At what amount did your investments really start rolling ?

[Daisyedwards800]

To the point where your wages weren't as important.

[mrteacher]

I started to notice my investments "rolling" (sometimes up, sometimes down!) when I hit $200,000 in the market, a number I hit last fall.

My $ in the market dropped $15,000 from last 10/1-10/31. Over the first two months of 2019 it has increased well over $20,000. That is not to say my wages are not important; but, boy, the past six months has been eye opening. 

[nereo]

The more you have in investments, the less of a difference subsequent contributions have on your total NW

For us we first saw our capitol gains outpace our annual contributions when we had just under 5x expenses invested. As mrteacher noted it cuts both ways; a down year will (on paper) result in much larger losses than we can replace with our paycheques.  I had previously calculated that for us (~median income level), once we hit 18x worth of expenses any additional contributions will only change our FI date by a few months at best.  Not that we will stop contributing - the tax benefits alone make it worthwhile, but each subsequent dollar makes less and less of a difference.

[maginvizIZ]

I'd agree around the ~$200k mark.  With the market volatility, I've seen my portfolio make bigger swings than what my gross income is.  Pretty eye opening to see a 10%+ swing (from Dec 24, to nowish) to see $20+k in difference.  I don't make $20k in 3 months... So seeing passive growth exceed annual income (although obviously not consistently doing so) has been shocking/fun.

[Tester]

I am at about 230k and it started showing.
I am now focused on getting to 500k asap so I can worry less.

[I'm a red panda]

quite honestly I feel like I noticed the months with giant losses way more than I've ever noticed that we have months with lots of gains.

I can't ever remember having a month with a gain close to my annual income. But there have definitely been months with that loss

[nereo]

quite honestly I feel like I noticed the months with giant losses way more than I've ever noticed that we have months with lots of gains.

I can't ever remember having a month with a gain close to my annual income. But there have definitely been months with that loss

A great example of loss-aversion
https://www.investopedia.com/terms/l/loss-psychology.asp

[I'm a red panda]

quite honestly I feel like I noticed the months with giant losses way more than I've ever noticed that we have months with lots of gains.

I can't ever remember having a month with a gain close to my annual income. But there have definitely been months with that loss

A great example of loss-aversion
https://www.investopedia.com/terms/l/loss-psychology.asp

Not really. The losses don't bother me. I just note them. Not at all what your link is describing.


I actually just went back and looked through my records. I really don't have any months with growth near as big as the months I have large drops. The growth has been slow and steady the drops have been sudden and large.

[mrteacher]

Interesting what nereo points out about each subsequent dollar mattering less and less because, for me, even thought that is true, the increase in excitement/satisfaction at more sizable growths has resulted in an increased desire to continue contributing!

[Goldy]

I didn’t start really paying attention until i had already accumulated some but the first number I remember making me blink was when our annual gains eclipsed our salary.  It was like having a third person working in the family.  Fast forward a couple years and now my annual salary can be exceeded (up or down)in a month.  It feels like a runaway train now.

[englishteacheralex]

We're at around $150k and it feels like nothing is happening at all; like the whole thing is just a magic beans promise. We shovel in $2300/month. I'm posting here to help myself keep the faith.

[MayDay]

We started noticing at 500k.

That's when we started feeling like in a given month our investments make more than our income. It's pretty wild.

Now we are a bit over 750k and the rough market in December/Jan was Rough. But we've already recovered.

[mrteacher]

We're at around $150k and it feels like nothing is happening at all; like the whole thing is just a magic beans promise. We shovel in $2300/month. I'm posting here to help myself keep the faith.

Really? What sorts of fluctuation would make you feel like something is happening?

[Brother Esau]

We started noticing at 500k.

That's when we started feeling like in a given month our investments make more than our income. It's pretty wild.

Now we are a bit over 750k and the rough market in December/Jan was Rough. But we've already recovered.

We're in this same boat. Yesterday was one of those days where we went up over $10k in a single day.

[englishteacheralex]

We're at around $150k and it feels like nothing is happening at all; like the whole thing is just a magic beans promise. We shovel in $2300/month. I'm posting here to help myself keep the faith.

Really? What sorts of fluctuation would make you feel like something is happening?

You know, 2017 was a year where our net worth was going up by $5k-$10k per month because of home appreciation and our index funds. That felt like something was happening. But we are just now getting to the exact same point where we were at our peak in August 2018. And during that 6 month period or so, we actually started raising our contributions because of "stocks on sale". We know what we're doing but somehow it's still a little discouraging.

[GuitarStv]

You know, 2017 was a year where our net worth was going up by $5k-$10k per month because of home appreciation and our index funds.

Home appreciation is monopoly money.  It only becomes real when you sell the home, so I'm not sure it's a great thing to include in your net worth.

[nereo]

This thread makes me realize how infrequently I check my portfolio balance (maybe 2x/year) or pay attention to market movements. 

It's one of the few areas in life where negligence really pays off...

[englishteacheralex]

You know, 2017 was a year where our net worth was going up by $5k-$10k per month because of home appreciation and our index funds.

Home appreciation is monopoly money.  It only becomes real when you sell the home, so I'm not sure it's a great thing to include in your net worth.

I know. I'm well versed in Mustachian net worth philosophy. I like including it.

[MustacheAnxiety]

I think it was less the amount and more the timing.  It seems like everyone's investments were making great leaps in 2017. 

