Wealth Accumulation

[Car-Guy]

Personal Wealth Accumulation

For those who to care to share, retired or not, how did you accumulate your wealth? (Use your definition of wealth) Working for the man at (mega corp(s), owned your own business, inheritance, gifts, investing, lottery , etc.. Or some combination or other source.

For me, even though I received a rather large inheritance well after I retired, I accumulated the majority of mine simply working for a mega corp "and" contributing/investing the max amount to the companies matching 401k for ~30 years. Pretty simple, IMO.

So for the younger folks on this forum, you can accumulate a good chunk of money (even millions) as a worker bee, as I did. I don't think I'm an exception or a rare case. Just steady work, saved, invested (conservatively), took advantage of things like a companies matching 401k, (that is a big deal over 30 years), etc. Of course getting a well paying job helps.

Anyone else care to share their wealth accumulation story?

 

[youbet]

inheritance, gifts, investing, lottery

Had a negative inheritance (spent money to help MIL). Never received more than a token gift such a new socks for my birthday. Mediocre investment results, but no "big mistakes." Never bought a lottery ticket.

We did fully fund our 401k's, 403b's and IRA's for decades which, as in your case, paid off in the long run. DW retired at 55 and I began long term unemployment at 58.

 

[street]

No inheritance from either side of wife or my family. Found my career early in life stuck with same place of employment for 35 years.

So, my wealth came from hard work, saving and living below my means, and sticking my neck out a few times in real estate and did very well when selling.

Also doing just about everything possible myself without hiring anyone, for about any task. Even built my own home from ground up and saved a huge amount of money. I haven't had a loan in over 35 years and always bought used vehicles in my working years.

Accumulate early and kept that up with compounding through the years was a good recipe for me.

 

[Gumby]

I worked hard, I didn't spend all the money I made, and I invested the savings. No inheritance, no lottery. Nothing but work, save, and invest.

 

[Livefree]

Real Estate (I was a landlord)


Stock Market 401k, IRA, Roth's etc.


Worked 42 years full time

 

[wdwwildbill]

Inherited $ 900.00 when I was 12 from my aunt when she passed ( think I was her favrite ) I split that with my 3 siblings, as we always shared. Other than that, nothing else but hard hard blue collar work. Still grinding but getting there. Save save save . no pensions no lottery wins. live below my means .. Start early !!!

 

[W2R]

Started out with negative net worth at age 50 after a financially disastrous divorce.

Chose a federal job because of the pension and health insurance, even though the salary was lower than I could have earned elsewhere. Worked hard and saved every single cent I possibly could. Basically I lived like a college student, even though I had a decent job.

Invested carefully and didn't take risks with highly volatile investments. Investing was life-and-death for me, I realized, since there was no White Knight out there prepared to rescue me if I failed in my financial goals. Read books on the Bogleheads book list. Thought long and hard about all the "What ifs" that I could come up with.

Got to my (fairly modest) financial goal for retirement two years before I could retire. My first retirement date was dictated by my date of eligibility for carrying health insurance on into retirement (there was no ACA back then). So, I worked those last two years exactly like the previous years and saved up some extra money that way.

*Then* received a completely unexpected inheritance. More modest than grand, but still a big help. Never spent any of it but it's there earning money for me. Continued living like student and added my savings to my nest egg.

Along the way I bought and paid off a modest home, and saved up enough cash to afford getting SS at age 70 instead of age 62. (I paid myself the difference in SS amounts between ages 62-70 out of that cash). No debt other than the home mortgage which I paid off in four years.

In other words, I did everything I could think of, and took full responsibility for my retirement, and good luck was part of it too.

 

[NW-Bound]

... Nothing but work, save, and invest.

Same here, but I could have done better about the investing part. Ignorant, and too conservative, hence kept much money in accounts earning peanuts.

 

[Surewhitey]

I was a financial idiots until I got married. We started with 0 @ 26&32. In 1998, we "learned" about the stock market (internet boom/bust) then moved to the big city earning $55k ea in 1999. Paid off the house in 2003 (thanks to listening to Dave Ramsey). DD paid college and married off.

DW was in insurance and she exploded after taking a position in LA for a few years & then again when we returned to the j*bs in 2015.

She's 2/3 of our contribution these days & getting profit sharing, bonuses and RSU's from big insurance. I started a small biz to coast into ER. We are currently making enough from the portfolio to pay for our lifestyle, so banking a chunk currently.

We've always lived on the smaller income and saved the other for 26 years (minus 3 year sabbatical). At 52 & 56, we're in top 2% NW according to the recent statistics & all from the man, investing & taking a move to give us a boost.

All this with just a HS education... Both of us from the sticks of AR & Louisiana...

