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.
My questions are in bold italics and her responses follow in black.
Let’s get started…
How old are you (and spouse if applicable, plus how long you’ve been married)?
I am 42 and a long-time divorcee/mom.
Do you have kids/family (if so, how old are they)?
I have 1 child, a daughter who is 15.
What area of the country do you live in (and urban or rural)?
I live in the Bay Area metropolitan.
What is your current net worth?
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?
- Investment account: ~$1.7M
- Deferred Compensation: ~$500K
- 401K: ~$275K
- 529: ~$63K
- IRA: ~$5K
- Roth IRA: ~$20K
- Jewelry/Household: ~$7K
- Cash: ~100K
I also have another ~$950K+ in unvested restricted stock that vests over the next ~3 years.
My only liability is my auto lease which expires in 2 months.
I paid off my undergraduate school loans in my 20s, ahead of the 10-year repayment plan I had signed up for (one of the few smart money moves I made when I was young). And I paid off my graduate school loans as a lump sum 3 months after completing my degree.
I also recently sold my home.
What is your job?
Biotech — I work on the commercial side of the business.
What is your annual income?
In addition, I receive stock grants that vest at a rate of ~$400K+ annually
Tell us about your income performance over time. What was the starting salary of your first job and how did it grow from there?
I have been in the same industry my entire career, with more than half of my career in sales or sales management.
I started at ~$40K out of college, in a sales role. I was making $100K+ and in sales management by 26. And then I was earning $250K+ by 34.
Now almost 20 years after entering the professional work force I am earning (in base/bonus) 10x my starting compensation plus my equity compensation which essentially doubles my total compensation every year. I have been blessed, especially considering I am single income with no additional assistance/support.
I recently looked up my salary history on the Social Security Administration website. In 18 years of work I have earned a pinch over $6.5M in total compensation. 18% of those dollars were earned in my first 10 years of professional work and 81% of those dollars were earned in the last 8 years of my professional work.
I have bigger expectations for the last 3-8 years of professional work but also wouldn’t be overly disappointed if my total compensation stayed flat.
What tips do you have for others who want to grow their income?
I say go hard when you are young and have endless energy; put in the hours and make sacrifices early. Chase your career like nobody’s business.
In business, breadth and depth are both good strategies but there is some value to building a strong cross-functional/cross-experiential resume in my opinion.
Be willing to pick up and relocate for opportunities to grow your career; this gives you a competitive advantage versus other candidates. I have learned you can settle down later once “you’ve made it” by your standards as there will come a point will you no longer be willing to move for a company and that point is usually when you are in the zone of your number or your kid’s school becomes a decision maker.
I also believe great financial value can come from choosing to work in a high-paying industries. I also think sales careers can be highly lucrative in terms of one being able to influence their variable income (merit compensation and bonuses).
And finally, I wholeheartedly believe in working for companies that offer equity as a part of the total compensation as that choice can make you wealthy over time; as I stated, I literally double and have up to tripled by base and bonus compensation, every year through equity.
What’s your work-life balance look like?
My friends and family would tell you it is not good…but it’s all relative to their own point of reference. Relative to my past when I was at work in the 5 am hour and not done working until 9 pm…and then worked all weekend…I have improved greatly.
I would tell you no dollar I make comes easy…but it is worth it to me because I will be retiring at 50, if not before.
By personal choice, my work life balance has improved dramatically over the last couple years. I do not travel at all for work and say “no” to almost any request to travel for a meeting, etc. And I generally do not work evenings expect maybe 1-2 evenings a week for a couple hours. I also generally no longer work at all on weekends. Where they get me is I am in the office by 7 and leave around 6 each day.
I believe the more money I have accumulated, the more free I have begun to feel and the less sacrifices I have been willing to make. Money and freedom are funny in that way. I feel much more in control of my work life balance today than in the past.
I also vacation very frequently. I spend no less than 5 days a quarter at the beach — in the Caribbean, Hawaii or Mexico. I’d like to vacation every 2 months truth be told! Regardless, by my definition, I am “living” more than most people. The 85 days in between each vacation are the toughest! 🙂
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?
No. I am well compensated and it feels that most anything I would want to or could do doesn’t calculate out as being worth my time relative to what I am used to being paid.
And honestly I am not too inspired to work much more than I do already. As I mentioned, I am finding that I am running out of energy for work (and hence why going hard when you are young is best).
The idea of a “side hustle” has not won me over yet. Until I have capacity to take on more or can come up with a hustle that brings in significant income I am just not that interested. If I could identify one where I could make substantive or meaningful income, I may be more enticed. I am certainly open to ideas that could create sustainable income after retirement.
What is your annual spending?
I spend ~$150K annually, maybe a little less but definitely not more.
What are the main categories (expenses) this spending breaks into?
My annual expenses (outside of payroll taxes) are as follows:
My #1 expense is SAVINGS. Annually, I save ~$400K+ in equity (less taxes) and then ~$198K from other compensation including $18,500 in 401K (and $10K in matching), $21,500 in ESPP, 28% of my base in Deferred Comp and 75% of bonus in deferred compensation.
All-in-all I save ~ 70% of my total compensation each year. As a female single parent earner with no assistance, I could not be more proud of my discipline around ensuring my and my child’s future.
Other annual expenses after Savings:
- Rent ~$60K (I live in California! I love it as much as I hate it for all the reasons you can assume!)
- General cost of living expenses such as utilities, car note/gas, insurance, discretionary spend, etc. $70K
- Vacation $20K
- Additional Taxes due Fed/State each year ~20K+ (comes out of my portfolio)
- Financial Advisor/Wealth Management fees $20K (comes out of my portfolio)
Do you have a budget? If so, how do you implement it?
I do not follow a budget. I do have the Mint and Personal Capital apps which call me out when my expenses are unusually high, so they keep me alert.
I feel I am living so tight and conservative already I cannot further punish myself with a detailed budget (even though I do know what I spend on every main expense category per month).
My main money management mechanism is to pay myself first, so ALL of my savings is done (put to the side and invested) BEFORE my money hits my account…this means I can only spend what is left.
So essentially my budget management is to spend only what I have (and simultaneously) avoid credit cards. I tend to only get behind on my credit card 1-2x a year otherwise I pay my balance off monthly.
What percentage of your gross income do you save and how has that changed over time?
From age 23-33 I saved some amount diligently in my 401K (but did not necessarily max it out), and then over and over again would take out 401K loans for big expenses; essentially I was never able to accumulate a healthy principle. I literally had $0 in savings at age 33.
From age 34 onward I have been maxing out my 401K, maxing out my ESPP options, saving my employer stock and pushing up my savings each year into a mix of taxable and non-taxable accounts.
