you max out your 401(k) consistently, you will likely become a 401(k) millionaire after 20 years of contributions.
More Thoughts On How To Become A Millionaire By 30
I strongly believe most people reading this article can accumulate a million dollars if they have the motivation, a good amount of planning, the right amount of guidance, and some luck.
I’m sure some of you will have your own doubts, while others will scoff at how little $1 million is. But here are my suggestions for those who want to become a millionaire by 30 or at a relatively young age.
1) Don’t mess around in high school and college or else you will have a hard time landing a good job that pays well.
Give yourself optionality please. There are thousands of straight-A, top 25 university graduates every single year. I was one of the thousands, and it’s hard to compete if you are not one of them because employers can’t respond or meet with everyone. Grades matter.
Many firms such as Goldman, Mckinsey, Bain etc have GPA cutoffs of 3.5 out of 4.0, with some at 3.7. If you don’t have connections then you just aren’t going to make the cut when there are thousands of applicants for only 60 spots. You can rage against the machine and believe grades don’t matter, but you are going to be wrong like donkey kong and most likely regret your immaturity.
Getting a job on Wall Street was like winning the lottery for a kid coming out of a non-target public school. I went through seven rounds and 55 interviews over a course of six months before getting the offer. I would not have been able to even get an interview if I didn’t get good grades or show initiative.
Your job income is the #1 main source of wealth for most people. Might as well focus on the highest paying industries that you think you’ll enjoy if money is what you want to make. It’s important to note that no way is a large income a guarantee for lasting wealth as many millionaire bankruptcies have proven.
2) Save until it hurts each month.
Remember this Financial Samurai saying forever. If the amount of money you’re saving each month does’t hurt, you’re not saving enough.
When you’re a college student, you’re poor. Hence, even if you graduate and only make $30,000 a year, I’m willing to bet that’s more than you’ve ever made in your life! Try to continue living like a student for years after you’ve found your first full-time job and save!
Stop making excuses why you need to buy a nice car and nice clothes. You’re a 22 year old recent college graduate for crying out loud. Build your foundation in your 20s and stop thinking you have a decade to explore, because you don’t. 10 years maxing out your 401(k) will likely result in a $200,000 portfolio in your early 30s.
The base you build in your 20s will provide tremendous returns for later on in life. If you stay consistent over the years, you will get there. Aim to save at least 20% of your after tax income every year, no matter what.
3) Work hard and know your place.
If you want to be a millionaire by age 30, you must work hard. Working hard takes NO skill. If you’re not coming in first and leaving last, you aren’t putting in your time. Be irreplaceable. Be remarkable.
I promise you if you wake up by 5am every morning, work one to two hours before the rest of your peers and work another one hour after your peers have left, you will get ahead! Avoid career limiting moves that will severely curtail your future.
The reason why I was promoted to Vice President at 27, when the average VP promote is 33 is because I put in extra dues. I generated millions of dollars in revenue, built a solid network of internal supporters, and was a workhorse by coming in by 5:30am everyday for my first two years and leaving at 7:30 pm-8 pm on average.
Sometimes I even left work at 10 pm. Did I sacrifice some of my social life? Of course I did. But, I also partied hard many weekends! Working hard doesn’t mean you can’t also play hard and travel. You’re young remember? Your energy is limitless!
4) Stop making excuses.
You can spend time crying why the world isn’t fair, or you can do something about your life. If you are reading this post, chances are you have clean water to drink, shelter, internet and a legal system that protects your rights.
There are millions of people in the world who are starving every single day. An equal amount who live in fear of dictators confiscating everything they own. Some immigrate to America for a better life, don’t even speak the language and crush it. What is your excuse? Abolish welfare mentality.
Spend 30 minutes every day by yourself in meditation coming up with a better business model for your company or for own business. Spend four hours every weekend in the office studying up on new things that will help improve your standings with your clients.
You can even start a blog and work an extra 30 hours a week online before you have a family and generate some healthy revenue if you wish. Let’s take advantage of the freedom our respective countries provide.
5) Consider both aggressive and conservative investment strategies.
When I was 22, I only had about $4,000 to my name. Regardless, I invested 80% of my money and it turned into a 50 bagger. Was I lucky? Hell yes! But, I did my research and was I willing to put my balls on the line to try and make some money.
I think it is very important to take more risks when you are young which is why I’m biased towards growth stocks over dividend stocks. With the proceeds from my VCSY China internet trade, I transferred my wins into long-term CDs and then ultimately into property.
When you are ahead, it’s very hard to walk away. As a poker player I know this feeling all too well. But it’s tantamount to invest a portion of your winnings in a safe haven. Lock it up. Protect yourself from yourself!
I didn’t take on the reckless mentality of betting the farm with my windfall since I was now playing with the “house’s money.” This was my money now dammit, and I wasn’t about to piss it away on some B2B stocks. Continuously diversify your income streams and build passive income.
Today, I like the combination of growth stocks and less volatile real estate investments. You must take the appropriate amount of risk exposure. Otherwise, you could end up losing a lot of money, which ultimately means lost time.
6) Property is one of your best friends over the long term.
