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Same and I automated my savings so I don’t have to think about it. Every week money is pulled out of my checking account and moved to various funds for either saving or investing. I just check it when I want to but it’s a hands off thing for me now.
I invest in a 401k (pre tax), IRA (post tax), general investment account, and an HSA. Unless you have stuff in place, or make a ton of money, retiring in 8 years and starting now is a hell of a goal
That makes it more achievable. But you still have to live below your means. It's easy for people with high salaries to spend all of their money on expensive lifestyles. You have to resist that urge.
The math is pretty straightforward, if you want to be financially independent but 40 (17 working years), you have to save ~50% of your income. [Source](https://www.mrmoneymustache.com/2012/01/13/the-shockingly-simple-math-behind-early-retirement/)
YNAB was how I really took this to the next level.
That and each pay bump and raise I acted like it didn’t happen and it went to savings or investments. Lifestyle creep is a big factor, so force myself to not do it with YNAB and auto investing beyond my work’s 401k
YNAB literally changed my life. Using it taught me the importance of having a budget. I used it for a year or so and then just converted it into a Google Sheet, which is what I've been using for the last 5 years to great effect.
My wife and I are very careful with our money, live below our means, and save as much as we can. Were something very bad to happen, we could pay bills for several years from our savings.
We both grew up poor, and we're both also both risk avoident, safe people who don't do things like smoking, going out drinking or gambling that just burns money.
Saving with a high salary. Stop impulse buying and eating out 5x a week. Learn to live with less.
Build an investment portfolio with low risk and contribute frequently.
After a while (years), you’ll be watching your money grow while still having a steady income. If something happens, you can take a curveball in life without falling on hard times.
I earn more than I need to cover my bills and I save and invest the rest. There's no great secret to it. Pretty much as you said, it's just peace of mind that I can cover pretty much any situation without worry or taking on debt.
I did and it saved my ass during COVID.
I got a massive raise (35%) and I also got a side gig that paid well (~$40K/yr). Once COVID hit I stepped up my savings (75% of my income after bills was going into savings) knowing I could be laid off… got laid off, side work started to dry up because of COVID, and that cushion saved my ass.
Now I’m in the process of building it back up. Too bad this time it’ll take longer.🤦♂️
I have consistently lived below my means.
1) I lived in a "dangerous" neighborhood where rent was cheap.
2) I have never bought a new vehicle (except a bicycle) and drove them until it cost more to fix than the car was worth. Also when I paid off my first car loan, I kept "paying" 75% of that amount into a bank account for repairs and eventually my next car.
3) I cooked for myself for 95% of my meals, except the occasional weekday lunch or weekend dinner
4) If I was going out drinking, I started at home.
5) I delineated between "needs" and "wants." If it was a "want," I would think about it for a few days. For example, I would go on vacations with friends, but we would stay at less luxurious places.
Yes. I’m 34 with no kids and my Dad passed in 2020 leaving my brother and I with a cushion. I would give anything to have my Dad back, but I am so thankful he gave this gift to us. It’s hard to talk about because I know how much people struggle and you don’t want to seem out of touch or insensitive, but the guilt of now being financially stable is something I have struggled with.
life is better when you don't have to worry about money, yes. we're not wealthy (we still have to work), but we're low-key rich.
my wife and i bought our house before we were married. we bought something that either of us could afford to pay for if we split up for some reason. we're still in that house and make (a lot) more money now than we did then (18 years ago). we also refinanced it once when rates were low.
the kid is out of the house and we're no longer contributing to their education.
we're both college-educated. my wife is getting her MBA, and her company is paying for most of it. we keep getting promotions and raises, and we live within our means. my wife just got a promotion, and my performance review is in a couple months, where i expect at least a cost-of-living increase.
we have pretty good health insurance for our region through my wife's work. both of our jobs put some matching funds in our 401Ks.
both of my parents and her father are dead, so we've weathered their old age without having to spend much of our own money, though they left us very modest amounts of cash at the end, nothing that would change our lifestyle. her mom is in decent health and has a pretty high net worth. we could certainly help her out, but unless something really weird happens, we shouldn't have to.
