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Redditors who are rich (net worth $1 million+) - how did you get rich?

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Re: Redditors who are rich (net worth $1 million+) - how did you get rich?

#21
post #9

Easiest way: No kids. Two good incomes. Reliably saving 20%. Mid 40s. No college debt or health issues. That should get you to about a million in assets.

kids are an investment...they are your safety net...worse comes to worst, you can rely on them to support you in your late days if things go terribly wrong.

its a good way to avoid ending up on the street...you'll always be able to get room and board with your kids.

Since our generation won't get any social security or pensions to live off, we are going to need all the help we can get if things go south.

Re: Redditors who are rich (net worth $1 million+) - how did you get rich?

#22
Our path to be on track for a net worth of $1 mil:

1) Two good incomes on the professional track. We both have good degrees from universities and don't plan on taking any breaks in employment. Even with kids, there are plenty of great childcare options available. Living near family helps too.

2) Drive paid off cars. Buy new cars if you want, but structure your costs so you can pay them off in 2-3 years max and then drive them for another 5 or more. Stagger your purchases so you never have more than one car payment at a time.

3) Buy a home well below your means in area with a lower cost of living. There are plenty of parts of the country where you can earn a combined six figure income while spending less than $100/sqft for a home in a good neighborhood.

4) Limit how often you eat out for lunches and dinners to twice a week or less.

5) Live frugally so that you can save 20-40% of your income. Don't cheapen out on things for you or your family, but don't let yourself be manipulated by the consumerism that surrounds us. If you have a disposable income, use it for experiences like travel rather than collecting stuff.

6) Avoid expensive hobbies/activities that consume a lot of time and don't contribute much to your marketable skills. If a hobby requires spending a considerable chunk of your monthly income, reconsider whether it's really worth it.

TL;DR: It's really not that hard to save your way to $1 mil, you just have to be willing to work a little harder and spend a little less than most people to get there.

Re: Redditors who are rich (net worth $1 million+) - how did you get rich?

#23

WRT the top post there (as of right now), you have to be pretty lucky if driving a 20+ year old car is a net gain. Especially if you weren't the owner of that car for the majority of its life. Like with old codebases, there's a lot that can go wrong at any moment and be so difficult and expensive to maintain that it's worth it to just throw it out and get a certified pre-owned. Depends on the car, I guess, I ditched…

> you have to be pretty lucky if driving a 20+ year old car is a net gain.

I can't imagine a 20+yr old car which is a gain, and I'm a fan of classics and owner of an '84 BMW. In terms of money eating vintage cars are worse than gold-diggers unless you let them rot. One must be overentusiastic by their hobby not to see that's a sinkhole, been there done that ;)

Re: Redditors who are rich (net worth $1 million+) - how did you get rich?

#24

Our path to be on track for a net worth of $1 mil: 1) Two good incomes on the professional track. We both have good degrees from universities and don't plan on taking any breaks in employment. Even with kids, there are plenty of great childcare options available. Living near family helps too. 2) Drive paid off cars. Buy new cars if you want, but structure your costs so you can pay them off in 2-3 years max and then d…

I have to say I almost wondered if this plan was meant as a bit of a joke.

I'd rather spread my income around now on a nice(r) house, some fun hobbies and a bit of abject consumerism, and enjoy life more evenly then save now not have as much fun but end up with more money in the bank later. You'll never get your younger years back.

Re: Redditors who are rich (net worth $1 million+) - how did you get rich?

#25

Our path to be on track for a net worth of $1 mil: 1) Two good incomes on the professional track. We both have good degrees from universities and don't plan on taking any breaks in employment. Even with kids, there are plenty of great childcare options available. Living near family helps too. 2) Drive paid off cars. Buy new cars if you want, but structure your costs so you can pay them off in 2-3 years max and then d…

I have to say I almost wondered if this plan was meant as a bit of a joke. I'd rather spread my income around now on a nice(r) house, some fun hobbies and a bit of abject consumerism, and enjoy life more evenly then save now not have as much fun but end up with more money in the bank later. You'll never get your younger years back.

