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 June.
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 56 and my wife is 57. We have been blessed with 34 years of marriage.
We met in high school and got married shortly after graduating from college.
Do you have kids/family (if so, how old are they)?
We are the proud parents of 3 girls, aged 19, 25, and 27. We also have one son-in-law.
Our older two daughters are launched in their careers, while the youngest is a college freshman.
We are expecting our first grandchild fairly soon!
What area of the country do you live in (and urban or rural)?
In the Midwest in a suburban setting.
I work in a downtown urban area.
What is your current net worth?
Our net worth is $6.8 million.
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?
- Cash = $1,400K
- Investments in Brokerage Account = $840K
- 529 Plans = $250K
- HSA = $170K
- 401k, IRA, and other retirement plans = $2,300K
- Homes (primary residence and lake home) = $900K
- Interest in family-owned land (estimate) = $1,000K
We have no debt other than credit cards that we pay off each month. We haven’t had a mortgage since about 2009.
Not included in the above are two donor-advised funds that currently total $750K. This money is not “ours” but was funded by us and we are able to direct how it is spent for charitable purposes.
EARN
What is your job?
I am a Finance Director at the headquarters of a small-ish financial services firm. My (2 people other than me) team and I are responsible for financial analysis, budgeting, forecasting, and decision support supporting the senior leadership team here.
Late breaking news: I recently moved on from this job to join a small Christian non-profit as CFO in the next few months. I think this job will be both very fulfilling and fun but also really challenging!
What is your annual income?
The salary of my new job is $110,000 per year. In my most recent job, my salary was $195,000 and I had a target bonus of 50% of my salary.
It is with some sadness and anxiety, but much hope, that I am saying goodbye to my high salary, annual bonus, and stock awards – gulp!
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 full-time summer job in the mid-80s paid $4 per hour and was an upgrade from the part-time jobs I held in high school. It was with the county highway department and I logged 50-60 hour weeks or more.
Then after I turned 18 I was able to land a summer job making $7 or so at the factory where my father worked as a mechanic but I also received overtime with 50-60 hour+ weeks.
This work, along with the help of my parents, financial aid, and a reasonable amount of debt, got me through college at a great, small private school despite the fact that neither of my parents went to college and their means were not great. This helped me solidify the strong work ethic that my parents always taught me and served me very well in the future.
My first full-time job after college paid $24,000 per year as an analyst in a consulting office. Subsequently, I moved on to work in IT at an insurance company and then as an actuarial student/assistant at another company.
I ended up earning my full actuarial credentials and staying at that firm 22 years, starting at a salary of $36,000 in 1993 and ending at $206,000 in 2015. I changed jobs while at that firm about every 3 years or so on average.
That way I was able to see a lot of what the company does and how it works and it set me up for the executive-level roles I would hold later.
What tips do you have for others who want to grow their career-related income?
Being bright and hard-working is “table stakes” to grow your influence (and your compensation) in organizations where I have worked.
What will put you on a faster track is 1) gaining context – knowing not just your job but your boss’s job and beyond 2) independence – if you show you can be a self-starter and execute with little direction you show that you are ready for the next role and 3) If you want to be promoted to level “x” – you should act like you are level “x” and after about a year it might just happen.
My other tip might be a little controversial. My wife had a great career as an actuary early in our marriage but has not worked outside our home since before we had our first daughter (and that’s almost 30 years).
While having more income in those early years would have been nice, I speculate that we as a family have earned more money as a 1-income family than we would have as a 2-income family. Your results may be different!
I was able to do things I wouldn’t have otherwise been able to do so freely knowing that my wonderful wife has things covered at home, like studying for exams and earning my actuarial credentials, traveling extensively, and burning the midnight oil every now and then.
It also freed me up to be really present with my family when I was home. That’s how things worked out for us. As they say, your mileage may vary. . .
What’s your work-life balance look like?
We are enjoying being empty-nesters and I have a decent work/life balance. In times of stress (like an M&A deal, a transaction dealing with the estate, etc.) balance can get out of whack.
But in general, I feel good that we can take time away to enjoy our family and relax from time to time.
In my new job I am trying to establish boundaries early on – like not being on top of e-mail 24/7, taking my vacation time, etc.. My only point of negotiation in taking this new job was to get 25 days of vacation and I plan to use it!
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?
My only “side hustle” is the significant time I spend helping to manage my wife’s family’s estate. My wife’s family owned some significant (farm) land in a nearby suburb that has become pretty valuable as our metro area has expanded.