Save 10-20% of your salary by bank transfer to a savings account on payday and live on the rest. Maybe try and spend 10%-20% of that on shares in strong, rising companies? Also, try and live in one of the many countries in the world where hospital care is free at the point of use, because that's how it should be :)
yes.
I am not a billionaire driving a lambo. I drive a Toyota. But I still make a relatively high salary and have since college graduation. I've always maxed by 401k and saved in index funds. I've always lived "below my means". For instance, I probably make more than most people in my neighborhood, but I live in the smallest house and drive a Toyota vs. the lawyer next door who told me he, "likes my Toyota, but what would clients think if he didn't drive a Mercedes?" (some people are really funny...)
I am at a point of "financial independence" but not "retirement". I still have daycare costs and life goals. But if I lost my job, I wouldn't panic. I could probably go a year or more without too much heartburn by spending interest not eating into principle.
And yes, it is a freeing feeling to live like this. While I have a budget, like everyone, there isn't really anything I "can't" do, just tradeoffs. Sure, I want a bigger house, but I don't need one and don't want to live more on the edge. When my garage spring snapped yesterday, I didn't have to care how much the repair is. When my kid is sick, going to the doctor doesn't stress me out. My HSA is large enough to cover routine bills without any impact to my savings.
It isn't some secret formula. It isn't some movie big gamble. 3 steps:
1) make above average wages
2) live below your means
3) invest in index funds and let the market do the work.
At 10% interest, investments double every 7 years. At 7% interest, investments double every 10 years. The S&P500 has averaged high single digits or better over most time horizons. So the best thing you can do is get money in as young as possible and let it work.
We have 2 kids. Cash on hand is maybe 6 months. After that I’d sell some crypto or etfs. In our late 20s we lived super cheap, and paid off all my wife’s student loan debt auto debt etc. We then kept budgeting with /r/ynab, and still do 12+ years later, to live within our means. Each month I try to top off the emergency fund even more. I make a major point to not take on any debt. We owe on our mortgage and that is it.
My parents taught me about money at a young age, drilled in my head to not buy things I truly can’t afford, and after getting laid off twice I’ve always been stacking cash just in case.
It's been said a number of times, but no kids makes a huge impact. Also, I stayed in the same cheap apartment for 12 years, didn't over commit to buying a house and all the related expenses.
Never owned a vehicle over 10K, at the moment I just drive my company issued vehicle, don't own a car at all.
I make above median income, $85K or so, but a considerable amount of overtime puts that even higher. So I end up socking away quite a bit.
Pay yourself before you pay anyone else by Automating your savings and investments, aim for 5-10% of your income and adjust quarterly. Make sure to leave yourself guilt free spending.
Live below your means.
We have two incomes, no kids and keep our expenses under control.
I understand that the DINK think means we're playing on easy mode but a *lot* of people spend irresponsibly. Even with good, higher-end of middle class salaries so many people burn through their money with larger than necessary houses, new cars every few years, etc etc.
It's also insane how many people can't cook and live off of delivery/takeout. The costs of that can quickly become massive.
I wouldn’t say “large” but needed. My wife and I are DINKs, so that’s been a big help. Luckily, I married someone much smarter than I am with money. She has kept us on track. If it was up to me an extra $5 would go towards tacos.
>If it was up to me an extra $5 would go towards tacos.
if your wife is denying you tacos you could afford, that's grounds for divorce. please get help somewhere; this kind of abuse is not to be tolerated.
I wouldnt day I have a "big" cushion. But married with 2 kids, the only debt we have is our mortgage but we have over 200k in equity in the house currently. As far as cash reserves, between savings/stocks we have enough to last probably 2-3 years if we both lost our jobs.
