On track, getting to be ahead of schedule.

[starguru]

4 years ago I said I wanted to reach $1M liquid by age 40.  Im 36, and today I hit 600k total liquid net worth.  I still have ~70-80k in RSUs, employee stock program payouts, and bonuses to look forward to this year,  in addition to my salary, most of which is going straight into investments.   This does not count home equity, wife's holdings, or child's education savings. 

Fingers crossed I continue on this trajectory. 

[Eurotexan]

Good luck! Isn't it amazing how fast it all accumulates when you get to a certain NW?

[starguru]

I don't feel that way yet.  My contributions still dominate the growth of my stash.  When my contributions is <~5% I think Ill feel that way.

[retirein5yrs]

Well done!

I also can't wait for that moment when my NW is growing by more than I can contribute!

Congrats on getting ahead of schedule, its why I like tracking my own progress not only on a long term scale but with short term milestones too!

[sleepyguy]

IMPRESSIVE!  I'm just a year younger than you and I'm not even close by a country mile :)

4 years ago I said I wanted to reach $1M liquid by age 40.  Im 36, and today I hit 600k total liquid net worth.  I still have ~70-80k in RSUs, employee stock program payouts, and bonuses to look forward to this year,  in addition to my salary, most of which is going straight into investments.   This does not count home equity, wife's holdings, or child's education savings. 

Fingers crossed I continue on this trajectory.

[zolotiyeruki]

Good luck! Isn't it amazing how fast it all accumulates when you get to a certain NW?

So true, and it doesn't even have to be *that* much of a NW.  A few years back I left a higher-paying job I hated for a lower-paying job that I love, and while we've still been able to save *some* for retirement, it's not nearly as much as we'd like to.  (our savings rate dropped from 25% to under 10%)  In fact, the returns on what we saved those first several years are already outstripping the amounts we add each year, by a wide margin.  Not only that, but with our current trajectory, the savings from those first six years will eventually comprise about 75% of our nest egg.

"Most powerful force in the universe" indeed.

[Bateaux]

Star guru there are few things in life that can prevent you from reaching your goals now.  The foundation is laid and its only going to get easier.  You are ahead of where I was at 36, in fact even though I have a little more in the pot I think you'll pass me by soon and I'm 45.  Your rate of rise is faster.  Live a great life and best of luck.

[starguru]

Star guru there are few things in life that can prevent you from reaching your goals now.  The foundation is laid and its only going to get easier.  You are ahead of where I was at 36, in fact even though I have a little more in the pot I think you'll pass me by soon and I'm 45.  Your rate of rise is faster.  Live a great life and best of luck.

Thanx for these kind words.  I worry that I didn't set my goal aggressively enough.  Back when I formed the goal of 1MM by 40, I was barely maxing out my SEP.  At that point, with 200k saved, saving 100k a year was a long shot.  I remember saying "Im gonna need help". 

However, I managed to increase my income x2, most of the increase being saved (avoid lifestyle inflation; although did have a kid and buy a house so expenses went up).  I remember talking with my mom, and she said "If you can get to 1 MM by 40, you can get to 2 MM by 46, and 3 MM by 50" since all that capital really starts working for you. 

But, things being where they are, now reaching my goals seems almost assured (fingers crossed), so it might be time to reevaluate.  Im wondering if I can move things up by a year.  1MM by 39, 2MM by 45, and 3MM by 49 (then retire). 

Or I can just stop worrying and figure it out as i go.  Although my earnings seem stable, and I like my job, no way to know if both will continue. No way to know if there will be a market crash. 

Hmmm

[starguru]

Just to update this, I checked personal capital today and my liquid net worth is 701605.  That's the goalpost for 2015 (remembering the plan was formulated 5 years ago).  Of course, the monthly mortgage and credit card suck is about to happen, but it feels good to be a full year ahead of schedule. 

[Exflyboy]

Very good indeed..:)

And of course you won't NEED $3M to retire so I suspect your priorities might change as you get closer (mine did.. I wanted $2.2M.. but get off the roller coaster to a degree at $1.2M).

As to the savings rate, my advice would be to not let it slip.. reason being is we might be close to the top of the market.. we don't know of course.. For all we know we might even be at year 6 of a 20 secular bull. But lest assume we are in for a significant pullback 20% or so.

