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 38 and my husband is 45.
We’ve been married for almost 8 years.
Do you have kids/family (if so, how old are they)?
We have three beautiful girls ages 6, 4, and 22 months.
What area of the country do you live in (and urban or rural)?
We live in a fast-growing mid-sized city in the southeast.
What is your current net worth?
Total net worth is ~$4.86M.
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?
- Investable Assets: $3.14M
- 401ks – $617K
- Rollover IRAs – $1.4M
- Brokerage Accounts – $504K
- Company Stock – $88K Vested ($177K unvested and not considered as part of NW)
- Pensions – $184K
- Cash – $200K
- 529 – Kid #1 – $70K
- 529 – Kid #2 – $52K
- 529 – Kid #3 – $28K
- Real Estate: $1.72M; Primary Residence – $1,200,000 (Paid $670K; $345K mortgage @ 1% interest… not paying it off anytime soon!)Long Term Rental – $420,000; (paid $185K; no mortgage); Short Term Rental – $850,000 (paid $550,000; $405K mortgage @ 2.85%; no plans to pay off but we might one day if we decide to keep it a long time.
Note: We have no other debt besides the mortgages, but do not consider cars, jewelry, etc. as part of our net worth.
EARN
What is your job?
Both my husband and I hold director level corporate roles for Fortune 100 pharmaceutical companies that you have likely heard of.
What is your annual income?
It depends on the year with bonuses, etc. but somewhere in the ballpark of ~$500K cash and another $100K in equity.
My base salary is $195K with 25% bonus potential and ~40K annual equity grant, husband’s salary is $200K with 24% bonus potential and ~60K annual equity grant.
Our combined bonuses usually come in around $100K or more, but can be variable depending on company performance.
~$20K income after expenses for two rental properties (one short term rental & one long term rental).
The equity grants mentioned above are a combo of stock options and restricted stock units that both of us receive. There’s a 3-year vesting period (i.e. golden handcuffs), so I don’t consider that to be actual income but more longer-term savings.
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 out of college at age 22 was selling copiers and my base salary was $30K.
I quickly decided that was not for me and used it to spring board into the pharmaceutical industry as a sales associate making $45K.
I got promoted into a junior sales rep role making $60K and then decided to go the corporate route.
I relocated to one of our regional offices spend some time as a junior sales trainer making $70K per year.
A great territory opened-up in my home state so I went back to sales and more than doubled my income as a sales rep making ~$180K.
Mind you, I was 26 years old and this level of income continued for several years. I then met my now husband who got an amazing opportunity in tech out in California. Lucky for me, my company’s corporate headquarters was also there, so I transferred and pivoted over to a marketing role to follow him.
To do that, I took a more junior role just to get there quickly, and cut my income in half to $90K. A few months later got promoted to a new role making $120K. We do crazy things for love, right? 🙂
A year or so before we got married, we decided the city was not the place we wanted to raise kids, so we relocated back to the east coast to be closer to our families. As part of this move, I switched companies and have taken a series of Marketing & Communications roles now landing me at the director level. I’ve been a director for ~5 years.
What tips do you have for others who want to grow their career-related income?
Put in the work early in your career and you’ll reap the benefits later.
I spent many nights and weekends in my early 20’s working crazy hours trying to get ahead while my friends were out having fun at the bars and parties. It’s not that I didn’t enjoy being social, I just knew I wanted to do big things with my career and being tired and hung over wasn’t going to get me there.
I also recommend networking constantly. Don’t wait for the opportunities to come to you. Find a mentor or someone whose job you think you want one day and ask them to have a career conversation with you. More often than not, you’re met with an enthusiastic yes and build relationships that last years and can come in handy when you least expect it.
You should also switch companies a time or two. Unfortunately, companies don’t reward loyalty and you’ll continue to get your 2-3% raises every year (maybe a 10% jump if you get promoted) but otherwise, it’s very hard to make big income jumps by staying at the same place. I switched jobs during the pandemic when companies were paying premium salaries and was able to increase my base salary by $40K. I quickly realized the new company was not for me, but because of the relationships I had with my old company, they hired me back 10 months later, gave me more money than what I left for, and paid me a $30K signing bonus.
I’m now at a point where I feel like my compensation is aligned, but it took some movement to get there.
What’s your work-life balance look like?
