"Your First Million is the Toughest" How long did it take you?

[tryan]

Quote:

If one starts with a small amount of savings, it is likely to take 25-30 years to reach $1MM.

Probably a big contributor to why most don't "make it" ... and another reason why those who "make it" rarely loose it.

[dessert]

We started saving in 1977. We crossed that mark last year not counting the home we own. We are not educated investors but Fidelity 401K gave us enough information to where we kept everything diversified and dollar-cost averaging did it's job. We paid for our home, always owned two nice vehicles and a new boat, so we are not misers at all.
Right now we are saving a good bit each month and the way the market is moving, we are now 15% on the way to the second mark.

[megacorp-firee]

Not quite sure... I was 'nose to the grindstone' and looked up one year (I think it was 1998(after 21 years of working) and found that I had $1M in total investments, not counting the house). So I thought I was on track. Then 2000 came along and my portfolio dropped like a rock ... I was in my 'gambling' mode back then, 100% equities. I angonized about that for a while and then went back into 'nose to grindstone mode'. Well fortunately I just kept on investing the max in 401K through those years and left my hand off the throttle. 2003-4 and stuff is back on track. 2005 I got religion and saw the light at the end of the tunnel, so I started to get conservative. Instead of 100/0 allocation I am now 60/40. ... getting close to 2nd $M, but now I'm off the 'corporate teat', it will grow a little slower I think. ... my 'working' spreadsheet (wishful thinking and unscientific) shows that I will be at over 8M when I reach 100 years old @ 6% annual growth rate. Hope they have 'body parts' at Wal-Mart by then.

By the way ... 19 days into retirement and I am wondering why I waited so long... MAN THIS IS THE WAY TO DO IT!
Sorry .. devil made me do it.

[yona]

Took me 7 years since I took my first full time job. We don't earn a lot and I am not smart, but:

- I live frugally
- I listen very well to what Buffett says

[UVaOK]

Quote:

Originally Posted by yona Took me 7 years since I took my first full time job. We don't earn a lot and I am not smart, but: - I live frugally - I listen very well to what Buffett says

How did you get to seven figures in seven years without earning much money? This seems pretty difficult. Even if you had started with $100k, you'd need an average annual return of almost 40% to get to a million in that time frame.

[yona]

During these 7 years our combined salaries averaged around 80K to 90K a year. I never really calculated it, but this is my estimation. I think we saved more than 50% of it. The taxes in HK are very low and there is no capital gain tax nor dividend tax.

My investments were OK, but not that great until two years ago, when I read Buffett saying he can guarantee more than 50% a year if he had less than 10 million to invest.

I just followed what he did when he was young. My last year's return was 48%. Above this I used some leverage (100K), which worked for me.

This year I didn't borrow money, and my return YTD is more than 80%. (This is just an estimation. By the end of June it was 71% and it is up a lot since.)

[Sam]

Have you contacted Warren Buffett lately? He's looking for someone to take over his responsibity.

Anyway, the performance of your portfolio is simply amazing, almost unbelievable. Congrats.

[JustCurious]

Quote:

Originally Posted by yona I just followed what he did when he was young. My last year's return was 48%. Above this I used some leverage (100K), which worked for me. This year I didn't borrow money, and my return YTD is more than 80%. (This is just an estimation. By the end of June it was 71% and it is up a lot since.)

Yona, would you share with us the specific investments in your portfolio? I would love to see how you are earning such terrific returns!

[free4now]

About 10 years to pre-tax million, 15 years to post-tax million.

[Milton]

Quote:

Originally Posted by JustCurious Yona, would you share with us the specific investments in your portfolio? I would love to see how you are earning such terrific returns!

I want to say one word to you. Just one word. Plastics.

[retire@40]

Quote:

Originally Posted by Milton I want to say one word to you. Just one word. Plastics.

OK, McGuire.

[chinaco]

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Originally Posted by yona During these 7 years our combined salaries averaged around 80K to 90K a year. I never really calculated it, but this is my estimation. I think we saved more than 50% of it. The taxes in HK are very low and there is no capital gain tax nor dividend tax. My investments were OK, but not that great until two years ago, when I read Buffett saying he can guarantee more than 50% a year if he had less than 10 million to invest. I just followed what he did when he was young. My last year's return was 48%. Above this I used some leverage (100K), which worked for me. This year I didn't borrow money, and my return YTD is more than 80%. (This is just an estimation. By the end of June it was 71% and it is up a lot since.)