Been living, all in, on about $60k. No debt since 2003.

 

[aja8888]

Negative inheritance (had to pay to bury both parents).
My parents didn't pay for anything for me growing up - did college on my own
Costly California divorce in 1992 brought my net worth down to essentially $0.
Worked and saved, saved, saved..
No pensions,
Put two daughters through college with no loans.
Mediocre results in the investment world.
I made it and it was all on my own.

 

[tryan]

Rental real estate here ... 23 "doors" at my peak. Left mega corp at 45 and started selling at peaks. The wad was big enough to survive a divorce at 55. Other wise I would have returned to w@rk.

 

[HenryD]

Started out with negative net worth at age 50 after a financially disastrous divorce.

My divorce at 45 didn't send me negative but did take over 80% of my NW. Any chance of an inheritance to me evaporated with the divorce although DD is already getting some directly from her GPs on that side, so that is good.

I'm happily remarried but DW brought next to no NW. The first thing we did after marriage was save to pay off her ancient school loans. FIL (divorced) and MIL (divorced and widowed) have no property or investments. Both are or will be on government assistance, as is my DM (widowed). We help them all here and there, and they've all lived with us at some point.

DW had great earning potential when we met and, with encouragement and support, she has now eclipsed my income. We are 23 months from our target date and number. Assuming we get there, and barring anything unforeseen, everything we'll have will have been generated from the fruits of our own labor and investment of the proceeds. No windfalls or payouts of any kind.

 

[Souschef]

In my early 20's, I was an overseas Field Engineer. I did not have the vices of the older men, such as booze and women. I lived on my per diem and banked my salary. Since I was overseas, I paid no income taxes.
That was in 1960.

I started investing in the market at a young age, and did not do much trading.
Fast forward to 2009 when I cashed in my 401K, which I had always putting the max in,and converted to a self directed IRA. I was extremely lucky that I put the money into a mutual fund that really grew. As of 2023, it has grown at a rate of over 14%!
Also my company had a retirement plan that they froze years before I retired, but I get $1200 a month from that. That, plus my SS, is a good cushion to live on..

 

[CRLLS]

I started out with the minimum 401K contribution to get matching. Then 1/2 of every pay raise went to increasing that contribution. When we got to where we could afford the IRAs, we did that. When catchup contributions were available, we maxed out those too. I got a small inheritance that helped us out between jobs without having to w/d from the retirement funds. When I was retired by MegaCorp we had enough, but DW went back to work for a few years, and I took a small part time consulting job. Her job helped to reduce our withdrawals and provided the health insurance, leaving us with a bigger retirement bucket.

 

[retire48in2018]

LBYM and saved. Invest buy & hold in mutual funds.

No inheritance, negative like others that we had to pay some late expenses, and funeral etc for MIL.

No lottery, no extras.

Lived “normal” until 29, when we heard Dave Ramsey and stopped being normal and went insane on getting out of debt and started saving.

Took 22 years of seriously LBYM, and save/invest to retire early at 51.

 

[pb4uski]

....So for the younger folks on this forum, you can accumulate a good chunk of money (even millions) as a worker bee, as I did. I don't think I'm an exception or a rare case. Just steady work, saved, invested (conservatively), took advantage of things like a companies matching 401k, (that is a big deal over 30 years), etc. Of course getting a well paying job helps.

Anyone else care to share their wealth accumulation story?

You are not an exception at all. Similar story here and DSister is the same thing.

Ours is principally LBYM and savings and investing. Just sure and steady wins the race type of thing. Have still never taken money out of tax-deferred retirement funds after 11 years of retirement.

Strong annual contrbutions to employer 401k, eventually up to the annual contribution limit. Some of my investing was for our kid's college... dollar cost averaging into Vanguard STAR fund but then when DD was in college I had a well paying job and was able to pay college costs from annual bonus and cash flow and then DS decided not to go to college.

No inheritances yet. Only gift to us was my parents paying for my college so I graduated debt free. DW had modest amount of student loans (~$10k IIRC).

We did make a good profit on our first house in our early 30's and a good profit on a lakefront lot that we owned for a few years in the mid-2000s... probably $75k in each case.

 

[dunkelblau]

For me it was base megacorp salary for 3+ decades, plus not-so-much adder from cash bonuses/stock grants/discounted employee stock purchases, plus minimal gains from employee stock options (lifetime total was a couple of months final salary). I wasn't particularly well-paid; though my peak as an engineer sat well below what a doctor or lawyer would earn, it came much earlier, so we get the benefit of high slewrate if we can act accordingly, aka don't wait till later to save/invest. My biggest financial mistake was starting my 401k two years after I was eligible, and I have a colleague to whom I owe a house for prodding me into immediately filling out the paperwork once he found out I hadn't enrolled.