It’s much better now than it was while I was in sales or other roles that required me to travel internationally. 50-60+ hour weeks on top of travel were the norm for many years, especially while I was trying to get ahead. However, having children slowed me down a lot.
Even if I wanted to work long hours and travel all over the world for meetings, I couldn’t because of my added responsibilities at home. Some weeks I work 40 hours, others might be 50+ if there’s a big project going on, and some weeks might be much less.
Both my husband and I travel (him more than me), so we’re constantly balancing to make sure that one of us is always home while the other is away. My current role doesn’t require a ton of travel and if I do have to go somewhere, it’s typically domestic so very manageable. We also both work from home, so that provides a lot of flexibility.
The way I look at it is that some weeks are family weeks where I have a lot of responsibility at home, and other weeks are work weeks where I have to prioritize my career. We also have a live-in nanny (who is very much part of the family) to help us run our household.
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?
Outside of our careers, we have two rental properties.
One is a long-term rental that makes about $20K per year before expenses. The second is a short-term rental in a hot beach town that makes about $60K per year.
However, after expenses, insurance, etc. we break even or take a slight loss on the vacation rental. We’re fine with it because we use it as much as we can.
SAVE
What is your annual spending?
~$200-$235K; some years more, some less but this is a good average.
What are the main categories (expenses) this spending breaks into?
- Mortgage, taxes, insurance, HOA – $29K
- Utilities/cell phone/internet – $7K
- Lawncare – $700
- Tax & Tax Prep – $13K – With multiple LLCs and being high earners, we always budget to pay Uncle Sam.
- Home Improvement/Maintenance – $12K – this is variable year to year
- 529 Contributions for 3 kids – $45K – Before you think this is crazy, know that we plan to fund each kid $100K and then let it grow. We plan to have the kids funded in the next few years before we hopefully pursue early retirement. We feel better getting this obligation out of the way before hanging it up at work.
- VUL Life Insurance – $5900
- Transportation (Gas, insurance, maintenance, etc. for 3 very average, paid for cars) – $3K
- Groceries – $13K
- Household items (i.e. school supplies, amazon orders, and misc.) – $7K
- Preschool/Private school tuition – $20K – this will go up as we have the other two girls enter grade school.
- Child Activities (dance, swim team, gymnastics, etc.) – $4600
- Childcare – $35K – we have live-in care so covering her living expenses, car, phone, etc. offsets what we pay in salary.
- Dining out – $8500
- Clothing – $6000
- House cleaning – $2000
- Salon/Barber – $2500
- Entertainment & Gifts – $12,500 – includes donations to our girls school, all the birthday parties, Christmas, etc.
- Exercise (Peloton & Tonal memberships) – $1400
- Healthcare – $5,000
- Vacations – $16,000
Note: These expenses do NOT include the rental properties. We run them as separate LLCs and have enough cash flow to keep the finances completely separate from our personal accounts.
Do you have a budget? If so, how do you implement it?
We budget religiously. It’s kind of fun for us.
At the beginning of every year we set our budget for every known expense category, and then hold budget meetings monthly to see how we’re doing each month. My husband mostly manages the nuts and bolts of budgeting because he’s better in Excel than I am and also knows how to use Microsoft Money that imports all our expenses. However, we are both equally invested in understanding where our money goes and how we make money decisions.
I can’t say we follow our budget exactly as there’s usually a home project that comes out of the blue, etc. but we typically stay within $10-20K of what we budget for the year. Not to mention we plan expenses that are way less than we make, so neither of us are overly stressed about it.
With three young kids, we find ourselves throwing money at things for convenience. We were much more frugal when it was just the two of us and when we had fewer children. We are fully aware that we have a lot of room to be more frugal!
What percentage of your gross income do you save and how has that changed over time?
I can’t say for sure, but my best guess would be around 25-30%.
Now that we are within reach of early retirement, we are trying to bump up our post tax investments that would bridge us to retirement. We both max out 401k, contribute to post tax Roth 401k, invest in Vanguard account (VTSAX), heavily fund children’s 529 accounts, as well as contribute to an employee stock purchase plan.
We could obviously do more by the looks of our budget, but I think we do a pretty good job and are on track to meet our goals.
What’s your best tip for saving (accumulating) money?
Find a job that pays enough to support the lifestyle you want and be the absolute best at it.
Go above and beyond and be the hardest worker on the team.
Aim to never be the smartest in the room. Put yourself in the position to be around people smarter and more successful than you when it comes to your career.