Upon the passing of her parents, my wife now owns this land with her two sisters. She and I tend to be the most business-savvy within the family so we are quite regularly dealing with lawyers, accountants, real estate agents, the city, the county, potential developers, the IRS, and the list goes on!
This “job” has paid well so far, as we have slowly liquidated over the past 10 years or so (and continue to do so).
SAVE
What is your annual spending?
(Significantly) less than I earn!
Seriously, it really varies but I’m estimating about $80K per year exclusive of taxes, giving, saving, and payroll deductions (insurance, etc.).
What are the main categories (expenses) this spending breaks into?
Here is my shot at categorizing a “normal” month using data from early 2024. We don’t often look at this so thanks for asking!
I can’t attest that I’ve looked at and categorized every transaction but here goes.
- Insurance (cars, two homes, boat) = $800
- Travel (2 trips per year at about 10K each) = $1,600
- Restaurants (includes lunches at work) = $600
- Property Taxes (2 homes) = $900
- General “stuff” = $600
- Utilities (for 2 homes) = $400
- Personal Care/Peloton membership = $150
- Groceries (not included in general “stuff” above) = $250
- House Cleaning = $300
- Entertainment (incl. subscriptions) = $250
- Medical/dental = $175
- Internet = $100
- A bunch of other stuff including clothing = $200
So we are at roughly $6,500 per month or $78,000 per year. We may need to make some tweaks if we want to manage our new income level.
On top of that, a “normal” year of charitable giving for us is about $70,000. In years when we have “lumpy” income we give more.
Do you have a budget? If so, how do you implement it?
At the beginning of our marriage we used to have a budget and track our spending carefully (we had many floppy disks that held Quicken data!) I’d say in the past 10-15 years we kind of manage by feel – we know what we normally spend and when we are going off the rails.
We also can see how much we are saving and giving and whether that is going in the right direction.
What percentage of your gross income do you save and how has that changed over time?
For the past decade, I have put the maximum allowable into my 401k, including “catch-up” contributions since I am over 50.
What’s your best tip for saving (accumulating) money?
Always, always, always automatically put money in your 401k/403b to get the maximum match from your employer. If you have two incomes and think you may be going to one income, live off one income and save (or pay down debt with) the rest.
Take advantage of tax-deferred and tax-free investments – here are two:
For several years, I had a high-deductible health plan (HDHP) and contributed the maximum I was allowed into an HSA. I then used cash to pay all of our medical expenses (i.e. I have not ever withdrawn from my HSA). I did this because this is one of the few ways to invest tax-free-in-tax-free-out.
I now have a nest egg of over $100K to pay medical bills while I am in retirement via tax-free withdrawals from an HSA.
Secondly, I took advantage of 529 plans. I funded these when my kids were young and let them grow.
Then I was able to withdraw from them tax-free to pay for college. This is great but I did over-save (what can I say, my children are smart cookies and earned some nice scholarships!) and will have about $100K or so left over when my youngest is out of school.
These funds are now available to our kids if they want to go to grad school or for our grandkids – so not a horrible outcome.
What’s your best tip for spending less money?
I believe the best thing you can do to get yourself to spend less money is attitudinal: Am I buying this thing because I will truly enjoy it over the long term or am I trying to impress someone?
The ability to NOT try to impress other people is very valuable to your net worth!
Also, my wife and I have a “50 dollar rule” – if one of us wants to spend $50 or more on an unbudgeted item, we agree to discuss it. For anything charitable the limit is $100.
I think we need to index these to inflation since that rule is about 25 years old. . .
What is your favorite thing to spend money on/your secret splurge?
Despite being quite math-savvy – here are two calculations I will never do:
- The amount we spend on our boat (initial cost, insurance, maintenance, storage, fuel, etc) divided by the number of times we ride the boat in a given year.
- The amount we spend on our lake home (initial cost, insurance, utilities, maintenance, etc.) divided by the number of nights we spend there in a given year
Both of these numbers would be pretty outlandish – definitely in the category of “splurges!” But they are worth it for the fun, flexibility, and hospitality we get to share with our family and friends.
INVEST
What is your investment philosophy/plan?
Given my training as an actuary, I have the attitude of trying to match assets and liabilities. My assets are – what you think they are (investments, cash, land, homes, etc.)
