Why so many 40-something millionaires?

[youbet]

Philosophically, I think some of the best things you can do for your kids don't cost anything other than your time and attention.

Take note our kids are still young (both will be in elementary school this fall), and so I could be in for a very rude awakening (and I have budgeted for this to a certain degree). But we also live in a moderate income area ("gentrifying area") so our kids don't see lots of spoiled rich kids surrounding them all day (another benefit of living in a moderate cost neighborhood and going to schools with a high proportion of low income students).

Yes, you could be in for a rude awakening........

Raising our family cost us all our money and a little more. Briefly empty nesters, we now have the grand youngin's to take over looting the bank of Gramma and Papa! Kids and grand kids can consume an infinite amount of resources.

But in the end, raising the family just sets the bar a bit higher on the way to FIRE, just another expense to account for and take care of. And, for us, the rewards are well worth it.

 

[FinanceDude]

Yes, you could be in for a rude awakening........

Raising our family cost us all our money and a little more. Briefly empty nesters, we now have the grand youngin's to take over looting the bank of Gramma and Papa! Kids and grand kids can consume an infinite amount of resources.

But in the end, raising the family just sets the bar a bit higher on the way to FIRE, just another expense to account for and take care of. And, for us, the rewards are well worth it.

Well said........

 

[scrabbler1]

Nice list, Chinaco.

I would add one more item to that list, perhaps an offshoot of items #2 and #7:

More and more people making the fine choice to be childfree (i.e. lower birthrates), thereby avoiding the financial downside of having kids, contributes to increased personal wealth. No chance I could have ERed if I had kids. No chance I'd have $1M saved up by age 47 (last year) if I had kids.

 

[FUEGO]

Yes, you could be in for a rude awakening........

Raising our family cost us all our money and a little more. Briefly empty nesters, we now have the grand youngin's to take over looting the bank of Gramma and Papa! Kids and grand kids can consume an infinite amount of resources.

But in the end, raising the family just sets the bar a bit higher on the way to FIRE, just another expense to account for and take care of. And, for us, the rewards are well worth it.

Agreed - kids are worth it. Spending remains a choice, and of my budget line items, kid-related spending represents the most uncertainty (more than health care/health insurance!).

Overall, I don't see kids as an impediment to FIRE status.

In addition to everything Fuego already mentioned, think of the DINK entertainment alternatives that parents miss out on:
- frequent golfing or SCUBA diving or other cash-heavy hobbies
- bar-hopping or dining out whenever you feel like it
- weekend trips to anywhere/everywhere
- serial home remodeling & landscaping

Can't agree with this enough. Sure, kids cost something, but I regard it as a spending shift instead of an outright increase in spending for the reasons you mentioned. We like to travel, and we would undoubtedly be taking a lot more long weekend trips and week long vacations but for the kids. Now kids fill up our free time in a usually positive way ("whaddya do all day").

And having kids provides huge motivation for me and DW to FIRE because we want to spend more time with them. We also look forward to not being exhausted and mentally fatigued from work so that we have more energy to interact with them.

 

[Nords]

We also look forward to not being exhausted and mentally fatigued from work so that we have more energy to interact with them.

That was one of the biggest improvements of my ER. Suddenly the whole family seemed willing to spend more time with me...

 

[Trawler]

$ 1 Mill Net reached at 45 1st time . Today at 50 $1.6

Educated

DINKS

Bought first home at age 23. All interest paid offset from apprecation in total of three homes.

Told mom when I was 15 I would be a millionaire by 30 so just a little late.

Maxed 401Ks

When We Got a raise saved 50% of net and had fun with the other.

Bonuses after tax saved 75% spent the other 25%

Never paid a dime in credit card interest.

Made car payments to my self then paid cash for cars.

Grandfather told me once never pay the Bank have the Bank pay you stuck early on.

Essentials always bought on sale.

Always asked for discount.

Save 1/3 spend a 1/3 and give the govt and charity 1/3 whole career.

Lived along the way Sailboats Vacations and Fine Ddining.

 

[green night]

This is a great thread!

39 ... will be 40 in a few months.

We're bouncing around the million mark. I told my wife that we'll celebrate once we're comfortably over the mark. A bad week in the stock market will put us below the mark.