Ask your boss how you can help THEM get a great performance review for the year.
All of those things done consistently with a little luck and timing on your side can make a huge impact in growing your income.
Finally, don’t be afraid to jump ship to a new company a time or two. It’s good to have a new perspective, and your potential for a big hike in salary is much greater than if you stay at the same place your entire career.
What’s your best tip for spending less money?
Ugh. I wish I was better at this.
I tend to go for convenience, whereas my husband looks at opportunity cost. That said, we have several stores we do our grocery shopping at because the cost is better on certain things. It makes a difference with 6 people living in our house.
We also don’t drive nice cars. We buy new, practical cars and plan to drive them for at least 10 years. While I would love to trade in my minivan for a Tesla with Batman doors, it’s just not practical at this point in time, nor will it help us reach our long term financial goals.
We shop at Costco a lot, try to ensure we are not wasteful with electricity, water, etc. but I’ll be the first to say we could do better with saving. We have young kids and not a lot of time, so sometimes it’s just easier to throw money at a problem than to scope out the best deal.
What is your favorite thing to spend money on/your secret splurge?
Vacations and fun activities with our girls are top of the list. I love giving them experiences I never had growing up and seeing their little faces light up.
My husband and I both are really into tech fitness. We built a home gym with some fancy equipment and I don’t apologize for it for a minute. It saves us time, helps us prioritize our health and we enjoy it.
Outside of that, we don’t have a ton of expensive habits. We buy nice things within reason.
INVEST
What is your investment philosophy/plan?
Spoiler alert… we’re not unique. It’s simply to earn, save, and invest.
I’d also add to enjoy life a bit along the way.
We could be a lot further along right now had we made a few different financial moves, had one less kid, or chosen public school but we’re content with the progress we’ve made, see a path to the finish line and are based on statistics I read, we’re ahead of most in our peer group.
What has been your best investment?
Another non-unique answer… it’s my husband.
Not only is he my partner in crime, he keeps me accountable for our finances and basically everything else in life. Haha. We have things we agree to disagree on, but finances are not one of them.
I’m very thankful for the life I’ve been able to build with the best partner I could have ever imagined.
What has been your worst investment?
I don’t know if I can pinpoint to one particular investment that was terrible, but we did hire a really awful financial advisor at one time.
I can clearly remember there was a year that the market was at an all time high and we frequently lost money when every financial market was up. We came to learn he was a stock picker, I’d argue a gambler, and we very quickly changed course and lost out on a lot of growth.
We do have another adviser today that we pay a very low fee for, but we’re starting to wonder whether the juice is worth the squeeze. There’s a lot of great options to self-manage and we may do that at some point when we have more time to devote to it.
Question for readers: Is there a fiduciary, fee-based advisor service you would recommend? We are old school and like to talk to someone, but don’t necessarily need them to manage our portfolio. I’d love to understand who others use!
What’s been your overall return?
10% is a best guess estimate.
How often do you monitor/review your portfolio?
We review our portfolio together monthly. It’s in the form of a budget meeting when the kids go to bed and usually involves a beer.
Every time we hit another million, we do something small to celebrate like go out for a nice dinner.
Then we move on and look forward to the next milestone!
NET WORTH
How did you accumulate your net worth?
No special formula other than hard work, earning, saving and investing.
We have not inherited anything. Although we may inherit something in the future, we do not plan for that when we think about what we will need to sustain our future.
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?
I would say earning because that’s where most of our effort takes place. We are both fortunate to have very good salaries, bonuses, and long-term incentives/stock plans at our respective companies.
We are also decent savers but could definitely do a better job. It’s just hard to work as hard as we do and not enjoy life a bit as we go along the journey. We do a good job making sure our income far exceeds our expenses and could weather virtually any emergency that comes our way.
Neither of us are very savvy investors but we are disciplined in our contributions and don’t panic when the market takes a downward swing.
What road bumps did you face along the way to becoming a millionaire and how did you handle them?
I personally did not grow up with a lot of positive financial influence. I knew nothing about money management when it was time for me to go out on my own and make my own way. I just knew I didn’t want to end up like that.
Regardless, I managed to racked up credit card debt in college, spent every dime I made, and can remember feeling the pressure of living paycheck to paycheck into my early 20’s. I always invested in my 401k but only enough to get the match because that’s what I genuinely believed you were supposed to do to be able to retire at 65. I was able to pay off my debts in my mid-20’s because I was making a very strong income.