My liabilities are anything I need to spend over and above current income. Specifically, this would be:
- Major purchases (a home, large charitable donations, etc).
- Retirement or semi-retirement when my expenses are greater than my income.
- The fact that I may die or become sick or incapacitated during my earning years.
The third item is solved through insurance (life and LTD). So my philosophy is to invest assets to match my remaining liabilities. So for instance since I am not planning on any major purchases my liabilities are not going to be realized for another 10 years or so – so my assets can be a bit on the risky side.
My philosophy in terms of how to invest is that I cannot beat the market by selecting securities/investments individually – I get a much better return on my time focusing on my income, managing the family business, etc. Therefore, my focus has been on choosing the right sectors and markets to invest in and then investing in low-cost index funds.
I like to use “robo-advisors” to help me with asset allocation – so that I am investing in the right sectors given my time horizon, etc. I used to use Financial Engines until they sold out to a financial advisory firm (it was free given that I was a big Vanguard client).
Now I’m using Empower (which runs my 401k) but it is not as good. Any suggestions on tools (that DO NOT charge you as a % of assets) that you all use would be welcomed!
What has been your best investment?
My company went public in the mid-2000s, I was awarded some options and restricted stock – so essentially I was forced to invest in this one security, which is something I would never normally do – and over the next 10-15 years the stock went about 5x.
Total luck, no skill on my part, just the Lord’s providence I guess.
What has been your worst investment?
OK, confession time: I have been way over-invested in cash in the last 10 years or so – very low returns while stocks and bonds would have been a much better investment. I have not been following my philosophy, so I guess that’s what I get!
I have been protected against downturns but have suffered a loss of potential investment gains.
What’s been your overall return?
High single digits/low double digits (per my Vanguard summary page).
How often do you monitor/review your portfolio?
About quarterly.
NET WORTH
How did you accumulate your net worth?
I guess I would point to these things as the key drivers: Having some very well-paying jobs.
As I described above, I did this by going into a profession with high barriers to entry (having to pass actuarial exams) and doing well, then showing that I could take on more responsibility by having a broad view and being independent and self-starting, supporting people in my company that were up-and-coming themselves and riding on their coattails, just plain hard work, and providence – being in the right place, with the right skills, at the right time.
Moderating spending – not going for the expensive house, the expensive car, the expensive clothes, etc. and my wife and I being of a like mind. I thank my church for training me in this too – teaching me “it is more blessed to give than to receive”, that “the meek shall inherit the earth”, and “For what does it profit a man to gain the whole world and forfeit his soul?”
That teaching cost me a Corvette but gained me a valuable and joyful perspective.
My wife’s inheritance in the form of land. I would estimate that that has added about $2+ million to our net worth.
I will stick my neck out once more and be a bit controversial – Giving. We have always given 10% or more of our income each year to our church, charities, and ministries and in most years much more than this (more later).
I posit that my net worth is higher because I give – it has caused us to look beyond ourselves to what the world is like and how to be attached to a bigger purpose. Does this help me to work harder (income) and spend more carefully (expense)?
I think so and maybe that is worth more than the 10% or more that we give each year.
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?
Definitely Earn/Save and not Invest. I have over-weighted my time to my career and under-weighted my time toward investing.
So I have un-sexy returns but have been able to put away significant savings and I feel OK with that.
What road bumps did you face along the way to becoming a millionaire and how did you handle them?
I was already a millionaire when this happened but I had a time in my career when I was let go from my employer of 22 years (but got a very nice severance package) and then I had a 10 month job search and landed in a job where I only lasted 2 years. I never fully recovered to earn the income I earned in the last job of the first employer.
That being said, the bumps were way more emotionally taxing than financially taxing. I was able to quickly get back to growing our net worth and even accelerate due to earnings from the family estate.
What are you currently doing to maintain/grow your net worth?
Well, I’m thinking I’m at or close to a “treading water” point as far as my net worth. My income has dropped substantially but I think we can still meet our annual expenses.
The family business is due to throw off some more income in one more big lump then a few smaller lumps later on but we will put about 50% of those earnings into our DAF. So at 57 I would be happy with “treading water” until about age 60 or 65 and then drawing down savings after that.
Do you have a target net worth you are trying to attain?
No – what I have now seems just fine to us. So we are just trying to keep our net worth well above 0 for the remaining years that God gives us.
I like the analogy of “I played the game, I won the game, now I’m leaving the table.”
How old were you when you made your first million and have you had any significant behavior shifts since then?
