The First Year I Broke 200k

       Well, let me start with saying I started this blog in February of 2015, this is a passage from what I wrote:

"As it says at the top of the blog, I'm not a millionaire, I also likely never will be. I want the money, don't get me wrong, but I don't want to be a millionaire, the work involved would mean giving up things I love more than money. However, not only have I worked with millionaires, but I have worked with and met some of the richest people in the world, not the city, or the country, the world... read on...."

In June of 2019 I added, I knew that was likely going to change... Throughout now over 20 years of learning, investing, losing a lot of money, and making a lot of mistakes, I can say I now have a net worth I never dreamed of having. This year I am going to clear 200k. I don't make an incredibly high hourly wage at my job, but I do blood hours, which is a term I made up but is pretty self explanatory. I also consider myself, a decent investor as something around 20% of my income was from stocks or real estate. Now that being said, I want to bring to light something, $200,000 a number so unimaginable many years ago (and sadly also not as good/valuable as it was years ago)... But I can honestly say:

MY OVERALL LEVEL OF HAPPINESS IS NO DIFFERENT AT 200K THAN IT WAS THE YEAR I BROKE 80K.

Now don't get me wrong, you worry a lot less about financial things, and 200k is WAY BETTER than my 2 figure bank account life in NYC.... But it's not everything.... Large unexpected bills still will frustrate you. Small losses still frustrate you, people ripping you off even when you can afford it annoys you. You go on cool vacations, but again, your $2,000 back packing trip to Europe in hostels is just as much fun as your $7,000 resort stay in Jamaica. This is not to say we shouldn't always be pushing ourselves to do better, because I'm not going to stop, I will try to get 300k, but I also want to make sure I don't lose myself, and the things I love doing in the meantime. 

At 200k I have now done things I never would have at 80k, I flew in vintage planes, some of which I've flown myself, I flew business class, I bought a giant t rex statue for my backyard, $100 bottles of wine,  $330 bottle of champagne, things that I would have never done before I had a greater level of financial security. BTW I paid my mortgage off for new readers otherwise I would have never done this shit.... But lets take it back to when I had a two figure bank account in New York...

When I was flat broke I taught myself to flair bartend, the art of flipping bottles to make cocktails, I taught myself this because I bartended, I needed more money, and it was free to start, you just needed an empty bottle, as I got better and broke a few I bought a $20 flair bottle to practice easier and not annoy the neighbor below with a glass breaking sound. At some point in life flipping the bottles really brought me joy and satisfaction. Now again, flying in B17 bombers, drinking designer champagne etc.... That $20 bottle I had still brings me joy. It still brings me joy to make drinks for people with flair, or to do it myself while I'm home, and it costs absolutely nothing at this point. The 200k didn't change that and never will. 

    I am not saying don't push yourself, ALWAYS push yourself. Jeff Bezos still wakes up and goes to work, Elon Musk, Warren Buffet etc. None of them need to, we can always better ourselves and ideally change the world for the better with it. But also be realistic, be realistic about what you are working for and what the money is going to change. It's a good change, but it's not a "be all end all" change to who you are and the life you have left in front of you. What me, you, and the richest people all have equal of, is the time we have left on this world, make money, but also make a priority of treasuring and savoring that time. 

"I've got a lot of issues in life but money is not one of them"

     So this is gonna be off topic for this blog... or maybe exactly on target. I'm in a position now where I may truly be a millionaire by age 40. And it's a great feeling, but I also have come to the realization that it's not the happy ending I thought it would be. $1 million is not anywhere near enough to retire in the USA but it is plenty to retire in other beautiful amazing countries. But I find this odd sense of incompleteness.... If I stay in USA

     A friend recently posted on Facebook how she was very upset at age 31 she has not yet cleared 100k... I really didn't wanna be arrogant but I also really wanted to message her that I've cleared 100k for the last 9 years, and after taxes and investments, it's not all it's cut out to be. We all know deep down that good old phrase money doesn't buy happiness... I respectfully disagree with this... to an extent. When I was flat broke I was depressed, sleeping on piles of clothes, an air mattress, or a friends couch was not the best times of my life. I heard once that money does buy happiness but just to a level of about 70k a year, of course adjust this to where you live, 70k in San Fran you are border line homeless, in Mississippi you may be rich. As long as you have enough money to take a few trips a year, go out to dinner once or twice a week, buy some nice things, and not worry about day to day bills, you have reached your peak of monetary happiness. In my humble opinion.