It wasn’t until I met my husband that I really started to learn and understand how finances work. He was much better than me at saving at an early age, maxing out 401k’s from the first year he started working, and generally making smart financial decisions. Fortunately by the time I met him, I owned a home, was out of debt and had some savings.
I wish I knew then what I know now and am actively working with my 4 and 6 year olds to make sure they understand age appropriate finances. No matter how much they may not be interested, I am committed to making sure they understand personal finance before they are out on their own.
What are you currently doing to maintain/grow your net worth?
We max out 401Ks, save a ton for college so those expenses won’t be a stressor down the road, actively contribute to brokerage accounts, and more importantly, we’re staying the course.
We also have our real estate properties that we manage on the side. While its kind of a pain at times to rent our beach house, we don’t use it nearly enough and I really like that other people pay our mortgage and expenses every year. Our rental rates are also high enough that we attract responsible tenants.
Do you have a target net worth you are trying to attain?
Our goal is $6M in investable assets.
I think that’s enough for an early retirement with kids in the house while not requiring us to cut back our lifestyle too much.
If we get into a pickle and need some cash, we could either go back to work or sell a house if we needed to.
How old were you when you made your first million and have you had any significant behavior shifts since then?
I was 32 and my husband was 38.
We started our marriage with a combined portfolio of $900K and have managed to grow it quite a bit in 7 years through investments and real estate.
We haven’t made any radical behavior shifts. If anything, we are more motivated to save because we see how fast the money can grow and there’s an end in sight our careers in corporate America.
What personal habits and/or traits have you developed that have made you successful at growing your net worth?
I think my work ethic has made me successful, particularly as it relates to growing my income/net worth.
I went to an average university for undergrad and graduate school, had no help in making connections to get jobs, etc. but I had a drive to become successful.
I put myself around people that could help me and even if I wasn’t the smartest person in the room, I was the one working the hardest and finding ways to go above and beyond to get to my next promotion.
My desire for moving up the ladder has dissipated a bit since my family life is now more important to me than my career, but the same principles still apply. I am dependable, I produce quality work, I am easy to work with, and am kind to people. All of those things to this day continue to help me get ahead.
What money mistakes have you made along the way that others can learn from?
I was notorious for spending everything I earned when I was younger and lived paycheck to paycheck into my mid 20’s. I thought it was normal and that saving enough in my 401k to get the match would ensure a good retirement.
I was also very intimidated by finances for a long time and didn’t want to learn more. I’m very glad my mindset changed and that I was able to turn things around before getting myself into real money trouble.
What advice do you have for ESI Money readers on how to become wealthy?
There are no shortcuts in building wealth. Earn, save and invest. It’s simple but not easy.
Don’t wait to start saving even if you don’t make a lot. The power of compounding interest over time is truly incredible.
FUTURE
What are your plans for the future regarding lifestyle?
We are planning for early retirement.
I imagine we will downsize at some point, but we will likely still have school age kids at home and will keep our house until our youngest is off to college.
What are your retirement plans?
My husband and I plan to retire early and feel comfortable doing so when we have $6M in investible assets which we estimate to be around 4-6 years. My husband may work a few more years until 55 to take advantage of his employer’s generous health plan.
By reaching a certain number of years of service + age, our family can stay on the company’s health plan at a reduced rate until we qualify for Medicare. He may decide to call it quits earlier, and that is fine too. There are alternative health plans we will look into.
We plan to travel quite a bit and would like to give our kids travel experiences as well during school breaks while they are still at home. We will both likely volunteer or perhaps work part time in something that brings us joy to fill our time. We’re still figuring out what that looks like.
Are there any issues in retirement that concern you? If so, how are you planning to address them?
Right now, I know what I want to retire from, but have nothing to retire to.
The years the girls are still home will keep me busy, but I need to get serious about figuring out what I will do with my time whether it’s volunteering, consulting, substitute teaching at our girls’ school, etc. I have some ideas, but will not be ready to call it quits until I have that plan fleshed out.
We also of course worry about running out of money, but if our health stays in tact we should in theory be able to go back to work if we were to have something unforeseen happen.
MISCELLANEOUS
How did you learn about finances and at what age did it “click”?
I started to get more financially savvy when my income hit a high six figures because I knew I needed to save more.