When I became eligible to participate in my employer’s deferred compensation plan that helped me further expedite my savings and minimize my taxes. For the last 3 years I have gradually pushed up my savings from 60- 72% of my total compensation. And I have accumulated my entire net worth in the most recent 8.5 years.
The power of savings, investing and compounding is unreal.
What is your favorite thing to spend money on/your secret splurge?
Vacation is my big splurge. I take a vacation every 3 months and I like to stay at really nice hotels across the Mexico, Caribbean and Hawaii islands. I refuse to short myself on vacation time or accommodations.
Beyond this, my secret splurge… is that I truly enjoy pushing more and more to savings each year; watching my money stack up and grow so quickly is so motivating and really keeps me inspired to keep stacking cash and living paycheck to paycheck.
What is your investment philosophy/plan?
I follow JL Collins and the Bogleheads and would like to get there on self-implementing their simple investment philosophies…but the truth is I currently outsource the management of my portfolio simply because I do not yet feel equipped. I made the decision to outsource once I realized I had accumulated $1M in savings (it just seemed bigger than me and my random choices at that point).
The drivers of my decision were as follows:
- The management of my equity (RSU, ESPPs, options, etc.) and when to hold or sell is something I prefer have professional advisory for
- Strategic tax minimization advisory is important to me as a high earner and I get that from outsourcing
- I also leverage outsourcing to ensure I am deploying all of my savings into appropriate venues as I plan to retire early and need to ensure my money strategically deployed to get me through each decade, i.e. taxable and non-taxable venues
- Finally, as my portfolio grows larger I just feel more comfortable with an educated professional overseeing it vs myself
My wealth management firm had me at a 60/40 allocation for the first couple years but I insisted we move to a 75/25 allocation last year so I could reap better returns. They drive my portfolio overall but I am a very engaged passenger seat driver who at times is directive with them on what I want based on what I learn and believe. I have a call with my money management team at least every quarter and sometimes more frequently; they are “on-call” for any and every issue/question or any analysis I want. The truly appreciate their level of service and it is hard to walk away from this.
My firm charges 1% on the first $1M, 0.75% on the next $1-2M and 0.5% on $2M+…so they are more efficient as my money grows (though still expensive when I look at what I am paying annually). At the end of the day, I think I’d lose more self-managing than they are costing me, so that is how I justify this strategy and expense.
What has been your best investment?
I wish I could brag here about my investments in Amazon or Facebook or some other tech winner…but I have never bought individual stocks.
I assume I’d say I have had my best luck in selling primary residence real estate. I have owned many homes and at least 3 of them I have done really, really well within a very short amount of time (+50K-200K in 24 months). The idea that you shouldn’t buy a house unless you are going to hold it for 5+ years is simply not true for me. I have made great money on homes that I have held well less than 5 years each. These large chunks of money from real estate sales are my best investment.
Beyond this, my best investment has been just having had the opportunity to earn equity from my employer; it is like free money that has doubled to tripled my income every year which has expedited my wealth accumulation.
What has been your worst investment?
My worst investment has been leasing cars multiple times in my adult life. My current lease is about to end and I am finally about to buy my first used car, at 42; I look forward to not having a car payment after this. I could have paid for 2+ cars outright by now with all of the money I have wasted on leases.
Another funny bad investment was when I paid my MBA school loans off as a lump sum and thought I was doing good. They were private loans at 6-7% and totaled about $60K with a really high monthly payment so paying them off in short order after I completed my program felt great! The truth is I sold some of my employer stock to pay the balance of the bill off and then my stock value tripled over the next year or so, so really I lost big (to the tune of 120K!) paying off my school loans! But who would have predicted that?! Only in hindsight can I say that paying off my schools loans, when I did, was a bad investment.
What’s been your overall return?
Well again, from ages 23-37, I was randomly selecting investments (eeny, meeny, miny, mo…) and not paying much attention to my returns outside of quarter to quarter when statements would arrive.
It wasn’t until I randomly and surprisedly reached $1M in savings that I truly decided it made sense to pay attention. At that point I hired a professional and I have been with them 3+ years now. So only since I have been with them have I been paying attention to my annual returns.
Last year was my best year (since I have been paying attention) at 14% overall. I realize many people made closer to 20% + in 2017 but wealth preservation is as important as wealth accumulation to me and thus my portfolio is a bit more conservative than many other people I assume; I also have a low risk tolerance with money as I do not come from it. 20%+ returns would have been much more exciting but managing risk is a big priority for me so I am fine with what I earned.
I was particularly shocked to see that my money made $253K last year of which $56K was from dividends across my portfolio. If I can “earn this while I sleep” each year then this is a win in my eyes! As my principle grows my interest and dividend earnings will only get bigger. I can actually see that in the future my investments will be able to fully replace my base and bonus compensation which is potentially very exciting!
How often do you monitor/review your portfolio?
I am overly engaged now and check my portfolio and the market every/other day. This was very fun in 2017 and much less fun in 2018. I also use Mint and Personal Capital as inputs to update my Net Worth (Wealth+) app weekly. This type of close oversight keeps me very engaged in my expenses and accumulation and thus keeps me from being frivolous with my money.
Importantly I also do quarterly reviews with my wealth management team where we look at my portfolio performance, returns, rebalancing opportunities, expenses, fees, etc. and talk about ways to further optimize my portfolio and maximize my returns. I also send them questions in between reviews if I need immediate responses, insight or analysis to make time sensitive decisions. Less urgent requests are responded to in my quarterly reviews.
How did you accumulate your net worth?
I am in a high paying industry and have had a strong career trajectory which has allowed me to propel my earnings over time significantly. As mentioned I am making 10x what I started out at coming out of college if you include base/bonus and 20x what I started out at if you include base, bonus and equity.
I accumulated my net worth, beginning at age 34 through very aggressive savings of my total compensation and through employer stock (which is awarded based on high performance). Big picture- I have been lucky (right place, right time), blessed (thank you!) and disciplined in my finances….and these I attribute my net worth accumulation.
What road bumps did you face along the way to becoming a millionaire and how did you handle them?
I have mentioned many of my bumps already.
Being downsized once in my career was probably the most notable. That moment in time taught me that I never wanted to be caught without enough emergency savings again. I do not buy the have 3-6 months money on hand guidance; I say everyone needs enough money to cover 1 year of expenses on-hand for emergencies. Being out of work can literally set you back for years if you don’t have enough cash to float yourself. My response is best seen in my savings rate today and in how I ensure my taxable and non-taxable accounts are leveraged to ensure liquidity as needed.
