GE said:

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ea1060 said:

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LMCane said:

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I think it would be helpful if this thread got back to how to amass net worth of a million dollars.

which 401K mutual funds?

which private brokerage stocks?

which ETF?

how much crypto?

which real estate to buy?

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Its simple. Make a high income. Save most of that income. Invest your savings into a low cost index fund like VTSAX. You should have a million net worth in 7-10 years if you follow this.

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That first part about the high income isn't that simple.

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MS08 said:

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whoop1995 said:

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gigemhilo said:

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Many who you would think are millionaires are in fact NOT millionaires - because they spend every dime they make and have an insane amount of debt.

I read somewhere once that the most common vehicle owned by a millionaire was a Ford F150. This was because there are more farmers that are by definition millionaires than there are big shots. There is a lot of truth to that around these parts. Had a client pass away a couple years back that lived in a worthless shack but had almost $2mil in savings bonds in the bank. Crazy!

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My father in law and I would go into town and he would run into some of his friends or people known to him and after he was done we would get in the truck and he would say "all hat no cattle" after a few of them. I looked at him with a blank stare. He went on to explain that it is better to have cattle/money than "all hat"/appearance as most all hats are broke and you could tell it in their language, mannerisms, dress and playthings.

I decided to be a cattle guy.

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Wow, responded to a comment from 2013! In the words of Ron Burgundy, "I'm not mad, I'm impressed."

Gramps was a cattle man in East Texas by Lake Tyler. He started that at 68 years of age, almost made the poor Midwest farmer a millionaire before he went. One of the sayings he told us before he passed was that, in his earlier years, "I should have risked more."

Cheers,

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jamey said:

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House appreciation has probably made a lot of people millionaires on paper anyway over the last few years.

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Cyp0111 said:

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Maybe, where are people moving right now to realize that value ?

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YouBet said:

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jamey said:

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House appreciation has probably made a lot of people millionaires on paper anyway over the last few years.

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It's one of the reasons why the number of early retirements is up over historical trends.

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Aggie71013 said:

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How did you go from $125k to $3.1 million in brokerage in 3 years?

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Sock for BI board said:

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Sock for BI board said:

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TDLR: I'm about to turn 40 and my net worth is around $2.5 million

Roth IRA: $500k
Brokerage: $125k
Private investments into friends' ventures: $75k (one real estate, one start up, one Private Equity)
Equity in House: $200k (value less debt)
Value of business I'm selling in 2019: $900k (according to boutique ibanker in the space who is selling)
Value of business I'm keeping: $600k

• Income * Age / 10 says I should be at $2 million. I was behind this rule for almost my entire career except for the last few years.

I feel I will have reached FIRE at $3.5 million liquid with house paid off. Kids are 5 and 8 so I figure I have at least 10 years of work left. I'd like to be done at 50 and that seems very doable. The biggest concern (like all) is health insurance from 50 to 65. I debate if I want to risk off and sell all the businesses and coast in corporate for the next 10 years or if I want to risk on and start another business. We'll see.

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I made a long post back on page 22 (1/6/19). I thought it was time to update it. A small portion of it is quoted above.

TLDR: Now 43 and my net worth is around $5.2 million. Roughly doubled since age 40.

Roth IRA: $536k (made some bad investment moves and missed a lot of gains the last few years.)
Brokerage: $3.1 million
Private investments into friends' ventures: $300k (one real estate, two start up, two Private Equity)
Equity in House: $400k (value less debt)
Value of business I sold in 2019: $750k (Thought it was going to be more like $900k)
Value of business I still have: $1 million
Only personal debt is 8 years left on a 15 year mortgage at 2.25% (business uses a line of credit)

• Income * Age / 10 says I should be at $2.6 million. I was behind this rule for almost my entire career until about age 37-38.

The primary purpose of my post is to update my thoughts on FIRE. When I wrote my original post back in 2018, I really believed I could FIRE at $3.5 million liquid with a paid off house. My views have changed considerably. However, it is good to have goals because I've essentially reached my FIRE goal I set at age 40 much faster than I thought I would (partially just due to having the goal.)