I was about 40 and had appreciated stocks/stock options in my company.
I would not say I’ve had big behavior shifts since then other than maybe allowing myself to “live a little.”
What personal habits and/or traits have you developed that have made you successful at growing your net worth?
To boil down the above: As far as work – being curious, having a big picture view, pursuing excellence, and leveraging your strengths.
In investing – don’t pay high fees, just invest in the right indices. Don’t go after out-sized gains unless you have the ability and interest to put in the time (e.g. real estate, side businesses, etc.).
In spending – you don’t need to impress anybody! In saving – be tax-savvy and diligent in saving.
What money mistakes have you made along the way that others can learn from?
Being over-invested in cash – I should have more aggressively dollar-cost-averaged.
What advice do you have for ESI Money readers on how to become wealthy?
I think of “wealthy” as more of a state of mind than a number in a ledger. Strive after “contentment” with an eternal perspective and I think you will be “wealthy”.
For me, trusting in God and His providence has given me more wealth than any of my possessions.
The Bible (1 Timothy chapter 6) says: But godliness with contentment is great gain, for we brought nothing into the world, and we cannot take anything out of the world. But if we have food and clothing, with these we will be content.
FUTURE
What are your plans for the future regarding lifestyle?
As I mentioned above, this new job will pay significantly less than my previous jobs, but I will be working in a ministry context that I’m hoping will allow me some better work/life balance, flexibility, more joy, and an overall better sense of purpose.
I’m open to where the Lord leads from here – I’d like to explore doing consulting work on a part-time basis for other non-profits once I move on from this job. The ideal would be to tone down my emphasis on employment and spend more time being a grandpa, volunteering, traveling, etc.
What are your retirement plans?
I don’t know if I will fully retire as long as I’m able to work, but I do definitely want to decrease the hours I am working and may even move toward volunteering vs. working for pay.
My wife and I enjoy traveling and experiencing other cultures, so we’d like to do more of that – both vacation and to do ministry. We are planning a trip to Europe this fall (the first time we will go together vs. me traveling for work) and would like to do more as we are able.
Are there any issues in retirement that concern you? If so, how are you planning to address them?
I guess I’m concerned that I can strike the right balance between work and leisure, and that we can maintain friendships with others.
MISCELLANEOUS
How did you learn about finances and at what age did it “click”?
I went to a great private college and needed to live on campus. My parents were not well off and once I realized what a stretch it was for them it really made me come to terms with the implications of managing my finances well.
I knew that working hard (60+ hours per week in the summer and 10+ hours per week during the school year), getting by with bare minimum spending, having an “investment” mindset, and some prayer was what was needed to get me through this time.
That, along with marrying my goal-oriented, hard-working, focused wife set me on the right path.
Who inspired you to excel in life? Who are your heroes?
My parents of course – they had a tough road financially early in life but through hard work, faith, and commitment to one another they raised the 4 of us to succeed in so many areas of our lives.
We brothers laugh about our Dad’s “admonitions” to us (You only worked 40 hours this week? You’re taking a day off? You bought what?) but he said those things in love and we are all better off for it.
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?
Yes, a few. I don’t spend a lot of time reading about personal finance nowadays, but these are some that were formative to me. They definitely come at finance from a Biblical, Christian perspective:
Money, Possessions, and Eternity by Randy Alcorn – Mr. Alcorn is more of a pastor than a financial expert, but the attitudes and actions he teaches put you in the right frame of mind to glorify God with your finances and set the right priorities.
Master Your Money by Ron Blue – a classic in the financial basics – budgeting, spending, insurance, saving, giving – from a Christian perspective.
The Things of Earth by Joe Rigney – putting forth a “middle course between idolatry on the one hand and ingratitude on the other.” Really helped me understand how to enjoy the gifts God has given me while being pulled in the direction (sometimes rightly, sometimes not) toward asceticism.
Do you give to charity? Why or why not? If you do, what percent of time/money do you give?
I thought you would never ask! If I were to create a blog (and steal all the great ideas and examples from our beloved ESI) it would be ESIG.
To me, giving is one of the main pillars of financial life. Especially at this time in my life, given the choice of “socking it away” and giving to something greater than yourself, I really want to lean toward the latter.
Here are some practical ways we do this. We have developed good relationships with many “favorite” charities.
We try to hit a variety of different areas of focus, including:
- First and foremost, our church
- Meeting basic needs – local: food shelves, other ministries addressing poverty, housing, etc.