The other bumps are the market volatility that have affected my portfolio that drive me crazy…luckily I am here for the ride and trust that the volatility is necessary to get to the desired end game. Many times I have seen my portfolio lose 100K in a day and then it takes me 4-6 weeks or more to get back to that original point.
Watching my portfolio get back to a previous high point is like watching the scale — but flipped. I can gain 20 pounds in a month and it takes me 3-4 months to lose it. With my portfolio, I can hit a high and then a huge drop comes…and then I have to contribute and contribute and contribute and wait for the market to come back just to get back to a previous high point. That is so emotionally and mentally frustrating. Luckily all of my reading in the FI/FIRE community has taught me to 1- buy on sale, 2- ride the waves out, 3- don’t ever jump off of a roller coaster and 4- it is never the peak!
What are you currently doing to maintain/grow your net worth?
As mentioned, my goal is equal parts wealth preservation and wealth accumulation as I want to retire within 3-8 years (TBD) so both are important to achieving that goal.
Allocations: I have leveraged bonds as a minority % of my portfolio to ensure maintenance/protection of my net worth. As a percent of my portfolio they have ranged from 40% which I felt was too high to 25% now which feels more right; this still gives us room to buy into equities if the market dips. For growth I stay heavily allocated toward equities which have ranged from 60% to now 75% in ETFs.
To grow my net worth, I continue to push my savings rate, and thus the amount I am investing, each year. And though it is getting difficult now to save much more than I do, what I do do is push up my savings at the rate of my raise, i.e. last year I got 6% so I raised my savings by 6%.
Beyond this, I monitor my investments to ensure proper diversity and balance in my portfolio- so I can reap the benefits of the upside of any sector- and also protect myself on the downside. I advise my wealth management team when things look off for me (the guidance on the PC app helps me monitor this). I also have them share all expenses with me so I can advise on if/when they are not investing my dollars as efficiently as I’d like.
Do you have a target net worth you are trying to attain?
$7M is my magic number; I’d like to hit it by 50. I believe this is almost do-able with my savings rate and time window (I might fall just short though). Of course a market turn could flip my whole plan upside down.
In the short term, I plan to hit 3.1M by Q1 19 through aggressive savings, portfolio earnings and stock vestings. Crossing $3M feels like a good milestone for me. Once I hit that I feel like it’s all about letting time doing its’ thing at that point. For sure I will hit 5-6M by 50 which ae still comfortable numbers in my book.
In my case age is a more important number than my financial number. At 50, I am done no matter what is in my bank account. That is my promise to myself.
How old were you when you made your first million and have you had any significant behavior shifts since then?
I hit my first million at 38, after starting at $0 at age 33 (because I was blowing every dollar until then). Hitting it was unexpected and seems unbelievable to me…a blessing for sure. I sure wish I had started saving intently 10 years earlier as I’d be done working by now.
The sad thing about hitting my 1st million was that I really didn’t celebrate it… I was more so shocked and worried about losing it and got busy trying to find someone to manage it. Same thing with the 2nd million…I just sort of missed it being heads down busy with earning and saving. I WILL celebrate when I hit $3M!!!
The main behavior change once I hit the number was that saving more became easier. It is JUST like weight loss…when you have lost 20 pounds you are motivated to get to 40 pounds, but when you have only lost 2 pounds it hard and less motivating to keep going because the goal seems so far away. Same thing with money. When you have 100K it feels like you will never get to 1M. But when you get to 1M you can see that you can easily get to 2M with a little extra effort.
I hit 1M at 38 and then 2M at 40/41 and then I will hit 3M at/by 43…and so on…to 5M/6M/7M and beyond. It is certainly easier to stay diligent when you can predict and project out the fruition of goals.
If you could rewind to when you first started out, what would you do differently?
From age 23-33 I did save diligently in my 401K (but did not necessarily max it out) and then would take out 401K loans for big expenses or to pay off bills; essentially I was never able to accumulate any substantive principle. Those early withdrawal or loan penalties seemed like nothing at the time.
It was such a miss to not understand savings and compounding early on. Time is the most important thing in the context of money and I lost or blew 10 years of time and money. I can only imagine what good financial shape I’d be in if I had used those 10 years wisely.
I’d also avoid credit cards- and cash advances and high interest rates, etc. like the plague if I could go back; they really drug me down and kept me down for longer than I should have let them. I clearly had spending and discipline issues as I always made good money and for some reason it was never enough. Now I only use credit cards for big purchases so I can get my points and then I pay the balance off pretty much immediately.
What money mistakes have you made along the way that others can learn from?
I always made a good income when I was younger but also always struggled with overleveraging myself with credit. Paying off credit balances seemed like a continuous cycle for me in the first 10 years post-college. That definitely inhibited my ability to maximally save and invest.
Also again, not starting (saving and investing) earlier was a big fail. If I had just maxed out my 401K for the first 10 years and saved a little something outside of that I’d have another million dollars at a minimum. As they say…time waits for no one.
If you had to give advice to ESI Money readers about how to become wealthy, what would it be?
Well this site (which is my favorite PF site!) and those like it are a great start!
- Ask people how they did and are doing it…take notes and listen! I ask my tax guy every year…what are people with more money than me doing to manage their finances…what are they focused on to growth their wealth and protect their money? No matter what amount you have there are people doing better that you can learn from. Be curious! Ask questions! I personally carry the profiles for Millionaires 18 and 27 in my purse every day and I have a side by side analysis of what they did to get there vs what I am doing so I can clearly see my opportunities…these multi-millionaires are on pathways that I want to follow and I revisit their “how” vs “my how” frequently…and then I tweak and reengage in my plan because they motivate me!
- Read-read-read and apply-apply-apply.
- The best book I ever read…and the one I say follow is “The Richest Man in Babylon.” And then “The Automatic Millionaire” is also a must read/must apply book. I am also a fan of “The Aspirational Advisor” and “The Simple Path to Wealth.” Read these and then focus on application.
- Start early-But if you missed that window…then start late!!! Automate your savings- save consistently- keep pushing up your savings rate- and invest, invest, invest. These to me are the secrets. Oh yes…and pick the right field…and then hustle…and hustle harder!
- Teach your kids about money because if you don’t, who will? There is no reason we should leave “life” to be our kid’s teacher of money when we are so educated as a group; we MUST pass the education on. My daughter and I have very open discussion about money. She knows how much we have, how it will grow when the rule of 72 applies to it across time and how she is supposed to treat and manage the money when she has a family, i.e. contribute to it, live off a part of the interest and pass it on to her children.
What are your retirement plans?