If you put 20% down on a property and it goes up 3% a year, that’s a 15% return on your cash thanks to leverage. Sure, you can get your face ripped off if you bite off more than you can chew. But trust me when I tell you that thanks to inflation, your debt payments will seem insignificant five years afterward.
Five years later, you will be happy every month when you get to charge a rent that is much higher than the interest portion of your mortgage. Property is my favorite asset class for young people to build wealth.
I sometimes feel guilty raising the rent, but remind myself, I was the one who took the risk, put down the downpayment, and nobody forces anybody to rent my place. Real estate is my favorite investment asset class to build wealth. The condo I bought on my 26th birthday for $580,000 was fully paid off in 2015 at the age of 38. A neighboring unit with the same layout sold in 2017 for $1.36 million.
I’m now investing in real estate crowdfunding to take advantage of lower valuation properties with higher cap rates in the heartland of America. I want to invest in the next San Francisco Bay Area over the next 20 years, and lower cost of area cities like Memphis, Austin, and Salt Lake City look attractive to me.
My two favorite real estate marketplaces are Fundrise for their eREITs and CrowdStreet for their individual commercial real estate investments in 18-hour cities. Both platforms are free to sign up and explore.
After explosive stock market gains during a pandemic, money is likely going to flow into real estate. Mortgage rates are at all-time lows, corporate earnings are rebounding, and all of us are spending more time at home. As a result, the intrinsic value of real estate is going way up.
The value of rental income has gone way up as well. The reason being is that it takes a lot more capital to produce the same amount of risk-adjusted income. Real estate and technology sectors tend to do best in a rising interest rate environment.
7) Pretend you are poorer than you are and show few signs of wealth.
Stay humble despite amassing a fortune. Don’t show off or waste money on things you don’t need. Make people believe you are younger and poorer than you really are. I drive a 13 year old car and wear t-shirts, jeans, and a baseball cap most of the time. Once you’ve accumulated your war chest, practice Stealth Wealth.
I would say at least 80% of the millionaires I know are very low key. You can’t tell they have a lot of money except for when you get to their house. The only people who want attention are those who are insecure, not not really rich.
8) There are more ways than one to rub a furry koala.
You can make big bucks through a day job or by starting your own online business. Better yet, you can do both. While I was working in finance, I launched Financial Samurai. I worked on it before I went to work and after I came home.
Since starting this site in 2009, Financial Samurai now generates enough revenue to provide comfortably for a family of four in San Francisco. In fact, FS started generated enough for us to live well starting at around 2013. You just never know until you start something new.
To become a millionaire by 30, you must work on your X-Factor. Your X-Factor is what will bring you more wealth, happiness and joy. But the key is to work on your X factor long before you need it!
9) Office politics counts.
In order to get ahead, you’ve got to play the game by building as many company allies as possible. I don’t know many people who like to sell themselves internally to their colleagues and bosses. People think that all it takes is good work to get recognized, paid, and promoted. This is absolutely false!
You must sell yourself internally as much as you sell yourself externally. I believe you need to sell yourself 50% internally and 50% externally.
Don’t think just because you’re bringing in business that you will automatically get paid and promoted. You must build a support network of powerful people at your firm. Once you have someone with significant power on your side, your entire career gets that much easier.
10) Regularly invest in yourself.
If you want to be a millionaire by 30, then invest in yourself. Your greatest money making asset is you. Don’t cheap out on education or consulting. Education is worth more than any material thing you can buy. My studies in college and grad school taught me how to market, negotiate, communicate, analyze investments, and influence.
Thankfully, you can now learn most everything for free thanks to the internet. It’s hard to recognize value when you can’t touch it. However, I promise you that knowledge and education is worth more than everything else.
The more you learn the more you can earn! If you haven’t already, join 55,000+ others and sign up for my free weekly newsletter. Subscribe to my podcast and my posts via e-mail.
11) Diligently keep track of your progress.
How much you keep is even more important than how much you make. There are people who make millions of dollars and end up broke years later. The simple reason is because they had no idea where their money went. Perhaps they made some ill-timed investments.
Maybe their risk exposure didn’t align well with their risk tolerance. Or maybe they simply just spend too much. Everybody should leverage Personal Capital, the best free financial tool online. With Personal Capital, you can track your cash flow, analyze their investment portfolios, and calculate their financial needs in retirement.
12) Regularly turn funny money into real assets.
We will regularly go through boom bust cycles. The key is to consistently turn that funny money you made in the stock market into something real. Do not stay all-in all the time when you have a nice windfall.
So many people have ended up losing all their money in the 2000 crash. Then came the 2008-2009 crash. Most recently was the March 2020 crash. Boost your wealth by using your windfall gains to buy a more stable asset like real estate or fine art. If you do, your chances of becoming a millionaire by 30 will increase.
With stocks at all-time highs again, I’m taking about 10% of my winnings and spending it on a better life.
13) Consistently recognize your luck
To become millionaire by 30 requires a ton of luck. If you start believing all great wealth is mostly due to hard work and skill, you decrease your chances of becoming a millionaire. The reason is because you may start taking your opportunities for granted. You also start getting arrogant.
Not everybody has equal opportunity. For example, people’s chances of becoming a millionaire are different by race. Stay humble and hungry.
14) Invest for the long run
Your first million really isn’t the easiest now that I’m much older. Once you accumulate several million dollars, you will find it much easier to make another million dollars in net worth.