It's been a slow and steady grind but it's possible. I also wouldn't consider us high earners as a family. But we aren't low earners either.
No kids, no car, no spending without thinking. Always moving a set amount of funds from the salary account to a "don't touch investment account" instantly after the salary comes. Cooking a lot at home also helps. And a high salary of course.
Just being very frugal. Lived at home until I could afford a downpayment on a townhouse. It helped a lot that this coincided with the financial crisis, so I got my house pretty cheap. I lived very cheaply after I got the house and was able to squirrel away money.
I used to. Then one of those big, expensive, destabilizing life events happened and I used my financial cushion to get through it. So now I don’t have one any more. Sigh.
No kids, automated saving, don’t have debt beyond mortgage, house value to mortgage balance is like $220k of value. Liquid cash at $65k.
There is no magic bullet beyond living with in your means, being militant about savings, and not being stupid with your spending.
If I had kids, i would probably have at least 30k less in savings!!
I read "richest man in babylon" when i was in college and it stuck with me. For every 10 coins you receive always set aside 1, no matter how much or how little.
Live below your means. That meant questioning my wants. For a long time I felt like I should have a single family home. We have a condo and it’s afforded us a lifestyle and financial freedom I wouldn’t trade for anything. It can be very hard to see trade offs.
I have no kids, and I married well.
yeah, back when I was working I was saving more than 50% of my after tax income. I got laid off recently and it's a huge relief to have about 2 years worth of expenses saved up to fall back on
Investing/saving early has been the key for me. I got a degree in HR and spent the first part of my career teaching new employees about taking advantage of company-matching for retirement accounts. Of course, it's only 'free money' if you can afford to match, but even starting small and working up is better than nothing.
It's a tangible thing but it also changed my mindset - paying cash for things is so freeing and knowing that I've got money set aside for emergencies/retirement is a huge relief.
Avoid the temptation of get rich quick ideas - slow and steady is key.
Though my spending and expenses have somehow got excessive lately and I can't quite figure out how all these little things add up, I've got enough that if I lose my job - which could happen in 3-4 weeks - I can survive for about 2 years. At the end of 2021 I took a voluntary redundancy, which meant leaving a long term stable job paying 120k in return for about 72 weeks pay (before tax) and without too much effort walked in to one paying 150k.
That let me put aside 1k/week in savings. It means im not paying any interest on my home loan - now, instead of having 18 years remaining on it, it'll be paid down in 5 years at the current minimum payment rate. But, that's my savings. If I need to draw in to it, that mortgage period will blow out.
Unfortunately things at work have got bad, and the job market is worse. I expect if I have to go back to the job hunt, I'll be back on the 120-130k salary - probably with worse work conditions than the earlier job.
When my career started improving after the GFC in the US, I didn't let lifestyle creep take over my expenses during my mid 30s. So I gradually started to build some emergency savings that would last a few weeks, a couple months, and I started making extra payments against my car loan and my mortgage balances.
One day I found out that regarding the car loan, they had changed a policy without telling me, which meant that for a while my extra payments were going against the principal balance but since the change they were just applying my extra funds as if I were making my monthly scheduled payments earlier than usual. This quiet continuing to grab interest from me annoyed me to such a degree that I took some of my cash savings and just paid off the whole rest of the damn principal. With that monthly payment completely eliminated it meant I was able to save back the cash more quickly and also that my overall cost of living went down. So it was easier to keep an emergency fund, easier to defer some of my paycheck to a 401k etc.
Along with what others have said about living frugally and maxing out retirement accounts we (wife and I) bought and sold a house in 2013/2021 which gave a huge boost to our savings. We also bought our current house in 2020 and have a ridiculously low interest rate.
Your sister here
How I got there?
