I saved over $300,000 in my 20s and everyone seems to ask the same 7 questions

  • So far, I’ve saved $330,000 in my 20s and hope to quit my job by age 35. I share my exact net worth and investing strategy every month on my blog.
  • Sharing this goal has led to thousands of questions from my blog’s readers, but these seven questions — including “Do you live in your mom’s basement?” and “Did you get lucky with bitcoin?” — are the most common.
  • Read more personal finance coverage.

Have you ever told someone your deepest secret, and the confession led to a barrage of questions? Now imagine you confess that secret not just to one person, but to hundreds of thousands of people. That’s the shock I was in for when I decided to create an anonymous blog sharing my unusual money plans.

You see, I created my blog after saving up $100,000 as a 25-year-old. Now 29, I’ve saved over $330,000. The end goal? Quit my job by the time I’m 35.

Yeah … those three sentences stir up a ton of questions.

And thanks to my position as a blogger with an open inbox, I get to see exactly what those questions are. Through hundreds and thousands of emails with readers, I’ve built up a collection of data that would make Facebook proud — data that includes some very clear patterns of questions about my finances.

Here are the seven most common.

1. How exactly did you save up so much money so fast?

A question with a three-part answer!

  1. An early interest in finance
  2. Brute force savings
  3. Compound interest

I’ll explain.

After reading a few books about money at a young age, coinciding with the shocking discovery that my grandfather had used his five-figure, blue-collar earnings to invest his way towards a million dollars by retirement, I decided early on that it was my mission to save (and invest) as much money as possible.

I opened my first investment account at age 16, with just $500 of earnings from the sort of low-paying job you’d expect a 16 -year-old to have. I continued to sock away a little bit of money here and there, despite competing interests from puppy-love romances and eventually, college binge-drinking obligations.

By the time I graduated college, those part-time earnings, mixed with the “buy-low” prices of stocks from 2009 to 2013, had compounded to around $25,000.

I accepted my first entry level job out of school, earning a $50,000 full-time salary. From there, I maxed out my retirement accounts and continued saving as much money as possible.

2. Okay, so then how much do you make? And how much do you save?

I spent the first two years after graduating college earning around $50,000 with my entry-level finance job. I saved around 40% to 50% of my take-home pay during this time. (For the record, here’s the best way to calculate your savings rate, in my opinion.)

At age 27, I hit a promotion that jumped my annual salary to around $70,000. At age 29, I hit another promotion that pushed the salary into the high $80,000s for the first time.

I only spend about $24,000 to 27,000 a year, meaning I usually save over 60% of my income.

3. How do you save so much? Do you live in your mom’s basement?

Maybe the most common question I get! I think I could start a stand-up comedy tour with all the “mom’s basement” jokes I get.

But I need to make this very clear. I do not live in mom’s basement, and I never have. (Not that there’s anything wrong with that, Mr. Seinfeld.)

Through college, I split a messy four-bedroom bachelor pad apartment with three other dudes who barely even took out the trash. When I graduated, I vowed to find my own place, which I did in a Denver suburb for $800 a month.

Over the next two years, that $800 rent skyrocketed to over $1,100. At that time, I decided to pack up shop and move to Minneapolis. I made the choice mostly because of my future fiancé’s choice in graduate school, although the lower cost of living ended up being a nice bonus.

In Minneapolis, I moved in with said future fiancé, and we split a $1,200-a-month rent for two years. Eventually, she found a modest $180,000 home in a neighborhood “below our means” yet absolutely perfect for us.

We made the decision to purchase the $180,000 home despite qualifying for a $500,000 mortgage. We knew that housing is the single largest expense in the average American budget, and for us, the freedom of being able to continue saving and spending how we wanted far outweighed the need for extra bedrooms or an impressive zip code.

Two years later, we’re still splitting that dirt-cheap mortgage together, and we’re getting married this summer.