Therefore, your key is to grow your capital to a sizable amount and make continued risk-appropriate investments. For example, if you have five million dollars in invested capital in the S&P 500, and it goes up 20%, you’ve just made one million dollars without doing much work.
15) Keep on reading and learning about money
Millionaires are voracious readers. We’re always learning in order to continuously grow our finances in a risk-appropriate manner. There is always opportunity!
If you want to dramatically improve your chances of being a millionaire, read my instant Wall Street Journal bestseller, Buy This, Not That: How To Spend Your Way To Wealth And Freedom. The book is jam packed with unique strategies to help you build your fortune while living your best life.
Buy This, Not That is a #1 new release and best seller on Amazon. By the time you finish BTNT you will gain at least 100X more value than its cost.
After spending 30 years working in finance, writing about finance, and studying finance, I’m certain you will love Buy This, Not That. Remember, the more you learn the more you can earn.
Align Your Beliefs With Reality
One cannot downplay the importance of luck in becoming a millionaire by 30. I have been fortunate to have two loving parents, an incredible spouse, and a brain that works most of the time.
If you’re born in America, please take full advantage of all your opportunities. Despite having a deficiency in higher level math, uninspiring SAT scores, and a run in with the law as a teenager, I made up for my weaknesses with plain old work ethic and relationship building. It also helps to be an undying optimist as well.
You can’t complain about not having wealth if you decide not to pursue wealth. That’s a mental misalignment. The desire for wealth shouldn’t be viewed as evil. It should be viewed as natural for anybody who wants to live a better life. Who doesn’t want to b a millionaire to take care of his or her family and parents? Further, by being a millionaire, it’s easier to give back to the community.
As soon as we align our realities with our beliefs, we become congruent and happier with ourselves and our outlook.
Good luck on your journey to your first million! Becoming a millionaire by 30 is a great accomplishment. Once you get there, that’s when the real fun begins.
Become A Millionaire Through Real Estate
Real estate is my favorite way for the average person to become a millionaire. Using other people people’s money (a mortgage), you can buy a real estate that tends to appreciate in value over time. Meanwhile, inflation whittles down the cost of debt. This one-two combination helps create a significant amount of wealth over time. Let inflation be your friend, not your enemy!
Roughly 40% of my net worth is in real estate. Further, real estate accounts for roughly half of my estimated $300,000 a year in annual investment income. One irony of real estate is that because it is less risky than stocks, investors can actually end up making much more from real estate.
I think the best strategy is to ow your primary residence to at least get neutral real estate. Then diversify by buying rental properties in your city, public REITs, and commercial real estate.
Take a look at my two favorite real estate crowdfunding platforms:
Fundrise: A way for accredited and non-accredited investors to diversify into real estate through private eREIT. Fundrise has been around since 2012 and has consistently generated steady returns, no matter what the stock market is doing. For the average investor, investing in a diversified eREIT is the way to go.
CrowdStreet: A way for accredited investors to invest in individual real estate opportunities mostly in 18-hour cities. 18-hour cities are secondary cities with lower valuations, higher rental yields, and potentially higher growth due to job growth and demographic trends. If you have a lot more capital, you can build your own commercial real estate portfolio.
Both platforms are fee to sign up and explore. I’ve personally invested $810,000 in 18 real estate crowdfunding projects since the end of 2016. My goal is to diversify, take advantage of real estate arbitrage, and earn income 100% passively as a busy father of two young children.
I’m bullish on real estate as we come out of the pandemic. The combination of higher rents and capital appreciation is a powerful wealth-building combination!
Keep Track Of Your Finances
Whether you become a millionaire by 30 or by 50, one of the most important things you can do is to stay on top of your finances. The better you can track your finances, the better you can optimize your finances.
I recommend using Personal Capital to grow your wealth. It is a free financial tool which helps track your net worth. It will also help optimize your cash flow, plan for retirement, and reduce excessive fees.
Before Personal Capital, I had to log into eight different systems to track 35 different accounts to track my finances. Now I can just log into Personal Capital to see how my stock accounts are doing. Further, I can se how my net worth is progressing.
Their 401K Fee Analyzer tool is saving me over $1,700 a year in fees I had no idea I was paying. They’ve also got a great Retirement Planning Calculator. It uses real data and Monte Carlo simulations to produce realistic retirement results.
There is no rewind button in life. It’s best to get your finances down the first time around. Once you’ve become a millionaire or multi-millionaire, you have more freedom to do what you want. And the freedom to do what you want is all someone can ever ask for!
You can also sign up for my free weekly newsletter here. 55,000+ readers have since 2009 to help them build more wealth and live a better life. How To Become A Millionaire By 30 is a Financial Samurai original post. Today, I am a deca-millionaire through consistent saving and investing.
Awesome post Sam! :-)
I just sent a text to my nephew so that he’ll understand the reasons WHY he should save as much as he can while living at home until he gets a place of his own in 5+ years hopefully.
Curious why you chose the Excel spreadsheet to track net worth over something like Quicken (or other products now) that can download all that information to put it in a single place for you?