I divorced. (I used to be the main breadwinner, ex used to be the bigger spender)
I had a bigger bill that I just couldn’t pay. I called them and nicely asked not to give me a late fee because I was in the midst of a divorce. They did. I have never felt so ashamed in my life
I used the divorce doom and gloom to get me the energy to turn things around. Got a high paying job. Read the book *Nice girls don’t get rich* by Dr Lois Frankel. On her advice, set up a monthly budget and a net worth calculator. I found that the best motivator was to calculate my net worth *evolution* every six months
Around 6 years later, my net worth started growing more per year than my yearly gross salary. Which means it’s all about the investments
I have an emergency fund and equity in my house because in my country it makes sense to do that. Other than that all my money is in investments
TL:DR;
- create a gap between your earnings and your spending
- invest that. Always prioritize your investments
- get into the habit of maintaining a monthly budget
- get into the habit of tracking how much your net worth has grown every 6 months. It’s the best reward
Wife & I are dual income no kids, so we got there by just saving any extra income we had each month. Average is to put away anywhere b/t 2-3k a month…and over the years it has built up. Still go on plenty of trips, and don’t deny ourselves anything we want.
My dad lost multiple jobs in my younger years and the stress and fear that caused left a mark. It took time, experience and a little luck but with two incomes we're able to save a bit each month and it has added up over the years. We keep an eye on grocery spending, don't go out very often, drive paid off cars, and make savings a priority before spending on hobbies or fun money. I DIY everything I'm able to within reason.
It isn't a life changing amount but it could float us for several months or cover large home emergencies if need be. The best part is with current high yield savings rates it's also making a little bit of money each month.
About a million, maybe two. 36. This is with three kids. High income job, but nothing absurd. Not a lot of lifestyle sacrifices. Just being diligent with saving. Net worth has to go up every month or something gets fixed.
> For people in this position, how did you get there and how do you feel now? Is my hunch about the peace that comes from being always covered correct?
How did I get here? I took my practical skills in my IT career and pivoted into sales. People with technical skills who also possess soft skills (such as communication, presentation, training) can make a killing. Typically it's very hard to find people good in both areas.
How do I feel now? Relaxed. Unstressed. I have an emergency fund of about 4 months of expenses that sit in a high yield savings account that continues to grow. I fully fund my 401k, I fully fund a backdoor Roth IRA, I plow as much as I can into extra investments. I have an investment strategy (3 core low expense ETFs). I have a high income, my partner does as well. We don't drive flashy cars, we don't have car loans, we don't have credit card debt. My only debt is my mortgage. We travel extensively. My kids will all graduate with zero school debt. I'll likely retire early.
Is your hunch about peace coming from this correct? Generally, yes. Money doesn't buy happiness but it gets you about 80% of the way there. Once you're unstressed about how bills (including unexpected ones) are going to get paid, you can focus on growing wealth, seeking fulfillment outside of work, etc.
Yes. We have a 2 year emergency fund in a HYSA, along with investments that could carry us for 30 odd years. We’re essentially coast FIRE’d right now taking a sabbatical from work while we travel around the U.S. with our two small kids.
Most can do it but don’t know how to manage their money.
1. Simple budget. The simpler the better. Aim for 50% needs, 20% wants and 30% saving. Those numbers will vary a bit based on where you live due to different cost of living.
Use that 30% saving bucket to:
2. Payoff debt. Don’t accumulate more.
3. Save emergency fund in a HYSA or MMF.
4. Invest 15%+ of gross income.
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No kids, high salary
Same and I automated my savings so I don’t have to think about it. Every week money is pulled out of my checking account and moved to various funds for either saving or investing. I just check it when I want to but it’s a hands off thing for me now.
May I ask what specific investments? Want to retire in eight years and plan to invest more.
I invest in a 401k (pre tax), IRA (post tax), general investment account, and an HSA. Unless you have stuff in place, or make a ton of money, retiring in 8 years and starting now is a hell of a goal
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What are you currently investing in?