There lies the difference between Eastern(H. Karthik) and Western(Mike Ryan)approach to personal finances.

Re: Redditors who are rich (net worth $1 million+) - how did you get rich?

#26

Our path to be on track for a net worth of $1 mil: 1) Two good incomes on the professional track. We both have good degrees from universities and don't plan on taking any breaks in employment. Even with kids, there are plenty of great childcare options available. Living near family helps too. 2) Drive paid off cars. Buy new cars if you want, but structure your costs so you can pay them off in 2-3 years max and then d…

I have to say I almost wondered if this plan was meant as a bit of a joke. I'd rather spread my income around now on a nice(r) house, some fun hobbies and a bit of abject consumerism, and enjoy life more evenly then save now not have as much fun but end up with more money in the bank later. You'll never get your younger years back.

Yes but a new iPad doesn't make you younger either.

Re: Redditors who are rich (net worth $1 million+) - how did you get rich?

#27
There's a sad undercurrent to this, as some redditors respond that they find this depressing. While I understand their plight, I do not understand the sustained pessimism for most of the depressed ones.

I went to work right out of high school at menial jobs. No college, no big family business. Paycheck-to-paycheck, and any minor emergency like a dead car battery was a financial crisis. I did not "get lucky" on stocks or anything. While getting rich has not been a focus for me, I decided I definitely did NOT like being poor. Lots of small steps, and staying on the lookout for ways to improve matters has led me to not be poor. I'm not rich but I'm in decent shape and moving in the right direction: no debt except the mortage, which will be payed off soonish; some money in savings, stocks, 401k, etc. I'm living at a decent level and should be able to retire in some comfort. No magic. No big windfalls. This is doable by most of those depressed people.

Re: Redditors who are rich (net worth $1 million+) - how did you get rich?

#28
post #25

Earlier quoted context omitted.

I have to say I almost wondered if this plan was meant as a bit of a joke. I'd rather spread my income around now on a nice(r) house, some fun hobbies and a bit of abject consumerism, and enjoy life more evenly then save now not have as much fun but end up with more money in the bank later. You'll never get your younger years back.

There lies the difference between Eastern(H. Karthik) and Western(Mike Ryan)approach to personal finances.

It would probably be easier for the Mikes of the world to be happy not spending that extra 20% on consumer goods if our peers and role models weren't all doing the same thing. Good reason to be a Karthik, I guess.

Re: Redditors who are rich (net worth $1 million+) - how did you get rich?

#29
post #20
post #9

Easiest way: No kids. Two good incomes. Reliably saving 20%. Mid 40s. No college debt or health issues. That should get you to about a million in assets.

I fulfill all the above (except that I have a son, but he's young so the only big cost is daycare, around 13K/year), so where's my million!? In order to develop a successful model, one should also have negative examples, i.e. people who could have had ~$1M in their mid 40s but do not. The greatest mistakes I made that I see with hindsight are (i) doing a PhD in EE where a MS was more than enough and then taking too l…

Yes, I mistakenly left out "start working at 21" when I referenced the ages. Because even if you have a net-worth-neutral graduate education, you are not saving and investing money during those years.

Re: Redditors who are rich (net worth $1 million+) - how did you get rich?

#30

Our path to be on track for a net worth of $1 mil: 1) Two good incomes on the professional track. We both have good degrees from universities and don't plan on taking any breaks in employment. Even with kids, there are plenty of great childcare options available. Living near family helps too. 2) Drive paid off cars. Buy new cars if you want, but structure your costs so you can pay them off in 2-3 years max and then d…

I have to say I almost wondered if this plan was meant as a bit of a joke. I'd rather spread my income around now on a nice(r) house, some fun hobbies and a bit of abject consumerism, and enjoy life more evenly then save now not have as much fun but end up with more money in the bank later. You'll never get your younger years back.

>You'll never get your younger years back.

While I do agree to an extent, a very wealthy uncle of mine has always told me "the hallmark of maturity is the ability to delay immediate gratification."

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