However, I didn’t really learn the ins and outs of investing, saving, etc. until I met my husband. He’s helped me a lot and we have learned a lot together along the way.
Who inspired you to excel in life? Who are your heroes?
While my parents were always supportive of me, it was my aunt and uncle who really gave me a drive to excel in life and become more than I ever thought I could be. They were like a second set of parents to me and always pushed me to think beyond the limits of the small town I grew up in, etc. They were wealthy and I knew I wanted to have a life like theirs.
I am forever grateful to have had their influence as I know I would not be where I am today without them believing in me and instilling confidence in me.
Do you have any favorite money books you like/recommend? If so, can you share with us your top three and why you like them?
- The Millionaire Next Door
- Simple Path to Wealth
- Millionaire Habits (Thanks, ESI, for the recommendation)
I like all of these because they reminded me that perception is not always reality. Just because your friends are buying fancy things, taking big trips, driving nice cars, etc. doesn’t mean their net worth correlates.
They also give very practical advice for how to invest simply, stay the course, and play the long game.
Do you give to charity? Why or why not? If you do, what percent of time/money do you give?
We give regularly to our church and support our daughter’s schools that are also affiliated with our church.
We also support other organizations that are dear to us or family.
We also try to give our time to our daughter’s schools while we can, but it’s challenging working two busy jobs with three young children at home.
Giving and volunteering are areas we plan to continue to increase over time.
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, our money will be split evenly amongst our daughters.
We have trusts set up for them now should something happen and they would get a couple of distributions throughout their adulthood.
No big windfalls…we want them to make it on their own first.
We will also consider a gifting strategy that would help them out while we are still here.
You are doing amazingly, outstandingly, uncommonly well and should be so proud of all of your discipline and accomplishments! It is good to hear that you treat yourselves to nice things. Money is a tool and should be used to add ease and pleasure to your life. Well done!!
Thank you so much. We are so very grateful for all of our blessings.
Great job on your journey, almost to your goal and without sacrificing cost of living. For advisors, I’d recommend letsmakeaplan.org, the CFP website where you can find an advisor close to you. Or your local FPA chapter.
Thank you! Really appreciate that.
We have used a fee-based financial advisor a few times for a heading check, to help look for blind spots, and to reassure my wife that we were on track … but I remain unconvinced that they add significant value. The mere fact that you participate here means you have your ducks in a row already.
To answer your question – we found one by a friend’s recommendation, and followed up with another after the free lunch/seminar. Really though … you already know there’s no secret. Good luck.
Thank you!
Is there a fiduciary, fee-based advisor service you would recommend?
Assuming you have accounts with Fidelity or Schwab, have you tried using their free advisors that they typically grant to people with over $2M? At $2M+, you can typically select experienced free “VP level” advisors that can review your portfolio and strategy for free. I’ve bounced my strategy off Fidelity guys for years just for a sanity check and never felt pressured to go with any commissioned product. We have accounts with vanguard, Schwab, tradestation (took up a sign up promo) and Fidelity but if you upload your full portfolio (using full view) the fidelity advisor can analyze your entire portfolio. My guy ran some planner analysis that only they have access to (I asked about when might be best to do roth conversions) and found my guy to be pretty competent. He asked good questions and was a good sounding board for diy investors.
Interesting because we have most of our assets with Fidelity now. I will look into this. Thank you!
Your #’s don’t add up for me. You grew your wealth from $900,000 to $4,800,000 in 7 years? Using a single Vanguard ETF as your primary investment tool. I don’t see how that is possible. Warren Buffet would hire you today 🙂 And accumulating $4.8M when you’re both <45 years old, with 3 (little) kids <6 years old, zero inheritance, and combined annual income of <$500,000? I don't think it's possible – even if you saved every $1 you made and had $0 expenses you'd be hard pressed to get there.
Real estate was a big driver. If you read the breakdown of the #s, investable assets are $3.14, and real estate accounts for $1.7. I’m sure you’re aware of the ridiculous growth in real estate the last few years as well as strong performance in the stock market. But you don’t have to take my word for it…the numbers are the numbers. 🙂
I like the following comments, “We give regularly to our church and support our daughter’s schools that are also affiliated with our church. We also support other organizations that are dear to us or family.” and “I am committed to making sure they understand personal finance before they are out on their own.”
Thank you for sharing your story!
Thanks for reading it!