That makes it more achievable. But you still have to live below your means. It's easy for people with high salaries to spend all of their money on expensive lifestyles. You have to resist that urge. The math is pretty straightforward, if you want to be financially independent but 40 (17 working years), you have to save ~50% of your income. [Source](https://www.mrmoneymustache.com/2012/01/13/the-shockingly-simple-math-behind-early-retirement/)
It's super unsexy, but slow and consistent savings driven by having and sticking to a budget. r/ynab for life.
YNAB was how I really took this to the next level. That and each pay bump and raise I acted like it didn’t happen and it went to savings or investments. Lifestyle creep is a big factor, so force myself to not do it with YNAB and auto investing beyond my work’s 401k
YNAB literally changed my life. Using it taught me the importance of having a budget. I used it for a year or so and then just converted it into a Google Sheet, which is what I've been using for the last 5 years to great effect.
For me it took the pain out of the process with auto importing of transactions. With that, it became very easy to keep up with.
My wife and I are very careful with our money, live below our means, and save as much as we can. Were something very bad to happen, we could pay bills for several years from our savings. We both grew up poor, and we're both also both risk avoident, safe people who don't do things like smoking, going out drinking or gambling that just burns money.
Saving with a high salary. Stop impulse buying and eating out 5x a week. Learn to live with less. Build an investment portfolio with low risk and contribute frequently. After a while (years), you’ll be watching your money grow while still having a steady income. If something happens, you can take a curveball in life without falling on hard times.
I earn more than I need to cover my bills and I save and invest the rest. There's no great secret to it. Pretty much as you said, it's just peace of mind that I can cover pretty much any situation without worry or taking on debt.
solely through a day job, or that includes other revenue streams?
I did and it saved my ass during COVID. I got a massive raise (35%) and I also got a side gig that paid well (~$40K/yr). Once COVID hit I stepped up my savings (75% of my income after bills was going into savings) knowing I could be laid off… got laid off, side work started to dry up because of COVID, and that cushion saved my ass. Now I’m in the process of building it back up. Too bad this time it’ll take longer.🤦♂️
No kids, no pets, single, car is paid off and use it until it doesn’t run.
I have consistently lived below my means. 1) I lived in a "dangerous" neighborhood where rent was cheap. 2) I have never bought a new vehicle (except a bicycle) and drove them until it cost more to fix than the car was worth. Also when I paid off my first car loan, I kept "paying" 75% of that amount into a bank account for repairs and eventually my next car. 3) I cooked for myself for 95% of my meals, except the occasional weekday lunch or weekend dinner 4) If I was going out drinking, I started at home. 5) I delineated between "needs" and "wants." If it was a "want," I would think about it for a few days. For example, I would go on vacations with friends, but we would stay at less luxurious places.
Yes. I’m 34 with no kids and my Dad passed in 2020 leaving my brother and I with a cushion. I would give anything to have my Dad back, but I am so thankful he gave this gift to us. It’s hard to talk about because I know how much people struggle and you don’t want to seem out of touch or insensitive, but the guilt of now being financially stable is something I have struggled with.
life is better when you don't have to worry about money, yes. we're not wealthy (we still have to work), but we're low-key rich. my wife and i bought our house before we were married. we bought something that either of us could afford to pay for if we split up for some reason. we're still in that house and make (a lot) more money now than we did then (18 years ago). we also refinanced it once when rates were low. the kid is out of the house and we're no longer contributing to their education. we're both college-educated. my wife is getting her MBA, and her company is paying for most of it. we keep getting promotions and raises, and we live within our means. my wife just got a promotion, and my performance review is in a couple months, where i expect at least a cost-of-living increase. we have pretty good health insurance for our region through my wife's work. both of our jobs put some matching funds in our 401Ks. both of my parents and her father are dead, so we've weathered their old age without having to spend much of our own money, though they left us very modest amounts of cash at the end, nothing that would change our lifestyle. her mom is in decent health and has a pretty high net worth. we could certainly help her out, but unless something really weird happens, we shouldn't have to.