Some of our keys:

3 kids. And yes, kids are pretty expensive ... now were in the travel baseball and basketball

Until a couple years ago, we were both cheapskates. We no longer worry about a few dollars here or there

No expensive or real bad habits. I do Drink some beer and do little bit of gambling but not extreme.

We buy 2 year old cars and drive them for until they're about 8 - 10 years old

I always do 3, 5, or 7 year ARM mortgages. Save $ now and role the dice that interest rates won't go up a great deal. I take the risk vs. the bank.

The last few years, I've made a good salary ... with bonus 150 - 190 ... prior to that though i was in the 80- 100 range. Wife has worked part time 1 to 2 1/2 days per week. Bringing in 10 - 20 per year. Mostly a stay at home Mom.

made no more than about 100k off stock options

always maxed the 401k and iras out

5 - 6 more years and i'm likely gone. Looking for 2MM ... wife will continue to work part time for the insurance.

 

[Blackwoodt]

I feel a nice kinship with the people who've replied in this list. We wear clothes for a long time, drive cars for 20 years, take cheap camping vacations, and really enjoy life.

+1

Some of my fondest vacation memories have been camping!

We don’t keep the same car for 20 years because of the miles I put on a car, but we are not picky about what kind of a car we drive as long
as we get a good deal on a car that has very low miles preferably from the original owner, or estate.


I’m on my second Saturn 3 door coupe. A 2002 bought 2 years ago with 4,500 miles for $6,500.00. After selling my old Saturn with 120,000
miles on it for $2,5000 my new car was relatively cheap! I’ll probably need another car next year after I retire, by then this little Saturn will
have as many miles on it as my old one did.

Too bad they no longer make Saturn’s, good little cars.

 

[stoutboy]

Are there really so many 40-something millionaires? As someone already pointed out, only 6% of the US population has a net worth of one million. And I'd wager the majority of those are significantly older than 40. I also would propose that a lot of people you may think are millionaires really aren't. They're just living the lifestyle--but it's all on credit. That, after all, is the American way.

As for me, I'm in my mid-40s and only about 3/4 of the way there. If I play my cards right, I may top the mark in as little as 3 years--but as another person pointed out, a million doesn't mean what it used to...

 

[njonge01]

1. enjoying a good salary;
2. living below my means;
3. no kids;
4. no debt;
5. never married.

this is me... plus some hyper-aggressive investments. Looking to shift gears. I have 1.8 Million and want to semi-retire within the next 12-24 months.

 

[njonge01]

Are there really so many 40-something millionaires? As someone already pointed out, only 6% of the US population has a net worth of one million. And I'd wager the majority of those are significantly older than 40. I also would propose that a lot of people you may think are millionaires really aren't. They're just living the lifestyle--but it's all on credit. That, after all, is the American way.

As for me, I'm in my mid-40s and only about 3/4 of the way there. If I play my cards right, I may top the mark in as little as 3 years--but as another person pointed out, a million doesn't mean what it used to...

It amazes me how many people I see living a lifestyle much larger than mine who have zero, zilch nada in their savings.

 

[fancy free]

As someone already pointed out, only 6% of the US population has a net worth of one million.

Make that 9 percent.

 

[skyvue]

Make that 9 percent.

I wonder how many of those people would not be millionaires if you excluded the value of their primary residence? I personally do not think it should be considered because you have to live somewhere and that is not an asset easily turned into cash these days.

 

[stoutboy]

Make that 9 percent.

I wonder how they arrive at this number. Anyway, I agree with a later poster: these figures are misleading, because they include primary residence home values in the calculation--and I doubt all these people own their homes free and clear.

 

[stoutboy]

I wonder how many of those people would not be millionaires if you excluded the value of their primary residence? I personally do not think it should be considered because you have to live somewhere and that is not an asset easily turned into cash these days.

I completely agree and I do not include this when calculating our net worth.

 

[SandsofTime]

What a joy to feel the kinship with all the posters here. We reached $1MM of liquid assets at 39. At age 30, we got married as penniless but well educated romantics. Wife and I have lived very much below our means, and crossed the 1MM mark about 8 months ago. Simple formula really: focus on savings, live below our means, enjoy simple pleasures.

