I just became a millionaire at age 35, AMA (I've never made more than 150k annually)

I hit the $1M mark in Feb 2020, was really happy for myself, then found out I had incurable blood cancer in May 2020. Money doesn’t matter so much anymore. Your health and relationships is what matters.

Vegas dude wrote:

I disagree. Let's say my neighbor and I both have $5M in the bank. I live in a $6M house that I just bought on a $5M 20 year mortgage.

No financial advisor in their right mind would think it's a good idea for someone with $6M liquid net worth to buy a $6M house.

Hate to break it to you, but you’re not technically a millionaire yet. You might have gross assets over 1 million, but you also have taxes payable on unrealized cap gains and deferred taxes on your retirement accounts.

More importantly, he can't really access the majority of his "wealth" without incurring penalties...

That’s pretty impressive on that salary. It took me a few more years and I make quite a bit more. I do have 3 mouths to feed, clothe, and put through school.

I also have a $100K car that I finance. My balance is about $60K on it at 1.9% and I could pay it off today if I wanted to. Cars are my passion and I’m not waiting until I’m in my late 50s to buy my dream car. Only true car people appreciate it, so it’s not about being flashy.

Like all of us, you’ve had a little bit of luck on your side. Both equities and real estate have had an amazing 5 year run. I wouldn’t expect the same kind of returns over the next 5 year period. Be prepared that your NW could even be cut in half at some point. Not likely, but possible.

No financial advisor was able to save as much as I have as quickly.

juvie wrote:

Hate to break it to you, but you’re not technically a millionaire yet. You might have gross assets over 1 million, but you also have taxes payable on unrealized cap gains and deferred taxes on your retirement accounts.

The long term capital gains bracket is 0% up to 80 grand in income for a married couple so maybe not.

You’re correct about the retirement accounts but that too can be gamed to minimize tax. You could live in a state with no income tax. You can try to live on very little spending (which is easier with a paid off house in a place with low cost of living). If that’s the case the federal standard deduction is $25k for a married couple and some people can keep their income lower than that and pay $0 taxes. At that level you’d also qualify for ACA subsidies for healthcare.

My spending is higher than that but my future plan is to live on $80k for the 0% LTCG tax plus at that point I’m still only in the 12% marginal federal bracket which will work out to maybe 8% effective tax rate if spend the full $80k. Fingers crossed that will work.

juvie wrote:

Hate to break it to you, but you’re not technically a millionaire yet. You might have gross assets over 1 million, but you also have taxes payable on unrealized cap gains and deferred taxes on your retirement accounts.

Facepalm.

the long road wrote:

I've been tracking my Net Worth since late 2016. This pay period I crossed the 1 million mark in net assets at age 35. I have never made over 150k annually.

Date NW Salary

12/31/16 209k 77k + 24k spouse

12/31/17 309k 93k + 24k spouse

12/31/18 353k 101k + 25k spouse

12/31/19 496k 118k

12/31/20 646k 142k

12/31/21 1,001k 150k

Gonna need a photo of your wife to vet this claim.

You and your wife are two people not one person. If you got divorced would you come away with $1 million and your wife nothing? You two are worth $500k each.

LRC changed the title of the thread?

https://i.imgur.com/axl40Mj.jpg

how do you embed a damn image on this site. I'm being funny

https://imgur.com/a/HRLHHNW

Nice job, OP!

It’s impressive to achieve this milestone at your income level and at your age! Great job investing early in your life!

I’m at around $1.4M at age 38. I used to have really low salary and didn’t do a good job investing. Then at early 30, my income level changed quite a bit allowing me to catch up quickly.

Of all the people saying they $1million is not enough or not significant. While, it’s true that it’ll be difficult to retire with that amount. But you’re all not thinking about power of compounding. Since he is already at $1million at age 35, with power of compounding, he has set him up very nicely for the future. In fact, he can definitely slow down in contributing if he wants as he’ll start to make more from his investing rather than from his contribution. And it will only get better from here.

Vegas dude wrote:

I am not a fan of subtracting the mortgage balance. You have the appreciating asset. I buy stocks on margin. I sell some of them in the same day but if I used the logic if subtracting my liability from my net worth, my net worth decreases by $100k one hour and then increases the next hour when I no longer have that liability.

Dude... you might want to take a high-school business class. Or math class. Or maybe just Google "asset" and "liability." If you buy stocks on margin, you simultaneously gain an asset (the stock) and incur a matching liability, so your net worth doesn't change (until the stock price rises or falls). When you sell that stock, the reverse happens. The only change in your net worth comes from changes in the stock price.

Yes, yes, I know you're super rich and have beaten the market and made more than any poor fool who works a "job." That's great, and I totally believe you. But that still doesn't mean that having a mortgage (or buying stocks on margin) doesn't incur a liability.

the long run wrote:

Make up of net worth is:

20k in cash

386k home equity

594k in Vanguard total stock market index between HSA, 401k, IRAs

I guess I am also a millionaire if I counted everything in this list, but I feel like I'm scraping by. All my money is tied up in investments that I don't know what to do with.

I can’t imagine being self-important enough to start a thread like this. I can only imagine how boring of an individual TS is.

testosteronedoesit wrote:

I can’t imagine being self-important enough to start a thread like this. I can only imagine how boring of an individual TS is.

I mean, they're an accountant and a runner (probably, if they're here). They just talk about the numbers they keep track of in spreadsheets. Dollars, paces, miles. If an activity doesn't lend itself to excel tracking, is it even real?

If Trump were still president I might be a millionaire too. Covid ruined Trump's reelection campaign and ruined my world. Everything in my world was fine til the last week of February 2020 and it has been a steaming pile of Sh!t ever since. Because of Biden I am going to have to work to 70 in order to retire.

ihatejoe wrote:

If Trump were still president I might be a millionaire too. Covid ruined Trump's reelection campaign and ruined my world. Everything in my world was fine til the last week of February 2020 and it has been a steaming pile of Sh!t ever since. Because of Biden I am going to have to work to 70 in order to retire.

If you really believe all that, I doubt you have the mental capacity to plan your retirement. This is just how long you expect to have to work, and you'll probably have to go longer.