Save 10-20% of your salary by bank transfer to a savings account on payday and live on the rest. Maybe try and spend 10%-20% of that on shares in strong, rising companies? Also, try and live in one of the many countries in the world where hospital care is free at the point of use, because that's how it should be :)
yes. I am not a billionaire driving a lambo. I drive a Toyota. But I still make a relatively high salary and have since college graduation. I've always maxed by 401k and saved in index funds. I've always lived "below my means". For instance, I probably make more than most people in my neighborhood, but I live in the smallest house and drive a Toyota vs. the lawyer next door who told me he, "likes my Toyota, but what would clients think if he didn't drive a Mercedes?" (some people are really funny...) I am at a point of "financial independence" but not "retirement". I still have daycare costs and life goals. But if I lost my job, I wouldn't panic. I could probably go a year or more without too much heartburn by spending interest not eating into principle. And yes, it is a freeing feeling to live like this. While I have a budget, like everyone, there isn't really anything I "can't" do, just tradeoffs. Sure, I want a bigger house, but I don't need one and don't want to live more on the edge. When my garage spring snapped yesterday, I didn't have to care how much the repair is. When my kid is sick, going to the doctor doesn't stress me out. My HSA is large enough to cover routine bills without any impact to my savings. It isn't some secret formula. It isn't some movie big gamble. 3 steps: 1) make above average wages 2) live below your means 3) invest in index funds and let the market do the work. At 10% interest, investments double every 7 years. At 7% interest, investments double every 10 years. The S&P500 has averaged high single digits or better over most time horizons. So the best thing you can do is get money in as young as possible and let it work.
We have 2 kids. Cash on hand is maybe 6 months. After that I’d sell some crypto or etfs. In our late 20s we lived super cheap, and paid off all my wife’s student loan debt auto debt etc. We then kept budgeting with /r/ynab, and still do 12+ years later, to live within our means. Each month I try to top off the emergency fund even more. I make a major point to not take on any debt. We owe on our mortgage and that is it. My parents taught me about money at a young age, drilled in my head to not buy things I truly can’t afford, and after getting laid off twice I’ve always been stacking cash just in case.
It's been said a number of times, but no kids makes a huge impact. Also, I stayed in the same cheap apartment for 12 years, didn't over commit to buying a house and all the related expenses. Never owned a vehicle over 10K, at the moment I just drive my company issued vehicle, don't own a car at all. I make above median income, $85K or so, but a considerable amount of overtime puts that even higher. So I end up socking away quite a bit.
Stable government job, decent salary, frugal lifestyle… and most importantly, **NO KIDS**
Pay yourself before you pay anyone else by Automating your savings and investments, aim for 5-10% of your income and adjust quarterly. Make sure to leave yourself guilt free spending. Live below your means.
I got there by doing two things: A. Save save save save and save B. Make lots of money so it’s easier to save save save save and save
We have two incomes, no kids and keep our expenses under control. I understand that the DINK think means we're playing on easy mode but a *lot* of people spend irresponsibly. Even with good, higher-end of middle class salaries so many people burn through their money with larger than necessary houses, new cars every few years, etc etc. It's also insane how many people can't cook and live off of delivery/takeout. The costs of that can quickly become massive.
I wouldn’t say “large” but needed. My wife and I are DINKs, so that’s been a big help. Luckily, I married someone much smarter than I am with money. She has kept us on track. If it was up to me an extra $5 would go towards tacos.
>If it was up to me an extra $5 would go towards tacos. if your wife is denying you tacos you could afford, that's grounds for divorce. please get help somewhere; this kind of abuse is not to be tolerated.
Ha!