Cool. I chose Excel because I’m very familiar with the program as someone in finance and can really customize the tables. Besides, it was free. ;)
29 is still young! Good luck in your journey. Time starts flying once you hit 30, it’s kind of scary. Enjoy the path too.
The mass media and the government are powerful. It’s all about pitting Wall St. against Main St. Like anything, it’s important to differentiate between individual people and corporations.
Hi JT, when I first started funding the 401(k) I had a more conventional notion of retiring at 59.5. However, after my first stub bonus for half the year and seeing how much was taken in taxes (NYC City, STate, Federal) and the amount of work required, I knew I couldn’t last for 47.5 years. I thought if I could last 5 years I’d be lucky.
I didn’t care about not being able to touch my 401(k) until 59.5 b/c it made me feel good not to pay taxes on my contribution amount. I used my 401(k) as the ultimate tax shelter based on my income at the time and BONUS money if I got to live until 60. Besides, thank goodness for RULE 72t which allows for early withdrawal!
I wish I bought the 2/2 condo I was eyeing in NYC in 2000 on 22nd between Park and Madison for $700,000. It would be worth $1.5 mil + now. I also wish I kept fortune hunting in the stock market.
Sam,
This is the post that needed to be written so that your readers can benchmark themselves. I was lucky with a few investments prior to the 2008 crash despite not fully committing to investing and growing my wealth. The most lucrative investments I made lost money early, especially in 2008-2010. The market crash has helped me make up tremendous ground to the point where financial independence is less than 10 years away, maybe even 5 if my investments pay off. Is your third property the house in Kaimuki? Is it vacant or rented out?
My wife and I are ahead of your above average new worth calendar with decent incomes, we’ve been very lucky Hawaii like SF didn’t suffer in the real estate downturn. My problem now is most of my wealth is tied up in real estate and retirement accounts, not very liquid. I don’t plan to liquidate any real estate holdings as I plan to leave them to my children when I have some. Now we are focusing on building up our taxable accounts while still maximizing all retirement accounts.
Sam you definitely should have more posts like this, especially for naysayers. I can only handle so many blogs that write about the chocolate bar they bought which caused them to go over budget.
Charles, My third prop is in California. I don’t count Kaimuki b/c I did nothing to deserve it and it’s not solely in my name either.
For liquidity, I’d work on your X Factor b/c as you know, cash flow is king.
It’s interesting, but the only naysayers I’ve had recently are the religious dividend investors who swear by dividend investing for early retirement and are against growth stocks and everything else. It’s weird how unflexible their thinking is, even after highlighting the Chinese Internet Stocks example in May and them playing out by 50%+ three months later. They want to retire early in 10 years with their $100,000 dividend portfolio that they think will grow 10X in 10 years. It’s interesting!
Sam, you know as well as a lot of other folks that being too heavy in any given thing is probably not a good thing. That goes for Dividend/Growth/RE investing. :-P
Hi Sam,
Great post. You have an impressive track record, that’s for sure!
I hit $1M at age 34, the year I got married to my wife and 1 year after moving overseas…
It could have been sooner if I took money off the table with the company options and share purchase plan in 2000 but instead I ended up riding it down and changed jobs to a start up that crashed and burned 10 months later in early 2002. Then I spent a year trying to get into a new job and started over again- so it was worth all the lessons learned in hindsight, plus I have to say that my life was all the richer for it.
-Mike
Hey Mike, nothing like the 2000 dotcom roller coaster to keep things real!
How do you plan to spend your millions in Thailand? Because that’s like tens of millions there!
Hey Sam,
I’m not sure if I’d agree with that statement. Thailand is the 2nd largest market for luxury German cars, a lot of people are making some serious coin out here and they are locals.
Foreigners can’t own land, only via condominiums and the land prices in downtown Bangkok are truly mind boggling. Example: a detached house on a 1/3 – 1/2 of an acre in downtown Bangkok is about $20 – 30M USD- and is very rarely on the market as it is usually snatched up by a developer who then aggregates the land with another plot and builds a condo there and makes a tidy profit.
However we have a baby so need more space- the 2 BR / 2BA condo that we’ve lived in the past 7 years is just getting too small… so I went out and purchased a nice second hand condo- it’s a duplex penthouse on the 29th and 30th floor of a condo with very nice views of the city, and a small view of one bend in the river- it has been wonderfully decorated and I bought it fully furnished and decorated for $600K USD- and this is for a 2500 square foot place (4 bedrooms / 4 Bathrooms)- it feels like a house because it’s on two levels and the location is great. It was a good cash outlay but one that I think is worth the money.
That’s how I’m spending my money – that and baby related stuff!
-Mike
Sounds like a worth purchase to me Mike. Depending on location comparison, that place could easily go for $1.5-$2 million in SF!
Time will tell, my friend.
-Mike
Hey Sam,
Just curious but what was your net worth outside of real estate when you “retired”?
Mike
Hi Mike, it was more. How about you?
My NW is about 35% real estate.
Recommended Net Worth Allocation By Age And Work Experience
Sam,
My NW is entirely tied up in stocks. I believe I’m a year younger than you. I’m trying to determine what amount I should draw the line at where I could potentially no longer work and generate passive / business income.
When your passive and other side incomes cover 110% of your monthly nut.