If I were that lucky... I would not press my luck too much further. I would be be getting less risky quickly. Otherwise, the market gremlins might take it back!

[Spanky]

Quote:

Originally Posted by chinaco If I were that lucky... I would not press my luck too much further. I would be be getting less risky quickly. Otherwise, the market gremlins might take it back!

Don't worry- yona is a market genius.

[Webzter]

Quote:

Originally Posted by Milton I want to say one word to you. Just one word. Plastics.

I've got plastic in my wallet and casually noticed a woman jogging the other day who seemed to have plastic in her chest area. Which one should I be concentrating on more?

[yona]

Quote:

Originally Posted by JustCurious Yona, would you share with us the specific investments in your portfolio? I would love to see how you are earning such terrific returns!

My biggest holding now is 0878.hk. It is a RE company in HK, which is traded at around 1/3 of its NAV. I started buying at 2.87 when it was only 1/6 of NAV.
My DD shows me that there is nothing wrong with this company and Mr. market is wrong here.

Few others that I own most of them up a lot since I bought but are still cheap:
0212.hk - NAV is 40$ but the stock trades at around 20$ (I bought at 12.5$)
0896.hk - NAV 1.4$. Current price 1$. Also very low P/S
1047.hk - Very low P/B and P/S
0141.hk - Very low P/B and P/S

In the last two years I found 3 stocks that traded well below net cash. All of them were big winners - 1046.hk, 1149.hk & 0379.hk
It is amazing, because all 3 were cash free positive. 1046.hk & 1149.hk were really cash cows. The P/E of 1149.hk was less than 2 when I bought it and it was growing more than 30% a year. I still hold this one. Its already up more than 3 times since I bought, but its PE is just 5.

All of these stocks are in HK, you can check them here:
www.hangseng.com

And read the reports here:
Search

[yona]

Quote:

Originally Posted by chinaco If I were that lucky... I would not press my luck too much further. I would be be getting less risky quickly. Otherwise, the market gremlins might take it back!

I guess I was lucky to be in a place were there were so many stocks that traded at low single digit PE and well below book value.
From time to time I do tell myself that the returns these 2 years were too good to be true and I need to take the money and run. But then I take another look at my stocks, and see how cheap they still are - most of them well below NAV. I don't see any reason to sell and buy more expensive stocks.

When my stocks reach NAV (for RE companies) or P/S of 2 (for industrial companies) I start getting nervous. But there is still a long way to get there.

[obryanjf]

Hit and unhit 1MM last year or early this year after 18 years. no windfalls, few options, no huge winners.

Currently over and close to FIRE.

job

[Alan]

yona, I think you should change your handle to yoda - clever you are

[old woman]

Quote:

Originally Posted by Milkman Motley Fool recently did an article titled "Your First Million Is the Toughest." Your First Million Is the Toughest It talks about how long it takes to accumulate your first million, and then the second, and third, using the criteria of monthly savings and rates of return. Recently there was a thread asking people if they had recently surpassed that major milestone. My question is; from the time you seriously started to save for retirement, how long did it take you to accumulate your first seven figures? I am in striking distance, but I have been working at it for 25 years. No windfalls, no stock options, just one paycheck at a time. Milkman

I started saving in April 1984 when I got divorced and bought my first IRA for $2,000. But I am far from my first million and will probably never have a million. I got to 420K so far it may seem tiny but I had started with nothing and even put myself through two years of college at a private school in that time and bought two houses. The current house has a few hundred thousand in equity maybe 300K so my net worth could be over 700K and when I sell this house I could buy a cheaper one for cash. But my money is snowballing right now my net worth has gone up 100K in a year not counting house appreciation just investment income and what I save out of my pay so if I work 3 more years I could maybe have a million.

[Lyle]

In 1984 I move to a new company and remember having 10K in a retirement account. I hit 1M net worth in 2006 and will hit 1M in liquid assets in 2007. It took a while but considering during this time raised a family, put two kids though college, learned about the stock market (2000-2003), it worked.

Not sure how much was me and how much was persistence and luck though.
Lyle