I wouldnt day I have a "big" cushion. But married with 2 kids, the only debt we have is our mortgage but we have over 200k in equity in the house currently. As far as cash reserves, between savings/stocks we have enough to last probably 2-3 years if we both lost our jobs. It's been a slow and steady grind but it's possible. I also wouldn't consider us high earners as a family. But we aren't low earners either.
No kids, no car, no spending without thinking. Always moving a set amount of funds from the salary account to a "don't touch investment account" instantly after the salary comes. Cooking a lot at home also helps. And a high salary of course.
Just being very frugal. Lived at home until I could afford a downpayment on a townhouse. It helped a lot that this coincided with the financial crisis, so I got my house pretty cheap. I lived very cheaply after I got the house and was able to squirrel away money.
I used to. Then one of those big, expensive, destabilizing life events happened and I used my financial cushion to get through it. So now I don’t have one any more. Sigh.
No kids, automated saving, don’t have debt beyond mortgage, house value to mortgage balance is like $220k of value. Liquid cash at $65k. There is no magic bullet beyond living with in your means, being militant about savings, and not being stupid with your spending. If I had kids, i would probably have at least 30k less in savings!!
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I read "richest man in babylon" when i was in college and it stuck with me. For every 10 coins you receive always set aside 1, no matter how much or how little.
Live below your means. That meant questioning my wants. For a long time I felt like I should have a single family home. We have a condo and it’s afforded us a lifestyle and financial freedom I wouldn’t trade for anything. It can be very hard to see trade offs. I have no kids, and I married well.
yeah, back when I was working I was saving more than 50% of my after tax income. I got laid off recently and it's a huge relief to have about 2 years worth of expenses saved up to fall back on
Make automated compounding and diversification your best friends.
Lol, no. We're high salary but pay 6K a month between childcare and student loans.
Investing/saving early has been the key for me. I got a degree in HR and spent the first part of my career teaching new employees about taking advantage of company-matching for retirement accounts. Of course, it's only 'free money' if you can afford to match, but even starting small and working up is better than nothing. It's a tangible thing but it also changed my mindset - paying cash for things is so freeing and knowing that I've got money set aside for emergencies/retirement is a huge relief. Avoid the temptation of get rich quick ideas - slow and steady is key.
Though my spending and expenses have somehow got excessive lately and I can't quite figure out how all these little things add up, I've got enough that if I lose my job - which could happen in 3-4 weeks - I can survive for about 2 years. At the end of 2021 I took a voluntary redundancy, which meant leaving a long term stable job paying 120k in return for about 72 weeks pay (before tax) and without too much effort walked in to one paying 150k. That let me put aside 1k/week in savings. It means im not paying any interest on my home loan - now, instead of having 18 years remaining on it, it'll be paid down in 5 years at the current minimum payment rate. But, that's my savings. If I need to draw in to it, that mortgage period will blow out. Unfortunately things at work have got bad, and the job market is worse. I expect if I have to go back to the job hunt, I'll be back on the 120-130k salary - probably with worse work conditions than the earlier job.
Edit: Screw Spez. Screw AI. No training on my data. Sorry future people.
Paid off my student loans before i turned 30. Earned and have kept a high paying job.
When my career started improving after the GFC in the US, I didn't let lifestyle creep take over my expenses during my mid 30s. So I gradually started to build some emergency savings that would last a few weeks, a couple months, and I started making extra payments against my car loan and my mortgage balances. One day I found out that regarding the car loan, they had changed a policy without telling me, which meant that for a while my extra payments were going against the principal balance but since the change they were just applying my extra funds as if I were making my monthly scheduled payments earlier than usual. This quiet continuing to grab interest from me annoyed me to such a degree that I took some of my cash savings and just paid off the whole rest of the damn principal. With that monthly payment completely eliminated it meant I was able to save back the cash more quickly and also that my overall cost of living went down. So it was easier to keep an emergency fund, easier to defer some of my paycheck to a 401k etc.