I love how on one hand you were willing to put just about every dime you had into a risky investment, but on the other you are a millionaire driving a 13 year old car. It is a rare combination of being frugal but willing to take risks. It clearly worked out well.
I love cars, but I love Moose more. The more we go on roadtrips, the more I can’t sell him despite all his issues. It really is all about spending money on experiences.
Have you ever read the book from Thomas Stanley called “The Millionaire Next Door” or “The Millionaire Mind”?
The funny thing is that even the Decamillionaires won’t spend more than $30k on a car, until they’ve achieved multi-millions in assets.
Excellent post! I know you’re really putting yourself out there, but showing all the juicy details is the best example you can give and very helpful for those trying to follow the path. Plus, I’m sure you will see a nice uptick in traffic.
I’m on my way to $1M and should cross the line in a few years at about age 30. Similar to you, this is from a combination of hard work, a good degree, a lucrative engineering job, and working hard on weekends and when the workday is over! Now that my family is growing and consuming more of my time, I can look back and appreciate the hard work setting up multiple income streams when I was younger.
Thanks again for sharing and educating!
You’re going to love all the fruits of all your hard work once you hit 30. The best thing about hard work is that it is OVER, and yet it keeps on giving often times.
Enjoy!
Great advice! My journey was different, but similar in some respects. Taking risks is key to success. Investing in income property is very rewarding and taxed at capital gains rates. I love the idea of my tenants paying for my mortgage and costs of ownership! I reached the magic number in my early thirties, but i included my personal residence in those days. I no longer do that for conservative reasons since you have to live somewhere and it skews your net worth.
The theme of your advice is to do well in your career and invest wisely. The road to wealth has a lot of paths, but your advice works no matter what path you take.
Taking calculated risk really is so important. For those who want to achieve FI early, but are unwilling to take more risk than CDs or dividend stocks, it’s going to be tough b/c often times saving a lot to live like a pauper isn’t enough.
Love this article. It’s incredibly inspirational and at the same time makes me feel poor in comparison. Had this blog started in 2004 (when I graduated and got my 1st real salary job) and that I had known about it, I could be at least one-half millionaire by now. I don’t make as much money as you did, but I also live in a low cost area so having $500K after 9 years of work would still be pretty fantastic.
Keep up the great blog. I love shopping and your articles help me liking it less.
Totally agree Tina about the shopping thing!
Sorry for making you feel poor in comparison. It’s one of the reasons why I don’t like to publish these articles b/c I have so many readers from all sorts of backgrounds. It’s why I constantly emphasize the high cost of living in SF, Manhattan, etc and how everybody’s financial requirements are different.
$500K after 9 years of work is very fantastic, especially if you are living in a low cost area.
I LOVE window shopping. It keeps me satisfaction when I walk away from the car dealer with money intact!
Great post. Just remember that $17.5k is NOT maxing out your 401k. That is the max employee contribution. Your employer can contribute another $33.5k for a total of $51k/year in 2013. If you are below that, well… find a way to become the employer if you can. I’m not saying everyone can do it, but anyone can do it.
Great point Jamin. Thanks for sharing. $51K a year is such a powerful total contribution that will certainly create millionaires over time if people can afford to figure out a way to contribute that much!
FS, am loving the licentiously expressive idiomatic discourse! Especially appreciate “(t)here is no right or wrong way to rub the furry koala.” If rubbing the furry koala is wrong, I don’t wanna be right!:-)
Seriously, your story and achievements are always compelling, and your parents can take great pride in your accomplishment, too. Thanks for sharing this part of your story.
Thanks JC. Nobody else likes rubbing furry koalas it seems except me and you!
Great post Sam. Can you write detailed posts about your experiences wrt buying the rental and also the house in SF. As you know market is crazy in SF so any insight you share would be helpful
Hi John, I think you’ll enjoy this post on How To Properly Value Analyze And Invest In Real Estate.
I don’t even know what to say…seriously amazing. Inspiring. A million in 6 years, in your 20’s!!!! Most 22-28 year olds are partying and rounding the corner towards their first BK.
By comparison I’m just getting STARTED at age 28. Thank you so very much for sharing your story and I hope that you share more.
It’s also so very nice to hear how much you thank your parents and your upbringing for your core value system. I am sure your parents are beyond proud of you!
Are most 22-28 year olds rounding the corner towards their first BK? Things cant’ be that bad, we got Bernanke and Obama! :) I think most of my classmates at GS have gone on to do pretty well in different capacities.
I’m really so grateful for my parents and the experiences and teachings they gave me. I was a naughty kid growing up through high school and had to be set straight. Best of luck to you!
Most 22-28 year olds, most of which did not go to GS, or college at all for that matter. Yes, most twenty somethings are THAT irresponsible with money. If they can even get their credit to BE good enough to get that far in to debt in the first place. Most twenty somethings are just broke and spend whatever money or credit they have on “living in the moment”. Amazing that you had the self control and foresight to not. No need to be modest here, I mean really, you were just so far ahead of the pack. It’s truly inspiring.
You were naughty but still got good grades! I sort of have to admit I was the same way in the first half of high school.
Gotcha. Well, I really messed up when I was younger, so I felt I HAD to do really well in college to make up for all my deficiencies.