    So now for me as I am approaching a net worth of 1 million I constantly find myself saying the title of this article.. "I've got a lot of issues in life, but money isn't one of them." 

So I May End Up Being A Millionaire By Age 40

    I started this blog with my very first post on the 9 Ladders To 1 Million saying how I may never be a millionaire, but we will talk about money and laugh at all the bull shit get rich quick schemes. I may have been wrong about the first part. As my finances are looking now by age 40 I may cross a Net Worth of $1,000,000. And I am currently still driving a 2006 Kia Rio. Unlike all the people selling shit, I am going to tell you here completely for free how I am getting to this point. I will admit that some of these are extremely hard,  others are extremely easy, and some of it was just luck... Here we go:

1.  Number 1 and probably the most important for me personally, was leaving New York City. This is one of the ones that I know is not easy for a lot of people. To leave your home town is a step a lot of people can't take and some on the other hand will easily take. When your rent is double your salary and a house is 20x your salary, it's time to take a good hard look at your career choice and if that is the career you want you really need to ask if this city is the best place for you to prosper financially from doing that job. A guy working a city job in a small town can buy a house for about 150k and invest in the same exact funds as the guy in NYC making 200k but paying 5k a month for an apartment and getting taxed to death.
   
2. Drive a shitty car. I've killed this to death in this blog. Very few people need a nice car or a truck. You can rent a nice car if you need to take clients out or borrow a friends truck to move shit or go camping. I also walk or bike whenever, it's more for health purposes, but it's definitely helped extend the life of my shitty car.
   
3. I got lucky buying my house. My house is about 40% of my million net worth valued at about 400k. It wasn't total luck, I found a great affordable market through hard research, the luck part was how much it went up, which now is about 65%.
   
4. I lived with and still live with roommates at age 37. Roommates suck. Well some do anyway, age 37 may be too old for roommates, but for me age 60 is too old to be working. I am aiming for early retirement. 8 years of having roommates at a cheap rent of 500 a month made me $96,000.
   
5. Making extra payments on my house. I didn't put an extra 100 or 200 here and there. I slammed my mortgage, especially in the beinginning when interest was very front loaded. This saved me over 100k. Don't even think about telling me the bull shit myth that a paid off house loses your tax break. YOU PAY 10K IN INTEREST TO GET 1K BACK!!!
   
6. 2nd jobs, 3rd jobs, and overtime at job 1. Unless you are naturally in the top tax bracket or fall into one of the millionaire categories I have blogged about in the past you are going to have to work your ass off or be part of the 9 Ladders to hit $1,000,000. My top overtime year I worked over 1,000 hours on top of my normal hours, that's 25 extra weeks of work if it was a 40 hour work week. I literally put myself into the hospital from working too much, and btw I am a blue collar worker. This blog and ebay sales are the only money I make from sitting behind a desk, and generally I don't make shit from them. My sides jobs were everything ranging from bartender, waiter, personal trainer, construction, and driving for eats delivery apps because my shit car was too old to drive for regular Uber. Some of my side jobs didn't remotely compare to my normal salary, but if I wasn't at my normal job I didn't want to waste time I could be making money. I even have been known to walk through my alley looking in the trash for shit I can sell on eBay.
   