 

[stoutboy]

What a joy to feel the kinship with all the posters here. We reached $1MM of liquid assets at 39. At age 30, we got married as penniless but well educated romantics. Wife and I have lived very much below our means, and crossed the 1MM mark about 8 months ago. Simple formula really: focus on savings, live below our means, enjoy simple pleasures.

I congratulate you, but it takes more than a simple formula. You almost certainly make a very decent household income to have saved 1 million of liquid assets in just nine years. More than 50% of Americans have household incomes of less than 50k per year. For these people, it's a question of decades if ever.

 

[Surewhitey]

We are 40 & 46 and just shy of our first $1MM; mostly liquid or stocks or 401k's.

We moved to Cali in 07 to take advantage of an awesome job and have saved $560k in 4.5 years. LWBM the whole time here and now we're moving to ER in Mexico to do volunteer work (and have some fun)...thought we'd give not-w**king a try.

We always lived on the lesser salary and saved the larger. Got the daughter through college, married & now its our time.
Eating in & driving modest cars always helps.

 

[amfox1]

What a joy to feel the kinship with all the posters here. We reached $1MM of liquid assets at 39. At age 30, we got married as penniless but well educated romantics. Wife and I have lived very much below our means, and crossed the 1MM mark about 8 months ago. Simple formula really: focus on savings, live below our means, enjoy simple pleasures.

DW and I say to each other that we married each other for our loans (since we had negative net worth). When married, we had $100k in outstanding school loans. Through good salaries, LBYM and a strict focus on repaying that debt, we paid it off within four years. Since then, we have continued to LBYM and save and invest aggressively. We reached $1mm in net worth at age 38 and continue to save and invest aggressively, including setting aside money for college for our kids.

Ultimately, it was our joint focus on LBYM and the power of compounding investments that allowed us to build our net worth. That was more important to us than trying to have the nicest house or car in the neighborhood or the newest toys. We want to retire early and enjoy the back nine, so to speak.

 

[Earl E Retyre]

For me, crossed $1M at around 40 due to stock options in a start up during the dotcom bubble.

Interesting thread!

 

[eytonxav]

I don't find this particulary remarkable. As for me, I can't even remember when we went beyond $1M. Everyones' perspective on the significance of $1M is different and as others have said it ain't what it used to be. While our kids were growing up, I was the sole bread winner and still largely am. I received a good education, was lucky with my career, did well with real estate, and benefited from some favorable market conditions despite being a pretty conservative investor. My only regret is that I should have been a more aggressive investor during my earlier years.

 

[wolfbay]

A million isn't very much these days. I've got a low-pay, dead-end job, and I need two million to even feel near ready to retire (cost of health insurance, etc.) I don't have near a million yet , but if I did, I'd only think I had a good down payment towards retirement....

Going by published stats it's surprising how few people have a million in investible assets. I guess if you include criminals and government people with annuities worth 1 mill plus it's a whole lot more common.

 

[stoutboy]

Going by published stats it's surprising how few people have a million in investible assets. I guess if you include criminals and government people with annuities worth 1 mill plus it's a whole lot more common.

I find your lumping of government workers with criminals quite offensive. Most government people I know are common, decent folk who deserve every bit of their annuities. I'd be happy to tell you where the real criminals are, but that's another thread.

 

[wolfbay]

I find your lumping of government workers with criminals quite offensive. Most government people I know are common, decent folk who deserve every bit of their annuities. I'd be happy to tell you where the real criminals are, but that's another thread.

Sorry to offend. Just pointing out that there are more affluent people out there than the stats show. My brother, sister and uncle all work for government and are hard working and competent. Who are the real criminals?

 

[swampwiz]

At around age 40 just after my divorce, my exwife left me with nearly $80,000 in various credit card and other debts ... After taking every dime I could muster up I paid off the debt in about 2 years.

Why didn't you just file for bankruptcy? As a bankruptcy filer myself (and an active member of a bankruptcy forum, as in here), it seems that most folks who have big debt simply file for bankruptcy to get relief? Did you not file because you felt it would be dishonorable?