Here’s our latest interview with a millionaire as we seek to learn from those who have grown their wealth to high heights.
If you’d like to be considered for an interview, drop me a note and we can chat about specifics.
This interview took place in March.
My questions are in bold italics and their responses follow in black.
Let’s get started…
OVERVIEW
How old are you (and spouse if applicable, plus how long you’ve been married)?
I am 35 years old and my spouse is 35 as well.
Do you have kids/family (if so, how old are they)?
Not yet, but hopefully soon!
What area of the country do you live in (and urban or rural)?
We live near the capital city on the West Coast. We like urban environments for ease of amenity access.
I think it’s important to love where you live, however family responsibility becomes increasingly important.
If it were up to me, I’d like to live somewhere a bit more walkable and with more public transit. All the good places to live are fairly overpriced though, so maybe a goal of full FI will be having a home in our favorite city.
What is your current net worth?
$1,120,000
What are the main assets that make up your net worth (stocks, real estate, business, home, retirement accounts, etc.) and any debt that offsets part of these?
Most of the net worth is investments. We do not currently own any real estate. We also did not include the value of our cars, and with the cost of a new Tesla, maybe we should get a higher “score”!
- $450,000 is in cash. The bulk of which is in HYSA and a cash management account at Betterment earning 5%. We have about $20,000 in checking.
- $650,000 is within Roth IRA, 401ks, and brokerage investments.
- The rest is a mix between cash value life insurance and individual dividend securities through Computershare.
EARN
What is your job?
I am currently a financial planner and my spouse is a healthcare professional at a large regional hospital system.
I absolutely love personal finance, however I graduated university with the goal of becoming a healthcare professional. Thankfully that didn’t work out, more on that below.
What is your annual income?
About $275,000 between the two of us.
I currently earn about $150,000 of that.
In addition to my W-2 income, I teach for a community college and conduct workshops that provide about $1,500 per month.
Currently, dividend and interest income is over $2,000 per month (which is why we have so much in cash, plus the idea that we are trying to buy a home and possibly commercial real estate this year).
Tell us about your income performance over time. What was the starting salary of your first job, how did it grow from there (and what you did to make it grow), and where are you now?
My first job was working in the electronics department of Sears (remember them?). I feel like many teens my age worked their first job at a mall. I thought it was a great job, even though it was $7 per hour plus commissions. At that age (17) you don’t really care about pay, because it’s all for fun. Getting a paycheck every few weeks for a few hundred dollars was just for eating out, clothes, things like that. Looking back I wish someone told me to open a Roth IRA at that age! I really did enjoy that job, and similar jobs like that during college, as they are virtually stress-free and you spend much of your time talking to your colleagues until a customer arrives.
After college I thought I wanted to go to business school to get an MBA, but I was tired of being poor and studying. I wanted to learn on the job. I came across a Craigslist job posting (yes that was a thing, especially as a bored 21-year old during the depths of the Great Recession). It was basically working for an insurance agency at full commission. I did well, or so I thought, averaging about $50-60,000.
I briefly worked for a now-defunct brokerage, and then for a large financial services firm in Colorado. That was a 50% pay raise, and higher bonus potential. I had never worked at such a large company, and they provided a lot of perks and benefits like mindfulness sessions, ice cream socials, and things that made workers happy but work more, and I found it more difficult to get a raise or promotion. After 4 years of no raise I decided that I was going to spend that year looking for a new role.
Working at a few startups over the next few years showed me how work can be fun, and how working from home opens up a new world. Everything from incentive compensation to the “unlimited” time off to the technology was better. However, a drawback can be that they will shift their workforce at a moment’s notice because they are more sensitive to funding.
What tips do you have for others who want to grow their career-related income?
Always advocate for yourself. No one is likely going to hand you a job or promotion.
Find out who has been promoted recently and make friends with them, so they can guide you along how it worked for them.
Also, never be afraid to find a new job. Loyalty is to yourself and your community.
I’d also suggest that if you interview, always ask for feedback. You may not get it, and it might not be accurate, but you never know unless you ask. Sometimes you will get the real deal, and that can help you decide how you want to spend your time.
Don’t waste your time on a company that keeps asking for another round of interviews after 3. Don’t let people take your sense of value and belonging. Always remember that getting that next role is a numbers game, and if it didn’t work out at that company, it wasn’t meant to be and you wouldn’t have been happy there.
What’s your work-life balance look like?
Amazing! I work from home, and “work” maybe 5-6 hours per day in front of clients. There is also some admin work I have to do, but overall I have a lot of free time. I heard about this website called “Overemployed” and figured remote workers have a lot of flexibility in working two full time jobs at once and still not get caught!