And b/c I was pounded to a pulp my first 1-2 years in NYC, I knew I should save as much as possible since I knew I couldn’t last. Moving to San francisco saved me. It bought me 11 more years since life out here is more balanced. I lost all the weight I had gained while in NYC and saw daylight again.
But yeah, I hear you on “living in the moment,” running up credit card debt, living the fabulous lifestyle young and so forth b/c I just met someone who is 26-27 going through that now. Delaying gratification is hard when you have rich friends living it up who don’t have to do anything. I might have to write a post about this. It jolts me to experience a friend go through this.
Omg I can only IMAGINE how NY gave you thick skin, Goldman at that time too, sheesh wow!!! Glad SF saved you, what a breath of fresh air it must have been. And then you were at a company where you talents were really able to shine.
Please do write about it! Hopefully more twenty somethings will stumble upon your blog and be inspired by the article and change their ways earlier.
I didn’t go into debt or live a fab lifestyle during said time period, I had kids and got married early–I guess I can say that sort of saved me. But 20-23 were some crazy times and I did see a lot of “living in the moment” in the LA/OC socialite scene. I wanted to do get it all out of my system early and not have a mid life crisis and become some crazy coug at 40 because I “never got to experience it when I was young” kind of thing LOL. It is nice knowing and not wondering that being a model partying with celebs and financiers it’s not all that it’s cracked up to be. Very relaxing living an inconspicuous, anonymous life now, focused on family, saving, and investing. No one would EVER guess that I was who I used to be. I am sure no one would ever guess at your naughty past now as well =)
Ahhh, the “model partying w/ celebs and financiers” life. Love it and loved it! Bottle service, car service to Atlantic City, last minute trips to Vegas…… it would be a fun, fun book to write. I’d much rather now be seen as a boring old fart now though. More fun to surprise on the upside.
Yes, I do think it’s great you got it out of your system. And to be able to find someone, have a family, and make $250K by 30 is an enormous accomplishment. Think about how life would be if you never found someone? That happens A LOT in the competitive world of finance b/c we’re so busy working on our careers.
Just looking at your overpaid GS buddies is absurd. Most people don’t work at GS or another brokerage house. My dad was a partner at Goldman Sachs who made more money than you ever will in your whole life. But, his life is not representative of the average person’s.
Congrats for growing up rich! Could you share what it was like and whether he was happy?
I decided to leave finance at 34 because I no longer enjoyed it.
Did your father support you a lot as an adult eg buy you a house etc?
See: https://www.financialsamurai.com/bank-of-mom-and-dad/
My other question is how you feel about your career and own wealth since your dad was so successful? Does his success out extra pressure on you?
Thanks
This is my favorite post so far. Thank you for sharing your journey – it is really cool to see the progression.
What was your networth when you left your last employer? Do you have any regrets – like, do you wish you had stuck it out for another 5 years and compounded your networth more aggressively, or are you confident you exited at the right time?
Regarding 401ks, the numbers you’ve previously posted are painful to read for young professionals since we lose so much investing time in our 20s in school. On top of that, my employer “lured” me in with the highest salary offer at a time when I wasn’t financially literate enough to consider the entire package, including benefits. My employer has never contributed to my 401k through a match or a profit share. All things considered, I would have been financially better off going for lower salary/better benefits. Not a big deal, but it still hurts a little.
I got to my first million at 30 through real estate – more specifically, buying dirt cheap single family homes in Arizona throughout the recession.
Take a look at this post on The “One More Year Syndrome” about regret (https://www.financialsamurai.com/2013/07/24/overcoming-the-one-more-year-syndrome/) and doing something you really want to do. I knew that my biggest regret when I’m old would be NOT taking the leap of faith to try entrepreneurship. I have my fill of work and money after 13 years. I’ve been wanting to be an entrepreneur since college.
I read that post – I have in my mind that it will take $5m in non-personal residence networth to feel safe enough to break free from the golden handcuffs. There has to be some kind of psychological study about what keeps people going back to the same job everyday rather than taking a risk like you did (which, based on reading your blog, seems to have paid off ten-fold in terms of quality of life).
I think $5 million is an excellent figure to shoot for. That would provide guaranteed $140,000 a year in passive income if you dumped it all in 10-year treasuries.
The psychological shift is the realization that life is short, your friends and people you know start getting sick and dying, and a deep introspection about how much money you need to be happy.
We writers are constantly delving into issues b/c we need to figure out how to convey our thoughts properly. I think if more people sat down to meditate, write, review, and look within, it’ll easier to find individual answers.
Sam, this list/timeline is amazing. Thanks for sharing. I’ll be sending this to my bro, who should be graduating from college soon.
Best of luck to your bro! To have the whole world ahead of you…..
Thanks for sharing!
Nice post, Sam. I always like hearing about how people got to the point they’re at today.
I wish I knew how important office politics was at the start of my career. Having connections and people in a position of power that will vouch for you goes further for your career advancement than just about anything else. Recently I’ve been going through a series of interviews for a job that I probably wouldn’t have gotten looked at twice for if it wasn’t for some of the connections I made that stepped up to the plate for me.
Selling yourself internally really is important. The star only shines so bright until you run out of energy, performance, or colleagues who move on.
Good luck with the interviews!
“If the feedback is good, perhaps I’ll share more details in the future.”