7. I don't have kids or a wife. I love kids and maybe I will get married some day. But to be fair to all readers I do have to admit this was and is a huge advantage for building wealth. Don't get rid of your kids or call off the wedding, just know realistically it costs money to do both. Unless... you marry a sugar spouse :)
   
8. I'm cheap... somewhat. I buy my clothes mostly from outlet stores, I shop deals, I keep shit until it breaks down beyond repairs etc. But to give hope here, I also did in the last 10 years spend an average of 7k a year on travel. I write a travel blog too, and my short thing on this, you want to be financially secure, and have a comfortable future. But you can't totally miss out on the now for it. It's just a matter of budgeting your savings first then the fun shit.
   
9. I switched my whole investments to mirror the S&P 500 fund. This needs to be another post on it's own. But for 10 or 12 wasted years age 23 to 33 I followed bull shit advice on investing. Finally after reading up on some common sense I switched my main 401k to mirror the S&P. I make risky investments with other accounts but not with my main retirement account. 

   Anyway there's probably some other shit I forgot, but there you go. I'm a 3x college dropout, with no skills other than hard labor. The money is out there if you are willing to do the work.

It Takes 25 Years To Become A Millionaire, To Get 2 Million Will Take About 7

It Takes 22 Years To Become A Millionaire, To Get 2 Million Will Take About 7

Just let that sink in....


      The power of compounding interest is amazing. When I talk to new young investors, I tell them that when you begin to invest in a 401k it's really no fun, the first year your account builds up to $4,000? Maybe $10,000 if you really hit it hard, and each month you look into the account you merely see a few more dollars in value, maybe a hundred more some day, maybe worse a big dip. It's not really that interesting. And for me during this time there was no interest in learning more about the magical market. I'll probably tell this story 100x over on this blog, but when my account finally hit $95,000. I got very excited, I waited... and waited... and waited... it was then I learned my investments were terrible. I got smart and changed my strategy and of course it hit 100k shortly after that.

     What did I learn? I learned about the investments I was making, and of course compounding interest. $4,000 going to $5000 in one year is not really interesting, but $110,000 going to $120,000 in one month is pretty damn interesting to me. You have to stay in the game LONG to profit. The stupidity of believing ANYONE can make significant money in months or a year is a terrible crutch to lean on. Of course there will ALWAYS be over night millionaires. There will always be someone who has the right youtube channel at the right time, that sells the right product at the right time. and I'm not saying we shouldn't strive to be that lucky dude. But we also need to have a realistic plan. Time and time again, compounding interest has made middle class into millionaire class.

     Let's take a look at a guy or girl who makes 70k a year, he invests $10,000 of his money for 10 years in his 401k..

That $10,000 compounding at a rate of 10% becomes $175,311.67 after 10 years. He or she has advanced in his or her career, has a few side hustles now and can max out at $19,500 a year...

That''s $19,500 compounding at the rate of 10% for 12 years with the $175,311.67 base becomes $997,134.65... Round it up to 1 million to amuse me...

He or she continues to put in $19,500 at the rate of 10%, it climbs to $2,146,998.97 after 7 years.

Or you can buy stupid shit online and at stores you won't give a shit about after 1 month to 1 year. The decision is yours.

Why Do These Idiots Think A Mortgage Is Good For Your Taxes?

Today's rant....

Me: "So I've busted my ass and I'm gonna end up getting my house paid off next year. By my calculations I have saved about 90k on interest payments by making those extra mortgage payment."

Idiot I Am Talking To: "But wait, that's stupid, you are going to lose the tax deduction!!!"

     Nothing pisses me off more in finance than this conversation, which I have regularly, I'd say about weekly. Now don't get me wrong, there are reasons not to pay off you house early, the number one being, you can't. But others being your interest rate vs your investment portfolio, if it's a rental vs primary residence, and even these are disputable. But what is not disputable is this foul stinking pig shit that a normal guy or gal in a normal house with a normal job needs a mortgage for tax purposes.

