knoxtom said:
This thread seems to have devolved into "look how much I have" rather than the original thread, which was more of a "how do I get there".
There used to be two paths to wealth, now there are three. I do not consider anyone who reaches any number based on 401k, retirement, and a good job to have wealth... they have security. A million dollar net worth isn't wealth and hasn't been for 25 years, it is security, and with modern numbers a million probably isn't even that. That doctor who just posted he has $20 million... that isn't wealth that is security because it provides his current standard of living for 30 years. He is used to living on a million a year, he has security to maintain that.
The three paths to wealth are:
inheritance - if you are inheriting wealth you wouldn't have started this thread, you hit the genetic lottery
lucky investing - Some people have made $30MM this past year off pepe coins. That isn't any skill at all, that is pure luck
having others work for you - this is the only one that you can actually do
So really the only way to achieve real wealth is by having employees or something working for you. No achievable job pays enough to truly be wealthy except some sort of business owner who has others working for them.
So what is the path to actual wealth?
Invest in yourself EARLY. It is way more important to get your own credentials early than to put it into the 401k. I love compound interest, but I truly love compound income. Turn paper you into a monster.
Hitch your horse to a golden child and become the golden grandchild. If you boss isn't moving up, neither are you. You either grow or you waste time.
Be married. Single people aren't taken seriously in corporate America.
Don't be frugal on your house purchase. Homes ALWAYS go up in value, do you want appreciation on 300k or on a million?
Don't buy a cheap car and don't trade cars. You want a 150k Raptor R? Get it. Just don't trade it for the next ten years. Depreciation doesn't kill you on cars, trading every year or two does. Reward yourself with what you want and hold it for a while. Every time you trade you are giving them 10k.
Be ready to quit when clients start telling you they want you and not the whole show. When you have a client base, it is time to go out on your own.
Don't be afraid to hire and don't be afraid to fire people.
You have to gamble on some investments. I keep about 50% in VOO. But I also keep a bunch in Soundhound, Hood, bitcoin, etc. VOO is great, conservative, blah blah blah. but you gotta have some big winners as well. You aren't getting wealthy off VOO (singles bring security), you are getting wealthy off the home runs (chicks dig the long ball). If you didn't make 50% on your stock account in 2024 then WTF are you doing? Winners are so dang obvious right now.
Last thing... there is some UT guy who interviews rich guys on youtube about how they got wealthy. At least half say they have been broke or some of their ventures went bankrupt. Gotta have some balls to build real wealth. How many businesses has Trump bankrupted? He got back on the horse. Banks and financiers don't care if something you did failed. I would argue that it is actually good to have some failure because it shows you are going to get back up. Don't be scared, just do it better.
I have so many issues with this post that I can't possibly take the time to refute each point.
Instead, I will add some food for thought, for purposes of this thread topic:
1. It seems that the idea behind the thread is to get advice from those who have accumulated a net worth over $1 million, including some steps they individually took to get there. Mostly, other than the "my net worth is higher than yours" or the "my way is the only way to build wealth" posts, there has been a lot of good information shared related to the initial concept.
2. My
definition of wealth, FOR THIS PURPOSE, is "extra assets not needed to support living needs for the remainder of my lifetime". Therefore, I define it as discretionary net worth that can be used for inheritance, charitable giving, splurges (private plane, vacation homes, extra vacation property, etc.) or any other purpose with no real "need" to support your later years or retirement lifestyle. Obviously, there are many paths to accumulate discretionary wealth, including entrepreneurial business ownership, corporate careers, frugal-living lifestyles, being a trust-fund-baby, and others. None are better or worse than others - it all depends on your unique circumstances.
3. I personally prefer a
liquidation-type valuation method for net worth and for retirement income. For instance, a personal home is clearly part of your net worth, but should be valued net of expected commissions, transaction fees, carrying costs and dual living expenses incurred during a sale period, capital gains taxes, house fix up expenses, etc. Therefore, your million dollar house with a half million mortgage (that you bought 20 years ago for $200k) might be truly valued not at $500k, but maybe closer to $250-350,000. Likewise, investment real estate, limited partnerships, and other non-liquid investments also carry a haircut for exit expenses and fees. Vacation homes, planes, boats, artwork, and others clearly belong in this category as well. Just don't fool yourself on the "gross value", use the net, for planning purposes.
4.
Retirement Assets. Depending on your tax situation, you'll likely want to view the value of tax-advantaged accounts like IRAs, 401(k), some RSUs, deferred comp plans, etc. using a similar "net" valuation. A million dollar pre-tax IRA in which withdrawals are likely to be taxed at, say, 20%, is more fairly valued at $800k (even if you plan to spread it out over many years.
Just providing some ideas for consideration on your own journey to a million and beyond. Buena Suerte!