Naturally your NW (as will everybody's) will shrink. The thing is though, if you are still socking money away into ETF's you'll be buying them at a cheaper and cheaper price. WHEN the market rebounds it will snap back rapidly and those cheap shares you bought will add to your NW substantially.

So if you have a number of years to go to be FI.. Don't slow down on the saving just because the returns right now are making 15%+ annual addition to your portfolio.

Frank

[starguru]

Very good indeed..:)

And of course you won't NEED $3M to retire so I suspect your priorities might change as you get closer (mine did.. I wanted $2.2M.. but get off the roller coaster to a degree at $1.2M).

As to the savings rate, my advice would be to not let it slip.. reason being is we might be close to the top of the market.. we don't know of course.. For all we know we might even be at year 6 of a 20 secular bull. But lest assume we are in for a significant pullback 20% or so.

Naturally your NW (as will everybody's) will shrink. The thing is though, if you are still socking money away into ETF's you'll be buying them at a cheaper and cheaper price. WHEN the market rebounds it will snap back rapidly and those cheap shares you bought will add to your NW substantially.

So if you have a number of years to go to be FI.. Don't slow down on the saving just because the returns right now are making 15%+ annual addition to your portfolio.

Frank

I have been careful to avoid serious lifestyle inflation.  Luckily I resisted my strong desire for an E63AMG a few years back.  :)  Even though we are not mustachian, we live below our means, so between the wife and I we are socking away 150k+ a year.   I do have spending weaknesses (watches) but my desire to reach 1MM is stronger than my desire to own a Patek (although not by much :)).  Of course, the biggest threat to our savings rate is the possibility of having another child.  that'll easily take 30k/year off our savings.  Unsure what we are doing on that front.

RE the market, if I look at it the following way: If there is not a major pullback in the next few years, Ill reach my 1MM by the target date, if not before.  If there is a major pullback, I might miss my goal, but like you say I will then be purchasing serious amounts of discounted shares, so when the recovery happens I imagine I will blow by the 1MM.  I almost want a pullback so I can get in on some discounted shares, but we all have to take what we are dealt.

[Exflyboy]

Yup.. buying during the 2008 downturn is how I got to be "retired"

[starguru]

So close to 800k.  I have a feeling markets will pull back though before they put me over....

[Cougar]

So close to 800k.  I have a feeling markets will pull back though before they put me over....

Congrats !

I'm about where you are, 800k, putting about 50k ahead yearly.


I also agree with you, imo the markets will have at least a 10% correction sometime this year, even with governments all over pushing it up with QE. you can see that govts are not getting their QE bang for the buck anymore(its barely up 3% this year with the weak season coming) and the overall US economy has been weakening.

[starguru]

So close to 800k.  I have a feeling markets will pull back though before they put me over....

Congrats !

I'm about where you are, 800k, putting about 50k ahead yearly.


I also agree with you, imo the markets will have at least a 10% correction sometime this year, even with governments all over pushing it up with QE. you can see that govts are not getting their QE bang for the buck anymore(its barely up 3% this year with the weak season coming) and the overall US economy has been weakening.

Im resisting the urge to sell my equities and hold them in cash.  No-one knows what will happen.  We could have a crash, or we could go sideways for a few years until companies grow into their valuations, or the bull could continue. 

My bond allocation is low, so maybe Ill compromise and just get that straitened out.

Its possible I hit 900k this year, as I have about 120k in RSUs, ESPP, and bonuses coming in (before taxes), but markets would have to do me a favor, or my employers stock would have to rise significantly. 

In any event, life is good!

[starguru]

Got my final bunch of RSUs for the year last week, which brought me to about $817k.  Hopefully 900k by April!  Also sold about half of my RSUs to bring my RSU exposure to about 10%, and began the process of releasing  financial advisors that were managing about 100k of my assets.  Almost on cruise control.

[PaulMaxime]

Yup.. buying during the 2008 downturn is how I got to be "retired"

2008-2009 was the best thing that ever happened to me financially. My liquid net worth has increased by >500% since 3/2009.

[patrickza]

You're moving really fast starguru, well done! I had the same goal of $1m by 40, but our currency seems to be having other ideas...

[starguru]

Yeah am moving fast.  I just realized as I turned 38 last month that my line of thinking that 800k was my guidepost for next year to reach 1M by 40 was off; it's my milestone for this year.  So I'm barely on track. 

Hopefully markets will cooperate.