I plan to retire somewhere between the age of 45 and 50 (the sooner the better!) but I probably won’t feel comfortable leaving the workforce until I have ~$5M in the bank. I plan on relocating to Mexico or the Caribbean full time and will buy a family house that I can leave to my daughter and her future family. I have not decided what I will do in terms of work when I get there but I can promise you it won’t be much. 🙂
For sure I will take the first year off to rest and rejuvenate and “figure the future out.”
I plan to live off 4% of my interest/earnings annually so I can leave my daughter my entire continually growing principle. I assume with me spending $150K annually now I can get away with $125k annually in retirement especially considering I will not be giving away $60K in rent like I am in California. I almost have 25x my expenses saved so I am in the “window of freedom.”
Are there any issues in retirement that concern you? If so, how are you planning to address them?
The cost of healthcare is my biggest concern. And being that I plan to leave the US, the quality of healthcare is my #2 concern. Beyond this — EVERYONE I know that has retired early is so happy so I think there are so many more things to look forward too than worry about.
How did you learn about finances and at what age did it ‘click’? Was it from family, books, forced to learn as wealth grew, etc.?
When I was growing up my mom and dad argued about money all the time; it is my most vivid childhood memory.
Without getting into all the details — I made strong connections between money and stress. And I carried this thinking on through my 20s.
My mom was an over-spender and lacked discipline. My dad had strong money management fundamentals but could not get anywhere because of my mom.
When I finally stumbled upon an accumulation of money, I was able to see money as power and control vs stress and as someone once called it, “freedom units.” I have appreciated the opportunity to apply everything I ever heard my dad try to teach us about money. Oddly, what he was saying about money never clicked for me until I had some. I guess it has to do with things seeming impossible, until they are not.
Who inspired you to excel in life? Who are your heroes?
I learned so much from my dad; he would have been rich — if he had money. 🙂
I also had a fortunate opportunity out of college, to be hired by, work with and be mentored by 2 very independent women who talked about and advised me about wealth creation and management very frequently; they talked the talk and walked the walk.
They taught me about saving for a rainy day, being self-sufficient, and they showed me that women could be self-made millionaires with or without a man. Like my dad talking — I heard everything they said, I just didn’t apply these things until years later. It is worth noting that to this day they both take great pride in my progress as they know they were a big part of it.
Do you give to charity? Why or why not? If you do, what percent of time/money do you give?
Yes, but I could and should do much more. What I give is minimal compared to what I bring in. As a single mom my #1 goal is ensuring my daughter’s secure future so I put most everything around that objective first.
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?
Absolutely. I plan to leave my daughter my entire principle. My goal is to live simple once I retire and leave her everything…the money and a family vacation house. The reality of coming from not much and passing on generational wealth is a huge life goal and top priority for me.
What I really want is for my daughter to have choices in life and wealth enables that. I desire for my sacrifices to be my daughter’s and her family’s freedom.
I also desire that the way I live be an example to her for how she should set up her children and that she then teach them the same.
As a woman and a member of an underrepresented and under-resourced community, I am thankful for the opportunity and carry the task of re-pathing my family onto a new trajectory. In return I expect my daughter to keep our family on an upward trajectory so that the generations ahead of us get a head start and do better than each generation before.
Waahh how inspirational *_*!!! Holy moly 20x in 18 years O_O!
“Reality of not coming from much and passing on generational wealth is a huge life goal and top priority for me.”
“I can gain 20 pounds in a month and it takes me 3-4 months to lose it.”
Yes!!! 100% to both statements, couldn’t have said it better myself.
Accidental FIRE says
I say go hard when you are young and have endless energy; put in the hours and make sacrifices early.
I agree with this and it was my strategy to financial independence. I call it “front loading” your career. I worked extremely hard in my 20’s and early 30’s but to be honest I didn’t feel it was too much of a sacrifice. I enjoyed what I did and still made time for vacations etc. Actually vacations just recharged me and allowed me to keep the intensity high.
Absolutely! (A lesson we must pass on to the next gen!)
No one told me I’d begin to run out of steam in my 40s! I wish I would have went even harder earlier.
I think being a mom and managing everything solo for all these years takes it toll.
I love vacation for rest and rejuvenation and just the nothingness though I always seem to work straight through my vacation (though working from a beach doesn’t bother me too much!). Unfortunately the “feeling of vacation” quickly disappears by about 3 pm my first day back and I found myself counting down to the next vacation almost immediately. That’s how I know I only have a few more years in me.
My hope is that when my daughter goes to college in a few years that I find my second wind.
Congrats on such a great career and savings accomplishments. I find it interesting you are set to retire no later than 8 years. I am only slightly older than you, and I worry at times if I can downshift from 40+ hours a week to zero. I don’t feel like I’m missing out on things because of working. I vacation a good bit, and spend only about an hour in the car per week so it leaves a lot of non-working time for recreation. Also as my kids get older, they take much less of our time even though as a parent you always want as much as you get. Have you any concerns in this area?
Hi Chris/ thanks for your note.
Oh wow…I wish I had more in me but it’s getting tough! I can absolutely imagine doing NOTHING for 40 hours a week… at least for a year. It is certainly possible boredom will kick in… but I’m almost at the peak of tired right now so it’s hard to think a next life of nothingness wouldn’t be anything but great. So… NO CONCERNS;)
A sabbatical would be such a great option and I am actually considering one now.
You are right… the kids take less and less effort as they age but it’s still 24-7 monitoring and my focus around ensuring her ability to be independent and self sufficient takes a lot of coaching time. My hope is that I find my second wind when my daughter goes to college.
Regardless. (My story for now and I am sticking to it…) I am done with full time corporate America at or by 50 and will be on to my next life… in the Caribbean…. now whatever that entails is TBD!;)
Inspiring interview from an independent woman, well done! We read so many more examples of successful men so it’s definitely refreshing to hear it from a woman’s perspective and it drives me to stay the course and not give up (although I’m married, which definitely helps). I wish we made as much as you, that would definitely fast track our FI – may in a few years! I love these millionaire interviews, btw, please keep em’ coming, ESI!
Would LOVE to have more!! At this point I simply take volunteers, so hopefully more millionaire women will offer to share here.
I agree!!!! I wanted to post because I know we want to see more women in the club! We are out here!!! (I think we are just busy hustling… it took me a year to get this off of my to- do list!)
Good luck – for sure the dual income will help you achieve your goals.
And the Millionaire profiles I have read for the last many years are proof it’s not what you make but what you do with it! A high income can just get you there sooner.
Wishing you and your hubby best of luck in your journey to your goal!
One of my favorites in a long time. Very similar in many ways to my situation, although also very different. But you have encouraged me to up my savings rate. I never spend equity, although I sell my company stock even with its impressive performance, I don’t want to have my income and savings from one company. I have spent bonuses on fixing up the house or a new house. We live in the same area probably, very close based on your field and I have two properties one very large. I try not to expect too much as I worry real estate. I need to start investing/saving more of my bonus.