I could sell my business and be sitting at around $4.5 million in investments with a paid off house. I'm very confident I can be done around age 50 with $5-6 million. However, I feel to be done today at age 43, I need something more like $7.5 million. At 43, I have a lot of expenses I want to cover for my kids over the next 7-10 years (and hopefully a lot of years left to live). Thanks for reading. Just wanted to share.

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Quote:

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Its simple. Make a high income. Save most of that income. Invest your savings into a low cost index fund like VTSAX. You should have a million net worth in 7-10 years if you follow this.

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fka ftc said:

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You have done very well and congrats are deserved. Couple of questions on the math above. Not intended as criticism, just clarification.

How are you valuing private investments? I would not count anything above either original investment or you current interest in earnings / losses booked to date - and reasonably expectation that any debts paid and receivables collected if you / they had to liquidate the business in less than 90 days.

For the business sold, where are the proceeds from that in your other calculations? Assume either in Brokerage or invested in private investments. Seems like it is double counted but maybe I am missing something.

Depending on the nature of your business, business credit lines are typically accompanied by personal guaranties and should be factored into your net worth.

I am 44 and aiming to be over $10MM before I declare FIRE. Even then I plan to keep a couple businesses running with the idea to not hit the nest egg for everyday living expenses.

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Spurswin5 said:

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ABATTBQ11 said:

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I lost my maternal grandfather a couple years after getting married. I'm really glad he got to be there in retrospect, and I think ours was the only wedding he got to be at out of 12 grandchildren. My last grandparent is my maternal grandmother, and it makes me really happy that she's gotten to meet our kids and my nephew. My cousin is due with the fourth great grandchild in a couple months. My wife's maternal grandparents are still around. Counting our two, they've got four great grandchildren as well. I'm really happy our oldest is able to get to know all of her great grandparents and is at an age she might remember them.

And yes, at some point family becomes the most important thing. My grandmother and my wife's grandparents have retired comfortably and aren't exactly wanting for much. The most important things to them are seeing their kids and grandkids and great grandkids. At that age, stuff is mostly just stuff, and the really important things are relationships and the time you get to spend worth people you love. I think that should be as much a part of retirement planning as financials.

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100% agree
I retired at 57
About to be 59

I'm glad my Aggie wife and I had kids in our early 30's since my dad Class of '60 was struck down with cancer at 72 and lived a perfectly healthy life

My brother died in a car wreck and my mom is near the end in Hospice

I treasure the memories of all of us together with their "precious" grandkids.

I was 33 and 36 when our two boys were born
I am lucky to be very fit and in good health so it was great to throw baseballs with him while he was in High School (I stopped once he went D1 as a pitcher ball travels too fast lol).

But I had friends who were out of shape and I threw balls with their kids because they were too old to play with them

The problem now is what If our kids wait until they are mid-30's to have kids (assuming that they get married and choose to have them)? We will be late 60's-early 70's by then. But I can't control that end of the equation.

Life is a balance just like the portfolios we are talking about. Enjoy it.

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ToddyHill said:

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Quote:

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Its simple. Make a high income. Save most of that income. Invest your savings into a low cost index fund like VTSAX. You should have a million net worth in 7-10 years if you follow this.

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I would say that if one doesn't have a high income they should educate themselves and buy a few technology stocks (I'm of the strong opinion that an educated individual can make better returns than those that manage mutual funds). Don't trade...invest. I did that...and I did it with less than a year's salary. It took a little bit of time (15 years), but I guess I would say I'm in a category that will provide a very comfortable retirement.

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Rustys-Beef-o-Reeno said:

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Still reported on net worth no?
They have the option to sell and rent if they would like.

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LostInLA07 said:

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I generally agree but recent empty nesters and retirees might have an opportunity to downsize and end up with a lot more cash than they would have had a year or two ago. It's situational but wealth created from housing appreciation should factor in. Relos from California are an example playing out in front of us. They are essentially upgrading their housing while still walking away with a bunch of cash they can invest elsewhere by moving to a cheaper market.

Obviously there's no real benefit if you're in a "starter home" or something you can't downsize from and you're already in a market that is "cheaper" or can't relocate to a lower cost location for retirement.

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LMCane said:

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jamey said:

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House appreciation has probably made a lot of people millionaires on paper anyway over the last few years.

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unless they own the house outright- if they sell the property they have to move to just as expensive other property.

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