I encourage you to do so – I thoroughly appreciated this post. Getting insight from someone who has actually achieved such accomplishments is much more valuable than reading it from someone who is just theorizing. In any case, I think your story very much proves the notion that if you work smart and hard, then you create your own good luck.
Ahhh, the act of pontificating what we don’t really understand is a right of passage in the content/media world! :)
Will try my best. It is fun to theorize though. Some get very wealthy theorizing, like teaching someone how to get a job even though they’ve never had a job!
Wow thanks for all the insights and advice! That’s pretty crazy you didn’t eveb realize you hit 1 million until afteer the fact. I guess it’s fairly easy to do that when you’re hustling every day. I think there are tools nowadays that help make it easier but the momentum, drive, discipline, and energy it takes are still just as hard. Nothing comes easy and I think a lot of younger Millenials have a hard time with that. I’m on a tight budget for the next few months since I splurged on scuba diving school. But saving is fun for me because it makes the occassional treats that much more special and rewarding. I’m not at a million yet but one day I think I’ll get there.
Scuba will be fun Sydney! I can’t wait myself. But being in a pull all day for two days and the cold waters of Monterrey kinda bite!
This is an awesome insight Sam, thanks for sharing. I think I need to learn a few lessons from you about internal politics. I need to better position myself for the next promotion. That’s the easiest way to increase your income!
For sure Eric, I plan to write a detailed post on office politics for you and others. It really is such an important thing to master.
I would reallly like to second this request. That you became a VP so young means you really did something special there and I need to take notes. Detailed notes.
The advice you have been giving me in these comments sections has really been helping. I don’t know if I’m getting closer to a promotion or need one at this point until the pay is right like you said, but I did give myself and attitude adjustment and have been making an effort to make more personal connections and internal supporters. I’ve already noticed a big difference. Big. Like, I’m amazed.
Sure, no problem. The attitude adjustment is key. Think, “Thank you sir, may I have another!” as uttered in Animal House long ago.
Omg, right!!!! I actually emailed upper management the equivalent of that statement two weeks ago. Long story short I got an email lashing me because my numbers were down in one area. The old me would have defended myself by pointing out the fact that in the same time period I broke several company records overall. I wanted to say that. But instead I thought of you, and I THANKED them for only expecting excellence of me (knowing that the email would be forwarded to their bosses as well since I knew they were the real ones asking). I actually swallowed my pride and thanked him for the lashing!!! and then I started staying even later to improve my numbers in that area every day since. And because I had been staying later, I was available for a call that a few days ago that lasted to 8:30 PM EST (I come in at 5 AM PST) from the President on deal that honestly probably wouldn’t have gone through if we didn’t have that phone call and I didn’t get his support. Funny enough that call wasn’t totally about that deal, we were like, chatting. Remember that company outing my boss got mad at me for not being at? He brought that up…he really did want to meet me…etc. And in the AM the deal was approved. Domino effect from that one day when I decided to say “thank you” for the lashing, lash me again instead of getting scrappy. I’m truly amazed. But I still want your article on office politics!!! I know this is just scratching the surface.
Epic post, Sam. I really appreciate the This Is Your Life perspective from the Samurai.
I can relate to your GS Lotto Ticket as I think I hit the Big Four Lotto Ticket around the same time.
But I didn’t pull in the cash you did, that’s for sure.
No million for me yet, but dammit man, where’s your Roth IRA? I kid, I kid…
No problem mate. The Big Four Lotto Ticket is sweet. I got rejected from them left and right in college because I didn’t know a thing about accounting.
Enjoy your ROTH! Ha!
I can’t pinpoint the day I actually became a millionaire, but I do remember the day my liquid assets ebbed over $1M at 32, it was a pretty proud moment (one that took years for me to tell even my parents)…I could not agree more with Sam that you have to work your ass off and take chances swinging for the fences when you are young with nothing to lose. Insourcelife mentioned in his post that a large portion of Sam’s worth came from certain bubbles or unique events…I’d argue that there are those opportunities in every type of economy and in any industry you can think of. I’ve built my wealth in Automotive during the darkest days of the industry by working harder than everybody else, coming up with a better mouse-trap, being humble, and remembering how critical customer service is. Yep, I saved and reinvested about 70% of my income as well along the way. You have to trust in yourself, I can still hear the disappointment in my parents voices when I told them I was going to leave a cushy 6 figure job with a big company at 27…the risk was unimaginable to them & for the first few years I “feared” they were correct because it was hard as hell, I was too stubborn to fail and they are now extremely proud when they see what was created with hard work and ingenuity. Honestly though, if I had 2 kids and a wife to feed like I thought I would have in my late 20’s , I might not have made the same decision…funny how life works out sometimes.
Great point on taking advantage during the darkest times. Heaven knows the auto industry went through a ringer. I’d love to read your story in more detail through a guest post one day.
I’m always intrigued by folks who leave 6-figure jobs at a young age to go out on their own. I didn’t have the guts until 34.
I’d be happy to share my journey one of these days…it seems like there are a lot of ways to get to Financial Independence, but the one common theme 99% of the time is a lot of hard work, delayed gratification, and taking a risk or two.
Well, that and another drain is children upon one’s ability to build such a networth.