I agree on your statement of passion on generational wealth really hits home. I also came from very little and feel right now that I’m working to ensure my children have opportunities in life. If I was single and without kids I could retire now.
Also really highlights something I have mentioned before, Earning is huge! Your examples of how much those later in life dollars add up is exactly where I am. Keep your expenses low or at least moderate and save all that excess.
A question – Why so much in deferred compensation? What do you see as the advantages? I worry to much about leaving it with my company and don’t do any deffered comp. Am I missing something?
Yes we are peas in a pod it sounds!
Re- deferred comp, yes people have mixed views on this savings venue. For me it is a couple things. 1- I’m in California where 50%+ of my income is taken away in Federal and State taxes so it’s a tax minimization strategy. 2- I just need money taken away from me before I touch it…. I’m as good a spender (think back to my early years) as a saver so the way I stay the path is by ensuring as little money as possible passes through my fingers.
My company is healthy… I don’t worry about a crash here (I know the Enron people probably said his too!!!). I also set everything to potentially expire/vest for early retirement (which means I will lose the tax benefit in the end but I deferred it in the spirt of maximal accumulation on a large base)…. long story short, I didn’t see it as long term… I set it when I signed up to receive the cash out in 7-10 years which is about he time I plan to exit to my next move. Deferring all of the Fed and CA taxes in the meanwhile and letting ALL of my money grow as much as possible was the goal.
A Millionaire Next Door says
Excellent interview! All great tips and advice. Beyond the normal financial advice like paying yourself first, one of the most important tips in the interview is go hard at your career when you are young and have endless energy. This point is not stressed and emphasized enough. I am 47 with net worth near $4M. I look back at age 25 to 40, I worked (and traveled for work) at a dizzying pace. I always made time for my kids but burned the candle at both ends. I am grateful I did in order to maximize my income and savings as you cannot go back in time, no do-overs in life. Today, my teenage kids have opportunities with education and travel that make it all worth it, plus early retirement soon. Well done! Almost time for you to exhale……
Oh- that made my day!!! My path is the same as yours…with my last many years including multiple physical moves, multiple cities, a mix of home office and 100% travel roles all in my past journey. Being further down the road by just a few years and w $4M…you are inspiration for me…I am right behind you! Sending me that exhale was just perfect!
Feisty FIRE says
Excellent Interview, Congratulations on your accomplishment! Couple of questions:
1) Do you see a correlation between job stress and breakdown of relationships?
Longer hours = more arguments with spouse = less time to focus on career?
2) Are you a outlier in your industry or your peers are making around the same income?
Which are the top 3 industries for sales in your opinion?
1- Absolutely. But I think a great partner can help one manage this. A weak partner can make it even harder to handle. As for me- I found great challenge in managing a demanding career and being married. I believe this is because I had a husband vs. a partner. Having a partner can be so positive. As they say- and I believe it is true- finding a great partner is a key career decision.
2- I am a high performer and have received higher merit % and more stock grants as a result of my high performance. But I am in a high paying industry more generally. I may have peers that make less then me and some, namely men, make more.
Top 3 sales industries in my opinion:
-Biotech- Oncology is a hot area but any specialty area is good
-Consulting project sales
I have also heard that aviation is high paying
My perspective is limited to my exposure (which is generally healthcare) and thus is very biased. You might ask a sampling of recruiters for better information on a list of highest paying sales areas.
I also feel strongly that California companies pay so much more aggressively in terms of granting equity so I would be biased and only work for a CA company due to this. The competition for talent is very tight and getting people to move her is so hard and it makes the packages so much more competitive as a result. I think the move here is tough but it is worth it for the highest performers.
Just my perspective…
Feisty FIRE says
Thanks for your detailed response. I’m in Technology Consulting Sales with net income including commissions around $215K , age 30 and based in the East Coast region. I feel I’ve hit a ceiling when it comes to commissions. Currently evaluating technology software firms since technology consulting is getting increasingly competitive.
-Your point in equity was informative! Is that something you negotiate from time to time with your employer or did you discuss prior to joining the firm?
– I’m familiar with the Biotech industry and hence it rung a bell. I have a client – top15 Biotech firm based out of CT that used to give us a blank cheque book for tech. consulting initiatives . Loved working for them. The business folks were pulling in upwards of $500K but attrition, politics was too high for anyone’s comfort.
You might find MillionaireInterview73 (being released next Friday) interesting then Feisty FIRE as I am a technology consultant (although not in sales) but could provide you a different thought.
I will let M73 speak to tech sales incomes, it sounds like they are more informed. In the Bay I will say the tech people do well- tech, biotech…any tech, relatively speaking. But it is costly here- way more so than NJ and we have to suck it up.
Re: your point in equity was informative! Is that something you negotiate from time to time with your employer or did you discuss prior to joining the firm?
I think you have to choose a company that believes in equity compensation as a key driver of performance and ownership. And in the Bay- companies really need to provide equity to compete for talent in tech as the market is so healthy people have their pick of jobs. This is why I believe CA based companies are good to work for- the philosophy may be more progressive around offering equity. And then then when they also throw more stock at high performers it makes it even more lucrative to be here.
You have to scale the incomes. CA is MUCH more expensive than NJ. You may be doing as well as I am at 415K just from a cost of living and taxes consideration standpoint. If you want the equity- you may need to look at NYC and SF or other West Coast based companies for above average distributions.grants.
Good luck to you! You are still young, on this site and a hustler looking for solutions…I trust you will figure this out!
Here is my article since we talked about it above
This was excellent and loved so many things about it. As someone who has read all of the 70 Millionaire Interview (and my story will be coming in #73) 🙂 it always amazes me how much is new in each one yet how much is the same with some of the core fundamentals.
Really enjoyed hearing from an independent successful woman and her journey as that seems to be less represented in these article (not ESI’s fault).
Can’t recommend these articles enough as not one goes by that I dont learn something from or get positive reinforcement of something I am already doing.
I completely agree! I learn from EVERY profile! Though there are standard best practices, the paths to wealth are many! Like I said, I have literally done a side-by-side analysis of a few of the “more wealthy then me profiles” to see where we are different in our practices and approach and where I can identify opportunities that can help me grow and enhance by position.
I am proud to be a woman in this group and look forward to seeing more.
I look forward to reading your profile to see what I can learn!
Congratulations and great story.. I imagine the Ex is kicking himself for letting you get away… lol
Hilarious! Hindsight is 20-20!