I have time to run errands during the day, and volunteer for projects to help out with other initiatives we are working on. Plus, it allows me to have the mental capacity for other side income, or attending a city-council meeting on a Tuesday night.
Do you have any sources of income besides your career? If so, can you list them, give us a feel for how much you earn with each, and offer some insight into how you developed them?
Yes, see above. Mainly teaching income and passive income from dividends/investments.
SAVE
What is your annual spending?
Annual spending is about $39,000 per year.
We’re trying to save for a house, and where we live they include things like a fitness center so we don’t have a gym membership or anything like that.
What are the main categories (expenses) this spending breaks into?
- Rent: $24,000
- Utilities and insurance: $2,000
- Groceries, clothes and toiletries: $5000
- Dining out and travel: $5000
Hopefully I’m not missing much of anything. We’re pretty simple people, and like I said, minimalists!
Do you have a budget? If so, how do you implement it?
We split the rent and utilities, and contribute money into our joint account for things like utilities.
I automate at least half our income to savings investments, and then we just enjoy the rest.
We also max out our 401(k)s and IRAs.
I allow myself $200 per month to spend on going out with friends or coffee, smoothies, or treats out with the two of us.
What percentage of your gross income do you save and how has that changed over time?
I would say we save at least 60% of our income. This has been fairly consistent, except when I first moved to Colorado.
We will likely reduce this spending when we find our house or build a house, as renovations and a pool are planned.
Also, kids are expensive so that’s another barrier to high savings.
What’s your best tip for saving (accumulating) money?
Become a minimalist/environmentalist! I am passionate about minimizing my impact on the Earth, so I don’t buy stuff. I have a bike, paddleboard, camping equipment, and things like that. I don’t care to overpay for crowded sports arena tickets or to have pets. We enjoy cooking, visiting new parks, road trips, and just being in nature.
It’s so much easier to reach FI if you learn to just appreciate the simple things. Enjoying nature, spending time with friends, cooking, going to the library or parks. Bike rides.
I will say that trying to be a digital minimalist like many health experts recommended cost me (in theory). I feel like being a financial professional, I was in a prime position to make personal finance YouTube videos early on. I had no idea you could make so much money with YouTube videos until the pandemic, where stories were run on how much some content producers made, and some with a substantial subscriber count moved into million dollar homes in the background. Lesson learned! But I love just tuning out social media and living in the moment.
What’s your best tip for spending less money?
Same as above.
What is your favorite thing to spend money on/your secret splurge?
Smoothies and artisan coffee. I just love drinking them on the go or on the weekend since I work from home. It’s also fun to try different flavors and independent shops.
That, and anything that will get my friends together. I think when you’re out and about, you’re not thinking about work or in front of a computer, and it’s that much more enjoyable to have a mindful experience and take in a treat like that.
I also love mountain biking. I go at least once a year and rent a bike. It’s such a thrill! It’s like hiking but with the thrill of being on a self-propelled jet ski. I really do want an e-bike, preferably an e-mountain or fat tire bike, because that will make it easier to go to a 1-car household, plus it would be so much more fun. Though I think some bikes cost about as much as a used car, $12,000 or more!
INVEST
What is your investment philosophy/plan?
Like many wise people before me, low cost and diversified index funds.
Don’t try and reinvent the game or chase the next fad. Believe in the hardworking people of America.
I also really try to look at ESG-focused funds where performance and fees are comparable. I want to try and invest in companies that are good for society, and that extends to where I do business as well.
What has been your best investment?
The best one that I sold, was Tesla. I made close to $20,000 from that stock alone.
The one I still have is Waste Management, which is up over $15,000 since I bought it. I like their zero-waste focus.
What has been your worst investment?
Coinbase. I don’t know why I bought it, it was my version of speculative exposure to Cryptocurrency. Thankfully it was only $1,500.
Lesson #1 – don’t buy into hype. Lesson #2 – don’t think you can accurately time the market!
I’ll also add that my very first investment was technically my worst, because I put $10,000 of my savings as a college student (most of my money) into front-loaded mutual funds in June of 2008. When the market crashed, thankfully my advisor was smart enough to tell me to hold on, even though he put me in overpriced and underperforming investments. I still hold one of those mutual funds today, as they’ve recovered nicely and just show a reminder to me of the power of time.
What’s been your overall return?
I’d say about 8% in the brokerage account, 9% in the retirement portfolio.
How often do you monitor/review your portfolio?