Kudos to you for making the choices you did to get to where you are today!
Thanks for the advice! Great article!
Your welcome! May your career be bright and prosperous.
Good post and I generally agree with your suggestions. However, a large portion of the skyrocketing net worth in your 20s was due to real estate and the dotcom stock. Both might be tough to replicate going forward. The idea behind it – taking risk when you are young – is solid of course, but luck/bubbles/timing all played a huge role and it’s not something that can be copied. Saving and investing is still a foolproof plan to get to that 1 million net worth, but it might not happen before you hit 30.
Indeed. I was lucky, especially making real estate and stock investments during two major crashes.
Sooner or later someone will get to their milestone if they stay the course.
Look at turmoil as opportunity.
Many young millionaires face problems of keeping up with the tempo and speed, but it seems to me that you have laid a very strong foundation, so wishing you good luck building on it!
Thanks Kostas. The tempo is very slow now that I pulled the ripchord last year.
We should hit the 1Mill point about the time I retire from the military (5.5 yrs at age 42). Stories like this make me wonder where I would be now if I had gotten serious about saving early in my twenties. Interesting article Sam, thanks for exposing yourself in your financial underwear! I’m sure your number is a few notches higher by now.
I’m curious, did self doubt ever become a major player in your saving years? Also, where does it end Sam? Is there a ceiling to your goal of growing your wealth?
Thanks, Chris
Good stuff Chris! $1 million by 42 working in the military is awesome. I’d love to read a more in-depth post of how you got there too. The pension is going to be sweet and allow you do do whatever else you want.
I had lots of doubt in 2001 after the dotcom bubble and two years in NYC b/c the economy was so bad. Luckily I was able to secure a position at another firm before my 2 year analyst program was done.
I don’t think personal finance ever ends. It just evolves to what you think is the ideal balance. I don’t have as much interest in making money anymore. If I did, I would have kept working!
I believe, especially early on in a career, that the ability to job hop to go after opportunities is a serious asset and can allow huge increases in income levels. Post college the region of the country I was in was depressed and jobs of any kind were scarce, I only got ahead by moving out of state, and out of the region in general. Many of my classmates didn’t fare as well by insisting on staying local.
Chris, good for you. I am 43 yrs old and an Air Force officer myself. Our net was $1.5m as of last November–discluding our primary residence and cars (which we own, too). Everything the financial samurai said is so true. I especially liked his comments/reflections about our own lifespan limitations and how we can excel with boundless energy in our 20s and 30s but our bodies do slow down after that. Over a million in net in the military is very do-able, you just cant go out and buy a $50,000 corvette as an E4 like I see happen across all branches and bases. How did we get to over a million? Stocks (and taking profits when they happen!), rental real estate (we have 5 rentals), max 401k’s with employer match (my wife), peer to peer lending, municipal bonds, and for goodness sakes, contribute at least half of all raises and bonuses to your own retirement. We like to use the phrase “bring your own raise” meaning create a monthly raise by investing in dividend stocks that pay reliable, steady dividends every month. Every time I put $1000 into an investment vehicle at 5% yield, I know it will give me a $4.16 raise per month. I have repeated that formula 100’s of times over, probably 1000’s. When I leave the military in 23 months, we will have enough passive income to not have to ever go to work again. Good luck!
Great post and thanks for taking the time to outline your own path.
I have a few counterpoints:
1. Yes, return on rent itself is technically zero, unless you can sub rent or something, but if you’re moving and have to rent for a job, then renting suddenly has a part in your income, generating a return.
2. Being 20-30 is arguably the greatest time to be alive. I agree from a financial point of view, it doesn’t make sense to splurge on things when the money could be working for you instead. However, it doesn’t make sense to live life in this age group and not have some luxuries since you are going to enjoy them more now than when you hit 40 and 50. It’s about balance.
3. Working more and harder doesn’t always equate to higher pay. Being smarter and doing things more efficiently have more of a bearing to advancing one’s paycheck in my opinion. Just an opinion though.
The $78,000 G500 was my splurge at 25. Had fun for a year, and came to my senses thanks to it not fitting in my condo.
Everybody is welcome to go nuts in their 20s. Just be cognizant it might be at the expense of more work or a smaller nest egg later on.
I have met many people who work hard and have never gotten “rich”.
However I have never met anyone I would consider rich or successful who didn’t work hard.
Counterpoint: Donald Trump?, but I agree with you in general :)
Great post! It’s very important to start young if we really want to hit our first million before or during our 30s.
It’s really the only way Robert. But on the flip side, if we don’t start the savings, investing, and risk taking process young, all those things we do end up spending money on should bring us some joy and good memories. Just have to work longer.
The great unknown will be when we die. Hence, getting our financials in order sooner is a good hedge against an early demise!
Thank you so much.After reading your post,to be honest, I was shocked by how amazing you are. And I am a freshman, I do think I learn a lot from your post. I think my life will change because of you.
I too am a freshman. I have a desire to do well in life. The rest of my family is very well off, and so I have a lot of additional pressure to do well in life. Although, despite carrying this weight on my shoulders I am going to work my ass off in life and put my heart and sole in my future. After reading this article, I can say that I have adopted an increasingly progressive mentality. Good luck to all.