As for me I keep my eyes straight ahead vs looking back…and I look forward to my next life where I plan to find time for a relationship so I can enjoy what I have worked so hard for, with someone special:)
One trend I keep seeing is that these people have significantly more in their brokerage account than in their tax advantaged (ira, 401k) accounts.
I am the other way around because after maxing out 401k and IRA I dont have the room to put much into the brokerage. (I’m almost eligible for an interview as well)
would like to hear from others how they got such a large amount in their brokerage account vs retirement accounts.
If one wants to early retire they have to build outside of the 401K so they can access money while younger, i.e. before 59.5
I have maxed out my 401K the last 8 years as a foundation but did all of the rest of my savings a brokerage account after that was maxed out. The tax benefits and corporate match make the 401K a great venue but it is capped at $18,500 and maybe higher for age 50+. The ultimate goal is to push beyond this savings threshold and save even more as a secondary priority outside of the 401K and in the brokerage account. That does take a commitment to push your savings up.
If you are almost a millionaire on a 401K alone- good for you! I would have had to max out my 401K for the first 10 years of work to have achieved a million dollars there alone. I guess you have an IRA as well. Again- I fund these after brokerage due to the age requirements for selling.
You will be set for a traditional retirement. You may need to shift your mix if you want to retire early/young.
Yes to all of the above!
An IRA and 401k are great later on but not going to help at 50
JeffB M20 says
Since we are maxed out at 18K/24.5K, it is easier to put more into the brokerage account once you hit critical mass and save more than you spend. We put about $18K a month into our brokerage account on average and only $4K a month into the 401Ks.
Exactly. This excellent! You are on a very good path forward! I wish you the best in achieving your objectives…though I think you will get there on that plan without my wishes!
JeffB M20 says
I have 745 days left working in the corporate world. Not that I am counting.
I love it!!!! Counting down! #jealous
I love it! Consider me jealous. Well done!
Lisa R. says
This is precisely my situation – while I passed the $1M mark several years ago, I only passed in investable assets in June, 2017 (excluding house, car, antiques, checking/savings, HSA, etc). Unfortunately for me, $1.04M of my investments are in retirement accounts, $225k in taxable accounts. If I pulled the plug today a few months shy of 51, I’d still need some kind of salary to get me to 591/2, as I have no interest in rule of 72T. My Roth IRA’s basis is only $66k, so not much help there either.
I recognize I am very fortunate to have this problem, especially as a single female.
Congratulations to you. You are well ahead of most women…you should be proud. I see your dilemma and wish you luck with this. if you figured out how to get where you are I trust you will figure out how to make up the gap.
Maybe creating passive income is the key for you to fill the gap…there are lots of good ideas around that on the ESI Money site and other FI sites. We work so hard…would be great to our money working harder for us!
I would like to enhance this part of my portfolio as well.
Molly K says
Lisa, couldn’t you access your 401K funds early by doing a SEPP 72(t), a Roth Conversion Ladder, or just taking the 10% penalty? Perhaps there is hope for you to retire early?
I just learned about this and have since overhauled my investing strategy. I was originally contribution just 6% to a Roth 401K to take advantage of employer matching, while putting the rest in taxable index funds because I didn’t want my money to be “locked away until I’m 60”. But now I’m putting 18% in a traditional 401K (maxing out at $18,500) and still putting the rest in taxable index funds.
I’m 28, so I only lost 5 earning years of maxing out my 401K, but the graphs and calculations in this article really opened my eyes.
Lisa Reyes says
Molly K –
Kudos to you; you are off to a great start! I had mentioned above I wasn’t interested in 72T mainly because I don’t want to draw down my retirement accounts yet. I could stop max funding my 401k ($24k), but that would increase my taxable income. You won’t have this taxable/deferred/tax free problem though! You have inspired me to continue looking for alternate solutions. Keep up the great work on your way to financial independence, and hoping we’ll be reading your Millionaire story soon.
Paper Tiger (aka MI 27) says
“I personally carry the profiles for Millionaires 18 and 27 in my purse every day and I have a side by side analysis of what they did to get there vs what I am doing so I can clearly see my opportunities…these multi-millionaires are on pathways that I want to follow and I revisit their “how” vs “my how” frequently…and then I tweak and re-engage in my plan because they motivate me!”
MI 70, you made my day! When I did my interview as MI 27, I hoped maybe one or two people would be motivated and encouraged by my financial path. There is no substitute for helping others and I’m humbled that you would carry my story with you and refer back to it from time to time.
I will tell you that I was also very encouraged by your story and congratulate you on how well you have done for yourself and your daughter. You and I share many similarities as we both have made our careers in the medical field as sales leaders. You offer everyone great advice and insights and I’m sure your story is going to be very motivating to many. I think your plans to achieve 7M net worth by 50 are well within your reach. With your current NW, plus the options that will vest over the next 3 years, you really only have to continue to raise your NW about 9% per year, on average, to meet your target. I have no doubt you will succeed and ease yourself right into a more relaxed, beach-oriented lifestyle.
I am 60 and continue to chase opportunity. Our only daughter is in college now so I’m free to put a lot into the next 5 years or until my wife is ready for us both to hang it up and start to enjoy our lives in a more relaxing manner. Like you, my motivation is generational wealth and leaving my daughter on a solid foundation so that the next branch in our family tree really takes off. My legacy is to give my generations that follow, a boost that can be sustainable and growing for many decades to come.
As you know from my story, three years ago I partnered with some former colleagues and started a healthcare software/services business. We just formed a JV with a much larger company and are about to raise funds for our Series A. It was initially a tough road but now things are turning in our favor and the business is about to become real. As luck would have it, I’ve been approached by another healthcare company to potentially run their global sales team. I’m waiting to see the offer but from what they have shared so far, it may be very tempting to jump back into another corporate role. I do worry a bit about my energy level and the travel that could be involved but I am going to have to deal with that in either situation. I think this could be the last leg of my career that really puts me where I’d like to be before calling it quits for good.
Anyway, thank you so much for your story and for honoring me with a mention in it. Like I said, you really made my day and provided additional motivation for me as well. Best of luck to you and your daughter; YOU GOT THIS!
It made my day to hear from you!!! So awesome!!!! And I am definitely that one person (and I am sure there were may others) that you inspired!!!
I sure hope I find your energy as I search for my 2nd and 3rd wind! I envy your drive to succeed beyond financials- you are already there!!!
Thanks for the 9% guidance…now you are going t have me trying to figure out how and where I can find that number to put aside additionally! Brilliant motivator- AGAIN!!!
I love what you are doing for your daughter- I am with you!
And congrats on your new venture…and your potentially newer venture!!! I am rooting for you and right behind you!