- Meeting basic needs – global: organizations that address poverty in the third world and address global crises (e.g. natural disasters)
- Justice: Organizations addressing human rights at the beginning and end of life, rescuing victims of abuse and sex trafficking, etc.
- Educational institutions
- Missions and Evangelism
We have an annual or semi-annual “giving summit” where we decide where to allocate our gifts among existing charities and anything new. We try not to be too reactive to appeals, but rather to respond to requests for donations with “send us some materials, and we will review them when we meet next to discuss our giving priorities.”
A few years ago we were able to start two Donor Advised Funds (“DAF”). One with Vanguard and one with National Christian Foundation.
Both are great and have their own strengths and weaknesses, so instead of choosing one we did both. We opened these accounts for a few reasons.
We had some “lumpy” income and wanted to deduct as much as possible in that tax year but not have to decide immediately where to give those funds.
The charitable giving portion of our taxes was a nightmare in retrieving, finding, and tallying all the gifts we made each year. It was the hardest part of doing taxes. Now it is just two receipts each year (along with a few odds and ends outside of our DAF).
The Vanguard account allows us to seamlessly give shares of mutual funds directly to our DAF. That means we get a deduction for the fair market value of the shares but DO NOT have to pay capital gains taxes on any gains.
If you invest and give, you really should give appreciated assets!
It’s a good estate planning vehicle. When we pass, our Trust will distribute shares to the DAF and the DAF will follow our directions on where to give the money.
Overall, we give because it brings us joy! One of my favorite days of the year is when, after we have our giving summit, I direct money to these wonderful charities. It’s the one administrative task I love doing.
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?
We have an estate plan that includes a Trust that will be left to our 3 kids. The current thinking is that they will each inherit ¼ of the assets and our donor-advised fund will get ¼.
We would rather not have an “avalanche of cash” land on our kids when we pass, but we also want to pass on our wealth to future generations (especially since a material amount of our net worth was passed on to us from our parents).
Ideally, we will be able to bless our kids and grandkids while we are alive and after we pass, give away a decent portion of our net worth, yet also have enough in reserve to get any care we might need as we age. That’s the goal.
Financial Fives says
Such an inspiring story, I love how open you are to charitable gifting and volunteering, and advocating for it. We don’t hear that enough! Too many say they don’t have estate plans, and it’s worthwhile to know what is important to you and when enough is enough. The book Die with Zero would be a great addition.
You’ve got a very comfortable life ahead of you, nice work. Please continue to teach others the value of giving!
M421 says
Thank you, Financial Fives! I did recently read “Die with Zero” and found it enlightening and helpful in many ways.
I’m hoping my new job will give me good opportunities to teach the younger generation some of the lessons I’ve learned.
Eddie says
Great story! Sounds like a purposeful and rewarding life. I am about 10 years younger and have 3 kids that are 9, 11, 13 and I wish the grocery bill was $250/month. It is over $2,500. lol. But many other similarities minus the boat – fortunately my parents have a small lake house and have that covered that I share 1 or 2 weeks a year with my 5 siblings.
MI 343 says
I love your story! The comment, “For me, trusting in God and His providence has given me more wealth than any of my possessions.” puts everything in the right perspective.
I too have put my trust in Jesus Christ and experienced a life that is wonderfully blessed and know my true home in Heaven and the New Jerusalem will be even more wonderful. I expect I’ll be on Earth a while longer and will continue to live to glorify Him and finish the work He gave the me to do.
Your giving is impeccable and I agree that abundant giving along with good financial stewardship overall makes one more disciplined and opens up pathways for financial blessing that for most of us would not otherwise exist. This is what helped lift me out of the poverty I was raised in.
Blessings on your continued journey with Him and for all you do to help others through your giving of time, skills, and money!!!
M421 says
Thank you, MI 343. I love this part of the Westminster Catechism: “The chief end of man is to glorify God and to enjoy Him forever.” That is what we are aiming for more than any material wealth or other gain. Blessings on your journey as well!
MI-349 says
Thank you for sharing your story and congratulations on your many successes. I particularly appreciate what you’ve shared regarding giving. It comes from the right place and is done joyfully! Very impressive and hope it inspires others as it has me.
M421 says
Thank you, MI-349. I appreciate your encouragement. I still don’t always feel like I’m truly giving out of a right attitude and in the right way. We are all in process. Soli Deo Gloria!