At least once per week. All the apps on your phone these days make it easy, you don’t have to wait for a paper statement in the mail anymore. (I have e-delivery now so I guess that’s almost the same thing).
On my brokerage account, I check it almost every weekday to see what dividends have been paid and what the watchlist looks like. It’s always nice to have something to take a look at as well.
NET WORTH
How did you accumulate your net worth?
Mostly it was just focusing on 3 things: Watching expenses, earning more at each job, and trying to make sure each role had some kind of incentive compensation available.
No inheritance, though my lovely parents did me a solid by paying for college tuition and letting me live at home for free as long as I needed to. I helped by doing chores and taking care of maintenance and landscaping, so I guess it was a good deal for both sides?
What would you say is your greatest strength in the ESI wealth-building model (Earn, Save or Invest) and why would you say it’s tops?
Saving.
I learned from my grandfather the concept of watching your pennies and the dollars will take care of themselves. I’m frugal, but never cheap. It’s important to me to spend on things like health and wellness, proper tips, and charitable giving. I see it like a game. I try not to spend money Monday-Thursday (except at the grocery store and for pre-planned online purchases).
Earning is something I feel like I can use the most help with. I haven’t been able to get the income gains as some peers who get their CFA, or people in tech sales, or those who work at startups.
So many people I know started making this money only a few years ago and have comparable savings, and that kind of hurts when you’ve been a diligent saver for over a decade. The lesson here is that Earning is unlimited, so focus on that if you can, but don’t beat yourself up if you want to be in my camp of work life balance and happy with being able to save half of your income (that’s a lot better than many people!)
What road bumps did you face along the way to becoming a millionaire and how did you handle them?
3 things come to mind.
First, not investing as soon as I earned an income, into a Roth IRA or similar vehicle.
Second, not buying a home when they were cheap, because I wanted to explore other cities and figured I’ll wait until the next crash.
Third, not wanting to be in a relationship until my 30’s. I always thought women spent too much money on things like nails, hair, makeup, etc. I figured as a guy I’d have to take her out to fancy restaurants every weekend. Little did I realize life would have been half the cost as well if I could rent a studio or 1-bedroom instead of a 2-bedroom and split groceries, entertainment costs, etc.
As a bonus, I would add leveraging social media to earn money, but I already covered that above and feel like that ship has sailed. I’m happy to not be glued to my phone.
What are you currently doing to maintain/grow your net worth?
Keep saving at least half of our income! Hope this can continue after buying a home, but after having kids is anyone’s guess.
I’m also trying to get a higher paying job each year. The market’s in an odd place right now. I feel that each year there is more and more competition in this field, and for every job there are hundreds of applicants. This is why I’m leaning to go self-employed in the next 5 years. You can only bet on yourself.
Do you have a target net worth you are trying to attain?
Right now it’s $4.5 million. That will enable me to make sure there is enough for the lifestyle I look forward to and also not have to worry about crazy events throwing our plan off balance.
Ultimately this number might be affected by the kind of home we buy, but we also have a dream of building our own home. Hopefully I can buy land cash at a good deal and hire a General Contractor at a time when they are hungry for work. I want to pay them fairly, however the cost of housing right now is astronomical and I hope they don’t get used to those prices!
How old were you when you made your first million and have you had any significant behavior shifts since then?
The age I am now, 35! Since it just happened, no shifts yet, however I don’t anticipate any changes until we buy a home. I would like a used sports car though! Or an e-bike as I mentioned above.
That’s the more pragmatic solution, because as I think about it, you can’t even drive anywhere these days without getting frustrated at the lack of courtesy of many drivers, not to mention aggressive drivers. At least with biking, there is never traffic in the bike lane, there is always free bike parking, and you never have to wait in line or park far away for events!
What personal habits and/or traits have you developed that have made you successful at growing your net worth?
Delayed gratification and impulse control.
I don’t feel the need to get a good deal to shop, or buy things, or take a trip right this second. I’ve learned that I really align with the minimalist lifestyle, and that protects our natural resources as well.
I always try to be a sponge and learn. Much of what I’m reading these days is repetitive, since I read over a hundred books on personal finance in the last 10 years. However, there’s something to be said about having an open mind and a growth mindset.
What money mistakes have you made along the way that others can learn from?
Don’t think you can time the market, whether real estate or investing.
Don’t stay in a mediocre job too long. No one is going to vouch for you as much as yourself. If you’re not getting paid what you are working for, or feel undervalued, time to make a change.
I wish I had bought a home in 2011! I wish I had invested more in 2011! I wish I didn’t try to “time” the bottom of the market crash in March of 2020 when the lockdowns occurred. I also wish I fought harder for raises in my previous roles.