I will likely follow up with some additional questions on your profile now that I have your attention here…there is so much I could learn from you but I am in transit and cannot pull out my side by side right now.
I look forward to a few follow ups!
Paper Tiger (aka MI 27) says
Happy to connect anytime. Hopefully, most of your 9% can come from your appreciating assets and then the rest from the additional savings you add to it each year. If you could average about 7% per year in growth from existing assets, you should be just fine.
The second and third wind comes when you realize you can now do what you want to do and not what you have to do. That is what got me involved in startups. The financial freedom you have achieved gives you this luxury to decide.
Either way, you have a solid plan that should set you and your daughter up very nicely! I look forward to the follow-ups as well.
Hello MI 70,
Glad to read another interview from a woman & from an underrepresented group (I’m the same profile & it’s what prompted me to volunteer for an upcoming interview as well).
Wonderful to read of your hard work & success. Here are questions that come up for me (because I have some similar situations):
– You are receiving $400k of equity a year, and you state your company is solid and no concerns at this stage. My employer is similar and I worry that 17% of my net worth is tied up in one stock. General rule of thumb I keep reading is not to have more than 5-10% of your net worth tied up in a single stock. What do your wealth managers advise? You mention you could/should give more, something to consider: I have found my company stock shares a perfect means to donate (appreciated stock given to a charity, no taxes paid on appreciation & you get a write off).
-Curious as to what tax strategy tips you are receiving from your advisers that you haven’t read or heard from others?
-Last question is about inheritance & I realize that each individual has strong feelings about this, but what stirs the need to leave your daughter so much? When do you plan to talk to her about the potential wealth coming her way? My immigrant family became middle class in my teens, my parents paid for my undergraduate degree which helped me establish a good foundation. The rest has been through hard work. I really struggle with leaving a huge chunk for my children & that it can potentially deter ones drive to succeed and take away from the feeling of pure self-made accomplishment. Would love to hear your thoughts.
I’m in my late 40s and closing in on $4M in a month or so.
My thoughts: I don’t care how strong your company is I don’t think people should have their income and investments tied to the same company.
I get a good amount equity compensation and I sell it immediately upon vesting. It goes directly to retirement and is reinvested in diverse funds. The beauty of equity compensation is there is more on the table I still want the stock price to go up but I also want to be diversified.
I definitely worry about leaving money to my kids. I grew up hungry and driven I don’t know that my kids feel the same way. They are still young I hope to instill that hunger. I don’t want my success to make them soft.
To clarify….I am earning about 400K per year in stock and I have a similar amount vesting each year due to years of accumulation and stacking of vestings from multiple older grants. I cash out on every vesting date- so I do not have anything sitting with my company that I can access/sell. I sell on the 4 vesting dates I have per year and reinvest in my external brokerage account…even with the tax hit it does not matter to me- I can make it up with market diversification and growth. I believe in diversification period….and putting all of my eggs in one basket is counter to my beliefs. I see grants as free cash and less for their upside.
The additional 950K I have that is unvested…will vest over the course of the next 3 years…4x a year. I plan to continue in the same manner with that.
Re: donating stocks, that is not a path for me right now though I learned from ESI about DAFs and have that noted as a future state opportunity/priority. Versus donating my money to others, my daughter is simply my first priority- she is all I have and I am who she has. I believe you take care of your own before you take care of others. My perspective is if all goes well…We have plenty of time to donate if we accumulate beyond our needs in the future. I see myself in the “still building” and “I am comfortable but not wealthy yet” stage. I think when I hit $5M I will be more comfortable with giving beyond my immediate family.
The one thing my daughter does understand is giving her time to help others which I think is a great fist lesson in terms of giving back. She volunteers on her own accord and without any guidance or promoting which I like to see. There is a huge homeless population here in San Francisco and she empties my pocketbook to help them on a regular basis as well.
Will follow up additionally on the inheritance piece later! Hope that helps!
And I certainly look forward to seeing your profile!!!!
I wanted to offer an opposing view on this issue. I am early-retired since my 30s. I have always had a high percentage of net worth in employer stock. Even today, I still have 40% of my equity investments in employer stock, after selling off 99% of it over the years! This is due to my company stock going up 20,000% in its history since IPO.
My first financial advisor to my last all advised diversification as my net worth increased from $1+ million to 8 figures. In my case, diversifying was the absolute wrong thing to do. If I hadn’t diversified, I’d be sitting on $300 million today.
My company might be an extreme case, but there are a lot of extreme cases out there, e.g. Microsoft, Amazon, Netflix, Facebook, Google, Tesla, etc etc. No one rich got there by diversifying… the question is how high do you want to go?
It’s in a financial advisor’s interest for you to diversify. Diversification gives the advisor more of your assets to manage. Also, no advisor knows more about your company than you do, especially if you are in a position to have that much equity. I remember all the back and forth with my last advisor about my company’s future (I had retired by then already). He claimed he had a number of clients who were upper management level that didn’t believe in the future of the company. He also forwarded me some negative reports by an analyst that he attended a conference with. And yet just 3 years later, the stock is up another 1,000%.
So by all means diversify if you have “enough.” Just make sure you know exactly why you are doing it and make a note to yourself. The future you will thank you.
Learn enough eventually to manage it all by yourself. I’ve met dozens of advisors, my opinion about them is the same as ESI’s. I would move assets towards something much simpler, like a 3-fund Vanguard asset allocation, if I could. But the majority of my holdings are in taxable accounts with negligible cost basis. If you are in a situation where you can contribute future earnings to such an allocation, please research the option…
I agree with your summary.
I cash out because I don’t see a lot of upside in my stock at this point … hence I see it as cash and thus why I cash out as I hit vesting dates.
Part of how I got here was cashing out AFTER great growth.
Your take makes sense to me in all
regards. Thanks for sharing
I’m new to this site and am finding this all very inspirational. I have my taxable investments in a managed account and am interested in making the move to low cost index funds. Did you make a wholesale shift and sell off/take the tax hit or do you recommend opening another account for future savings, starting with indexing from the beginning? Then dealing with the managed account more slowly over time. Thanks!
Maybe Joe or others will comment as well….
I think for both of us we were discussing the transition from holding high quantities of employer stock to the more general low cost ETF, diversified portfolio.
Personally, I started selling once my stock peaked out (and luckily the timing was right and I didn’t miss any upside). Then from there forward I just started cashing out as I vested into a low cost diversified portfolio. So there was no costly transition hit for me. I did pay the taxes on my stock sales as I sold but that was the normal cost of doing business to get out of the stock and diversify.
Like I said I ousource my portfolio management … it sounds like you need help running the numbers on your current state vs a postential future state.