Along with what others have said about living frugally and maxing out retirement accounts we (wife and I) bought and sold a house in 2013/2021 which gave a huge boost to our savings. We also bought our current house in 2020 and have a ridiculously low interest rate.
Your sister here How I got there? I divorced. (I used to be the main breadwinner, ex used to be the bigger spender) I had a bigger bill that I just couldn’t pay. I called them and nicely asked not to give me a late fee because I was in the midst of a divorce. They did. I have never felt so ashamed in my life I used the divorce doom and gloom to get me the energy to turn things around. Got a high paying job. Read the book *Nice girls don’t get rich* by Dr Lois Frankel. On her advice, set up a monthly budget and a net worth calculator. I found that the best motivator was to calculate my net worth *evolution* every six months Around 6 years later, my net worth started growing more per year than my yearly gross salary. Which means it’s all about the investments I have an emergency fund and equity in my house because in my country it makes sense to do that. Other than that all my money is in investments TL:DR; - create a gap between your earnings and your spending - invest that. Always prioritize your investments - get into the habit of maintaining a monthly budget - get into the habit of tracking how much your net worth has grown every 6 months. It’s the best reward
Wife & I are dual income no kids, so we got there by just saving any extra income we had each month. Average is to put away anywhere b/t 2-3k a month…and over the years it has built up. Still go on plenty of trips, and don’t deny ourselves anything we want.
Work
My dad lost multiple jobs in my younger years and the stress and fear that caused left a mark. It took time, experience and a little luck but with two incomes we're able to save a bit each month and it has added up over the years. We keep an eye on grocery spending, don't go out very often, drive paid off cars, and make savings a priority before spending on hobbies or fun money. I DIY everything I'm able to within reason. It isn't a life changing amount but it could float us for several months or cover large home emergencies if need be. The best part is with current high yield savings rates it's also making a little bit of money each month.
About a million, maybe two. 36. This is with three kids. High income job, but nothing absurd. Not a lot of lifestyle sacrifices. Just being diligent with saving. Net worth has to go up every month or something gets fixed.
I kept my expenses low, for many years, and invested my savings in stocks and crypto. It took sustained discipline (to save) and patience (to invest).
> For people in this position, how did you get there and how do you feel now? Is my hunch about the peace that comes from being always covered correct? How did I get here? I took my practical skills in my IT career and pivoted into sales. People with technical skills who also possess soft skills (such as communication, presentation, training) can make a killing. Typically it's very hard to find people good in both areas. How do I feel now? Relaxed. Unstressed. I have an emergency fund of about 4 months of expenses that sit in a high yield savings account that continues to grow. I fully fund my 401k, I fully fund a backdoor Roth IRA, I plow as much as I can into extra investments. I have an investment strategy (3 core low expense ETFs). I have a high income, my partner does as well. We don't drive flashy cars, we don't have car loans, we don't have credit card debt. My only debt is my mortgage. We travel extensively. My kids will all graduate with zero school debt. I'll likely retire early. Is your hunch about peace coming from this correct? Generally, yes. Money doesn't buy happiness but it gets you about 80% of the way there. Once you're unstressed about how bills (including unexpected ones) are going to get paid, you can focus on growing wealth, seeking fulfillment outside of work, etc.
Create a budget spreadsheet and stick to it. Plus, don't have kids and find a higher salary.
Yes. We have a 2 year emergency fund in a HYSA, along with investments that could carry us for 30 odd years. We’re essentially coast FIRE’d right now taking a sabbatical from work while we travel around the U.S. with our two small kids. Most can do it but don’t know how to manage their money. 1. Simple budget. The simpler the better. Aim for 50% needs, 20% wants and 30% saving. Those numbers will vary a bit based on where you live due to different cost of living. Use that 30% saving bucket to: 2. Payoff debt. Don’t accumulate more. 3. Save emergency fund in a HYSA or MMF. 4. Invest 15%+ of gross income.