What advice do you have for ESI Money readers on how to become wealthy?
Enjoy your life, and spend time with your friends.
Money doesn’t have to play a role in that. Invite them over for a potluck or go on a bike ride together. Think of the simple things we used to do as kids.
We don’t need to go to a fancy brunch or ostentatious dinner party to keep up with the Joneses. Life is nothing without good company, and having good people around affirms that you have enough and don’t need to compensate for it by buying material things or appearing wealthy on the outside.
FUTURE
What are your plans for the future regarding lifestyle?
I’m not close to retirement by any means at this point, but I do want to work towards financial independence. I hope to have enough income to cover my fixed costs, and then work on side projects or business ideas that can fail without affecting my family’s financial wellbeing.
Everyone who’s done this interview is right, having money enables you to take the road that feels right, not hunker down and take crap from anyone just because you need a paycheck. Those days are thankfully behind me.
MISCELLANEOUS
How did you learn about finances and at what age did it “click”?
When I started reading Money magazine (no longer in print sadly) back in 2010 in Barnes and Noble.
I was fresh out of college and hungry to learn about how to make money after being a broke college student. The financial crisis was all over the news and I wanted to learn how to protect myself from the fate of my neighbors, whose homes were being foreclosed on.
Who inspired you to excel in life? Who are your heroes?
My mother is an incredible human who came from nothing and became a millionaire while supporting everyone in her family. She showed me how much one is willing to sacrifice to build a life of stability and safety.
My father never earned much in his career, but came from a well-off family. She worked tirelessly to earn more, start a business, buy a home, raise kids, and send us to college debt-free. All while taking care of her extended family and being an amazing friend. She never complained, and always had an optimistic attitude.
Everything I do I hope to make her proud and be there for her to make her life better.
Do you give to charity? Why or why not? If you do, what percent of time/money do you give?
Yes I do. I am very passionate about a few causes. Most of them are environmental/conversation based, such as the local Land Trust and coalitions to reduce plastic waste.
I am also passionate about multimodal transportation and advocacy, raising funds for more bike lanes, trails, parks and public infrastructure. There’s no reason why a courthouse for criminals should be so much nicer than public libraries.
Do you plan to leave an inheritance for your heirs (how do you plan to distribute your wealth at your death)? What are your reasons behind this plan?
Yes, when we have them. At least enough to make sure they can be contributing members of society without debt.
Also will plan to support nonprofits around cycling, conservation, and youth development. We’ve all got to do our part to make the world better than we found it.
The people who planned and built the many parks and wonders of the world didn’t build them for themselves, they built them to future generations can enjoy them. We have to do what we can to maintain the generosity of humanity.
Can I ask why your FIRE # is so much higher than your current spending? $4.5m at 4% withdraw is $180k/year spending, which is more than 4x your current spending.
Either your sacrificing a lot right now or your going to waste time earning money you’ll never spend.
That said, I’m with you on minimalism!
Yes the reason is right now we rent, and we plan to have kids, so just planning to have a buffer with those large expenses.
Great interview and congrats on your success! May I ask how you went from thinking of being in health care to being a financial planner? I find that I enjoy financial planning and am thinking of transitioning. Advice on how to best go about getting financial planning certification/experience?
Great question, it was mostly introspection and talking to older mentors of mine. I realized that I didn’t want to spend another 4 years in school and take on debt, and had always enjoyed personal finance content. So, I went to work for a full-commission insurance company to get experience and licenses. If you want financial planning, I’d suggest maybe starting by taking some CFP courses at the community college or your local University extension.
Thank you for sharing!
Deferred gratification and simple living is also how we became multi-millionaires suddenly over twenty-two years. As public servants throughout our post-college careers, we never made much before retirement, especially considering many of the household salaries I’ve seen on ESI. Yet the status came to be without us really pursuing it, by tithing and giving abundantly to the Lord’s work, budgeting implementing reasonable spending, saving, and investing patterns in our lives (once our eyes were opened to the bondage we were in and wanted to get out of), and diversifying holdings via no-load low-expense stock index mutual funds and about 25 to 30% fixed income vehicles. We haven’t missed a thing that’s really important in life and have been involved in some awesom ministries helping others experience freedom in lifestyle and finances.
Thanks for reading. Agree on the balance aspect. It’s not hard, it just takes time.
Congrats! Well done on keeping things simple and staying focused! While it may be simple, that doesn’t mean it’s easy.
Earning more is something most folks seek. What are the levers that would allow you to earn more? How would going out on your own achieve that?