If you want to go low cost you know what to do with all future savings but maybe someone else can help you think about the best timing for selling and reinvesting in low cost investments with the existing assets. Probably depends on how expensive your current investments are relative to current returns….and what type of investments they are, ie tax implications.
Hopefully someone more experienced will jump in here….
You make a great point about giving more later and taking care of your own first. I actually struggle with this one. I donate to several charities in total about $20k a year. I get nothing in return but satisfaction of helping others and a tax deduction. I know family members who would love to have that kind of help. It’s a very tough choice and I don’t think there is a single right answer.
Completely agree. We need to each do what we believe is right for us at any given point in time.
I cover many family bills and loans and literally live paycheck to paycheck to maintain my high savings rate. I am doing all I can do at this time… or maybe I should say all I want to do at this time in terms of giving. I think how and to whom and how much I give could and will evolve over time depending on my priorities and I assume the same for many others. All aspects of giving and charity are personal choice.
JeffB M20 says
We started a scholarship at our alma mater. Wife gets matching money for our donations, so it only cost us $12,500 to endow a scholarship. We also donate to several other charities.
Great way to give! Matching is a great opportunity to take advantage of. Thanks for sharing this option. I can see this making sense for me after I get my daughter through her college expenses.
The thing is, when you donate to a DAF, it’s tax deductible. That’s a huge benefit at high income levels. It practically comes out even. Two years ago, I calculated that for every $50,000 donation in highly appreciated assets my cost was only about $10,000 on a cash basis. (You get a $50,000 tax deduction that to me was worth ~$20k, plus you don’t have to pay the tax on the sale of the asset which would be ~$20k). That is huge leverage and you are doing a lot of good with that money!
Thanks for this perspective. Great points and door to talk more about how to donate in a way that allows you to simultaneously optimize your finances. Good info!
Thank you for the interview, I found it very thought-provoking.
I’m early retired in the Bay Area. My expenses for a family of 3 have also settled around $150k/yr. I hear this number from other families around here as well. I have considerably lower housing expense than you since we own our home, but it’s mostly offset by unsubsidized health insurance costs.
I’m curious about a couple of issues: you plan on relocating out of the country, is your plan on having your daughter relocate with you?
I’m also wondering about your thoughts on wealth transfer to your daughter. I plan on educating mine about finances, but I only let her know that we have enough to survive, not enough for her to never work. I grew up as an orphan, I think the financial hardships I went through are what eventually led to my success, so I don’t want to make things too easy for her.
1- I do not plan to take my daughter. I expect she will head off to college and I will head in another direction in our next phase of life. I may be done when she graduates high school or I may work until she finishes college…or somewhere in between- TBD. Either way- I see my Caribbean house being her future vacation home or rainy day home vs her primary home as she is not as interested in a Caribbean or Mexico home as me.
2- I talk very freely with my daughter about our financial situation, how we make and save and grow money, etc. Funny enough- because we live paycheck to paycheck (because I save so much up front)- even though she knows “our number” she still thinks we are poor and as she says “on a budget all the time.” She has no good frame of reference for our financial situation. She talks about “the rich kids” to me casually not realizing that relatively speaking, some may consider her that. I do wonder when our number will make more sense to her…I assume after college and when she hits real life.
I do not have a lazy child- she cannot wait to get a job and make her own way. So my assumption is that she will hustle regardless of her future inheritance. The other reality is that she will not inherit anything until I pass on…so she may have a great many years of self sufficiency before any sizable pocket of money comes to her
I do envision paying for most of her college, buying her first car and hope to do things like provide a down payment towards her first house- all in the spirit of ensuring she doesn’t start off life with debt. But we emphasize savings in our household so if I do these things for her I expect that she will build her personal savings in lieu.
Again- I do want my daughter to have the opportunity to do whatever she loves. I feel the sacrifice will have already been made on my end so she doesn’t have to do anything just for money. I’d love to see her be an entrepreneur or freelancer and have the freedom to do so.
She sounds very well-adjusted. Great job raising her…
I smiled reading that she refers to others as “the rich kids”. But we do live in SF Bay Area, it’s easy to lose perspective here… 😀
Hope everything works out perfect for you after all your hard work and sacrifice. And I also hope you move towards the lifestyle you envision well before calling it quits… you’ve probably built up a lot of goodwill at your company already.
Thank you Joe 😉
Plenty to admire, period. Anyone with 4+ million heading into retirement is relatively safe from the current state of US healthcare, by my lights, depending upon the region. Anything less is a strange sort of gambling, barring some miracle (substantial health insurance and healthcare reform) or the ex-pat life. So stateside you can aim very high, full cash coverage for most anything AND the best insurance money can buy, or, likewise, aim low–down low enough, there’s a much better chance of preserving your principal home, and modest nest egg while reaping substantial care coverage via Medicaid. Better than Medicare in its current state, that’s for sure, only if you’re eligible of course. I strongly believe many boomers and others are up for financial slaughter or mayhem between the poles, so to speak, barring some kind of miracle, or very great luck. I guess we’ll see, and hope to be wrong, without believing so. I think it’s also important to note that outside a few rare exceptions, you really can’t have it all. Something gives, or you’re not being completely honest. The body begins to deteriorate at age 40, more or less. Peak earning time. If you want a stellar career, the hours will impact your relationships and/or family, likewise regarding the reverse. I infinitely prefer 32-hour weeks with full medical, perks and benefits, all that free extra time with the gf, plus a (now) 51% savings rate. That’s currently funding a substantial cash buffer, a hot as heck 401(k), then a simple brokerage account, one other fund. I would only consider a traditional IRA, ever, though I prefer the maneuverability of a brokerage account exclusively. Just depends . . . also have to agree that a year’s coverage of living expenses should be the bare minimum, not the max. I’m aiming for two years coverage, then I’ll feel better. Three to six months is a joke, though certainly better than nothing, or just a 1k buffer, hard enough for millions still flailing. Also, I again have to wonder, exactly who could possibly appreciate or deserve the results of all that hard work and capital growth more, a stranger or your own blood? So I certainly dig the conclusion in this case, leaving it all for the daughter, within reason. And while others look down the nose at those ‘opposed’ or reluctant to feed bloated charities and church mechanisms, I am quite the reverse, 100% opposed. Conversely, 100% in favor of leaving it all to one’s beloved own, assuming they have a reasonably level head, in trusts and such as necessary. Just my personal opinions. I’m not here to make friends and high-five others endlessly, only to think, learn, and strategize. Beyond that, I really only live for the sake of money and the gf, not the world or others. One’s family and career path should be challenging enough.
Also, exactly how many 20-something Americans had their act together, way ahead of the curve? Seemingly only here, maybe, in the land of the few, the rare, the exceptional.