4. What’s your investment strategy? Did you get lucky investing in a specific stock or bitcoin?

No bitcoin for me, although that’s a sore subject. (I thought it was overpriced when it was $100 a coin … )

No exceptional luck in the stock market, either. 

Probably the luckiest thing I did was starting to invest early, and then continuing to invest consistently since then. This allowed me to ignore all the doomsday hype during the financial crisis of 2009, and then again in 2015-2016, when everyone said the market was ready for another crash. Instead, I just kept investing in something resembling a three-fund portfolio, and now I’ve got the healthy sized collection of index funds to prove it!

5. How are you going to quit your job when you’re 35? Most of your net worth is tied up in your 401(k).

True. I’ve been maxing out my 401(k) almost every year since I entered the workforce. Great for building your savings and reducing your tax bill … not so great for actually accessing your money before age 59.5 years old.

Many curious readers ask me how this fits with my strategy of leaving the corporate world by age 35. Other readers don’t really ask me about this; they go straight to reminding me that I’m an idiot for even considering leaving a well-paying job before the IRS’s golden age.

Here’s my two-part plan. Just hear me out.

1. You can actually access 401(k) money before you’re 60 years old

The most common strategy involves what’s called a Roth IRA conversion ladder. A full explanation of this process will give you reading for days, but the gist of it is pretty simple. You first convert your 401(k) into a Traditional IRA, then that Traditional IRA into a Roth IRA.

Carefully doing this while navigating a few specific IRS rulesallows you to withdraw your 401(k) money when you’re young, penalty-free. 

2. When you save for the future, you actually allow yourself to live in the moment

Most people get this completely backyards. They live in the moment, which kills their ability to save for the future.

My plan is to flip that script. By sacrificing a few years when I’m younger (and also when I happen to have fewer responsibilities) I am building a financial foundation that will last a lifetime. 

In this light, my 401(k) account becomes my “old man money.” And with old man money taken care of, you can spend the majority of your life doing what you want.

Let me explain.

So far, I’ve saved and grown my 401(k) and IRA account balances to a little over $160,000 at age 29. Even if I stop contributing to those accounts tomorrow (unlikely) how large should that balance grow over the next 31 years? (We’ll assume 7% stock market returns — the historical inflation-adjusted average.)

It would be $1.3 million dollars by age 60.

In this light, a few years of saving in my 20s completely handles my savings in old age. Which means at a certain point, I’m free to earn a basic living wage, without worrying about saving a penny more. This opens up a freedom that most people, still trapped in the grind of climbing the corporate ladder, can only dream of.

6. What are you planning on doing when you ‘retire’ at age 35?

Nice use of air quotes, question man.

After all, I’m planning on making my big move while still in my 30s. In other words, I think I’ve got a whole lot more to offer the world than sipping pina coladas on the beach for the next three decades.

So, I’m planning on embracing what I call “hobby employment” from age 35 to 60.

Hobby jobs are the types of jobs you’d probably do for free. The pay is just a nice bonus.

For me, this includes things like coaching a baseball team, becoming a ski school instructor, or working on my freelance writing portfolio.

Not only are odd jobs like this a whole lot more fun than sitting in a cubicle, but it also helps me avoid touching my “old man money” in the form of my 401(k) and IRA. Plus, I’m a really a big chicken when it comes to spending my savings, so it’s nice to have the added income source as a backup plan to my other income streams.

7. Good for you. But I like my job, and quitting at age 35 sounds a little crazy. Why should I care about saving money?

Because things change. What was once a dream job can quickly turn into a daily grind, especially when your lack of finances limits your options.

And even if you love your job today, that job can change tomorrow. Layoffs can happen, and job titles change.

Saving money gives you options. Options to take an extended vacation, find a lower-paying job, chase a dream, or for a lack of a better phrase … do whatever the hell you want.

With that in mind, why wouldn’t you want to give yourself freedom?

Sean, who goes by “The Money Wizard,” is a 29-year-old blogger and financial analyst. He grew his net worth by more than $100,000 in two years and is on track for an early retirement.

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