Looking back over my lifetime of working it is such a big difference from having substantial student loans fighting against FI and having a bunch of savings contributing to it, even if it wasn't that noticeable at the time.

If it helps motivate you, multiply your savings by your preferred SWR and think about your savings as contributing that additional amount to the family, regardless of what the market is doing.

[BlueHouse]

Around $750K I guess I started to really notice the swings.  But then the past few years we've seen a lot of volatility/growth in the market, so there's that. 

[GoHokies]

I started to notice it around $200k.  I have been tracking my net worth in a spreadsheet for the past 4 years.  Back when my investments were under $200k and in particular, under $100k, I felt like my ability to save in a particular month had a direct impact on how much my net worth would increase the next month.  Once it got to $200k I noticed that even if I had a really cheap month where I spent very little, the change in net worth was much more heavily driven by the market performance. 

It's kind of sad as it used to be that my savings efforts had very tangible/visible effects on my net worth.  Now the month to month changes are largely outside of my circle of control (although I still recognize the importance of saving). 

[honeybbq]

I think for me when I hit around 1MM. Then with a really good or bad year I was gaining (or losing) more than I'd make in a year.

[catccc]

IDK, we hit $1M last August and it still feels like we are creeping along.  It's just so volatile, it doesn't feel like we've got it made.  I have big gains and losses, and I just kinda shrug my shoulders, neither one make my earnings seem less or more valuable.  A dollar is a dollar.  I mean, it's cool when your NW goes up more than you earned in a year, and I like to marvel at the comparisons once in a while, but I guess I'm used to the swings where I mostly feel equanimity when faced with the changes.

[the_fixer]

I would say when I first started each month it would jump by a large amount due to my bi weekly contributions and it was easy to make it double in a year.

Then once I hit the 150k plus range it seemed like I was stuck in the doldrums as the biweekly contributions no longer had a significant perceived impact and the compounding had not really kicked in.

Once it hit the 500k + invested it feels like big strides again due to market gains and the bi monthly deposits from my paycheck are so small in comparison that they do not move the needle but that magical compounding works  :)

Sent from my Pixel 2 XL using Tapatalk

[Off the Wheel]

I notice the swings, but considering I only started tracking seriously last year and the market was so volatile, it definitely doesn't feel as impactful towards my FIRE goals as my savings. That might also be influenced by the fact that my net worth is 75% real estate (VHCOL area).

[tralfamadorian]

There have been some good threads about this (the first links for a few more as well):
https://forum.mrmoneymustache.com/ask-a-mustachian/snowball-effect/
https://forum.mrmoneymustache.com/ask-a-mustachian/when-did-you-notice-compounding/

[Fomerly known as something]

I'll jump on the about $200,000 when I saw it gaining momentum.  At about $500,000 is when I went wow this compounding shit is the real deal woah nelly.

[alcon835]

This thread makes me realize how infrequently I check my portfolio balance (maybe 2x/year) or pay attention to market movements. 

It's one of the few areas in life where negligence really pays off...

This may be the most solid gold in this whole thread. Last year I really got into investing and have been paying waaaay too much attention to my investments. At the same time, I started tracking a particular investment but less frequently for a paper (I took note of its value at purchase, 30/60/90/6mo/12mo).

What I've noticed is that big drops or pick-ups in the market affect me a lot because I'm paying attention and then extrapulating a single day/week/month's ups and downs out for the remainder of my life (a fool's game at best). But for that investment I check infrequently...well every time I see it I'm happy. I've skipped over the emotional beats of the day-to-day grind and been able to see the value of less frequent checking (and there's quite a bit of value there!).

Using this, I've created a yearly spreadsheet where I track my investments quarterly. I won't be able to stop checking my investments regularly (at least not for awhile), but having a place to go back to and say, "This is reality, not that other place" is a strong emotional hit that I need from time-to-time.

[I'm a red panda]

This thread makes me realize how infrequently I check my portfolio balance (maybe 2x/year) or pay attention to market movements. 

It's one of the few areas in life where negligence really pays off...

This may be the most solid gold in this whole thread. Last year I really got into investing and have been paying waaaay too much attention to my investments. At the same time, I started tracking a particular investment but less frequently for a paper (I took note of its value at purchase, 30/60/90/6mo/12mo).

What I've noticed is that big drops or pick-ups in the market affect me a lot because I'm paying attention and then extrapulating a single day/week/month's ups and downs out for the remainder of my life (a fool's game at best). But for that investment I check infrequently...well every time I see it I'm happy. I've skipped over the emotional beats of the day-to-day grind and been able to see the value of less frequent checking (and there's quite a bit of value there!).

Using this, I've created a yearly spreadsheet where I track my investments quarterly. I won't be able to stop checking my investments regularly (at least not for awhile), but having a place to go back to and say, "This is reality, not that other place" is a strong emotional hit that I need from time-to-time.

We check all our accounts biweekly just to make sure nothing has happened to them.  I would not want to check infrequently and then later discover they have been hacked and drained.

[FIPurpose]

(Assuming ~8% inflation-adjusted gains)

I attached a graph of if you give a consistent (inflation adjusted) amount, your investments are going to equal your contributions around the 10 year mark.

The second graph is how your investment gains compare to your spending.

So the typical spending rate around here seems to be 30-50%.

- That means your investment gains will equal your spending after 6-10 years.
- Your investment will be earning double your spending after 9-15 years.
- Triple after 12-20 years.

Hope these help!