I think my secret sauce was mostly my consistently low expenses from congenital spending aversion. My low spend both increased the numerator (net investments) and shrunk the denominator (annual expenses), so I was able reach base FI (ratio>30 years) in my early 40s.

Maybe a small part of it was my willingness to take on widely diversified high risk stock market bets. I lost most of them but the small percentage of big winners made up for those and then some. No idea how well my stock trading would have gone without the market tailwinds we've experienced during this timeframe. FWIW my 401k was always 100% index funds and returns seem roughly comparable, so maybe my stock trading made no difference at all.

Where I worked financial acumen was more rule than exception amongst the engineers (maybe not so much for those in sales and marketing). That environment probably helped me stay the course for so long.

 

[Unpaintedhuffhines]

Contributed the maximum into 401k since that was a thing (including "catch-up" allowances).

When I was 40 years old, I had $27,000 in a brokerage account that I used to play the market (reminds me of my father's adage "every man has a great idea for making money that will not work" haha). Experimented with investing, including call options and put options and learned a lot. At that time, I think I had about $80K in my 401k, so maybe a little more than $100K in assets.

Was very fortunate to have a string of good years (and a couple of great years) in high tech sales & sales leadership.

In April of 2009, I was only halfway to my first million. We took the attitude of enjoying some of our earnings (Ex: 2-week family trip to Europe, all five of us in business class), but overall living well below our means. While we were tempted, we never bought a vacation home, opting instead of just renting from those who had made that decision.

I do the yardwork, we share cleaning the house, so we try and optimize bringing in professionals, although I have no issues paying a trade for excellent work.

Wife is super frugal (I should have put that first).

Overall made some good financial moves: buy a few mutual funds, set it and forget it. I've paid cash for cars since I was 40.

Oh, and it sure doesn't hurt to have some RSUs from Megacorp that skyrocketed over my 7-year tenure there.

Now we're just shy of $6M not including the house, retired at 61 (a year off my target).

 

[2017ish]

Pretty simple in our case. Both of us had high paying jobs, and put as much into retirement accounts as we could from the beginning. (I took 15 years away from high pay to stay home raising the kids, but I still managed to max out 403b by taking next to no $$ home from my part time teaching gig.) No inheritance for either of us.

We lived well by our standards and lost almost two years income on our home and malpractice tail when we had to move mid-career,. Still, the retirement account contributions, always invested 100% in equities, grew enough that we retired in our mid-50s and spend about double post-tax (and excluding kid-related expenses) as we did when working.

 

[LateToFIRE]

Can relate to many of the stories here. Started with less than zero and "negative inheritance" as some have put it. Grew up in pretty rough circumstances - in a lot of ways I have defied some long odds.

Was an athletic top student, went to an elite uni on scholarship, loans and work-study. But the student loans (before that was the big thing it is nowadays) put me deep into the hole.

Wasn't until I was approaching 30 that I really got my career and financial act together, which not too coincidentally coincided with marriage.

From there on out, was mostly very long hours and hard work that laid the foundation of our prosperity. With the kind of commission/bonus type work I did you never know what you're going to make - so budgeting for the worse allowed us to bank the good years.

Sources of wealth came from multiple streams, a bit of everything: 401K/IRA savings from MegaCorp salary, annual bonuses, RSU's, stock options, business ventures, home equity, investment real estate, etc.

I'd say the strong incentive pay and regular savings made us millionaires before 40 - back when that was an unusual achievement - but it was the RSU's and real estate that were the rocket fuel that drove us into the 1%-2% NW (depending on who's thresholds you use).

 

[Gumby]

I will say that the work in which I was interested and capable of doing paid fairly well. Although it was often very, very difficult and stressful.

 

[sparky08]

Pretty boring actually. Max out 401K's and invested our savings.

Got a couple nice bumps from property values going up. Rolled those into a nice retirement home.

 

[Mr. Tightwad]

On a decent government salary, I purchased homes in LA county in '89, '92, '96 and '98.

Rented out three. Lived the frugal life, some would say ultra frugal. Never got married so didn't lose everything in a divorce.

Now still single and worth 4.9M thanks to rents and RE appreciation.

 

[Koolau]

36 years at same Megacorp. Maxed 401(k).



Also w*rked part time at family business (slave wages - BUT as part owner, the "dividends" were often quite nice.)


LBYM


Modest pension and now SS for both. SO far, more invested than when retired in '05. YMMV

 

[FLSUnFIRE]

Former cubicle denizen that LBMM and invested almost exclusively in boring index funds. NW is currently about 128% of my lifetime after-tax earnings.