     I bought my house, rather stole since it was during the real estate collapse with a mortgage of 180k. Minimum down with a 3.75 interest rate plus bull shit PMI. Running this through interest and PMI calculator the 180k mortgage would have cost me, the 180k principle, 120k in interest, and close to 20 fucking thousand in PMI payments!!! Total: $320,000.

     Now for the idiot I was talking/will talk to this week. The initial payments on the front end helped me reduced the bitch of a mortgage early to the point where I refinanced to a 15 but thanks to the extra payments when I refinanced my monthly was the same, on PMI alone I saved about 13k. I continued making extra payments and by the time I pay it off my total paid will be about $220,000 vs. $320,000. 100k saved. Now let's see why these idiots want me to not pay if off for tax purposes...

     Running my info through this site: https://www.bankrate.com/calculators/mortgages/loan-tax-deduction-calculator.aspx which is stupid in itself as it propagates this is a good idea rather than simply telling the person the tax savings is a myth vs early payoff, it tells me my first year tax savings would be $2,633. Wow..... I would get $2,633 back! Whoohooo.... What's the problem then??? Hmmm.... let's see idiot, YOU PAID ALMOST $7,000 IN INTEREST. You are paying $7,000 to earn back $2,600 and you think this is a good idea???

      Let me tell you about a better idea, it's called the Mortgage Lottery, you've played lotto before right? My game the Mortgage Lottery is similar. You just bought a new house with a 30 year mortgage, but got an extra $3,000 somehow you weren't expecting. You put an extra $3,000 in the mortgage it's like a lottery ticket, only difference is that it is 100% guaranteed you win back at least $3,000. You save that money on mortgage interest and you pay down the principle. Why on Earth if you can would you not do that rather than pay double to get back a third???

      If you don't believe me by all means, run your own numbers, and stop listening to these idiots!!!!!

The Best Financial Advice You Will Read Today (if you are single)

DON'T GET MARRIED

     Now if there are kids involved my personal feeling is to give marriage a chance or at least live together and give that kid a chance at being raised by two parents, but if there is no kid involved....

     There is no worse investment you can make than marriage, the cost of the wedding compounded in a simple index fund account is likely enough to pay for your retirement cottage, or maybe even your whole retirement with the way some people spend money on weddings. Divorce is at it's all time highest rate ever. You lose control of your finances. You split income, property, dividends, etc.

     Stay single, and live together, likely more happily ever after than the other way around.

My Net Worth Just Surpassed 1/2 Mil... What Kind Of Car Am I Driving?

       Well I guess I'm lying in the title... it didn't just surpass $500,000, I think I hit it somewhere mid quarter, anyway, point is, old faithful, my shitty blue 2006 12 year old Kia Rio is still my go to for the hustle and bustle of life. I bought this bad boy brand new for $11,000 in 2006 and it has lasted me since. I have never had a car payment on it as I bought it with cash I saved rather than on credit.

     As Americans one of the number one, if not the number one thing we misspend on is our vehicle. I have written about this in the blog before, take public transportation, I did it for 25 years, car pool, or if you must buy a car. I'm not even gonna say buy a car you can afford, but a car that is significantly below what you can afford, but of course one that runs good, has cold AC if needed, or basic comforts. No need for the tons of extra crap, or high end luxury that we can't afford. And I don't mean we can't afford the car, I could easily afford a Mercedes or a Lexus right now, what I can't afford is to lose the gains on my investments by investing in something that loses up to 20% value the second you drive it off the lot.

     The car gets me from A to B. You would be amazed at what I have transported with it with some creativity. Sometimes I have borrowed my friends truck admittedly to transport building materials and paid them with lunch or a case of beer (much cheaper than a truck payment). I keep the interior very clean and installed a more modern radio myself which makes it a little better for when I am driving friends, family, dates, etc. By not having a car payment for 11 years I have been able to travel throughout 44 countries, own a home, soon to buy a 2nd property, 3 retirement accounts, and now yes, my net worth is over $500,000.

    Don't fall into the car trap. Invest safely, and invest wisely my friends.