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Originally Posted by Henry  Good info. How old are you now Matt? Millionaire status at 28 would be phenomenal. |
I've got another 6 years to go, which simultaneously seems like forever and a very short period of time. I'm currently not rich by any stretch of the imagination, but my net worth is at least positive (an accomplishment for any student) and I am planting the seeds of high income in the future.
The frugal point is very interesting as it illustrates another funny thing about money. The term millionaire is rather insufficient. To attain a million dollars net worth in a reasonable period of time with a slightly above average income (say $70-$100K) requires great frugality. To keep that money requires slightly less frugality (standard 10% return on investment assumption applies here - hence $100 000 return per year, of which $10 000 - $30 000 must be re-invested to combat inflation, so you have about 70K extra per year you can now spend and your net worth can retain the same buying power it had last year). Hence you can be a millionaire and live a very average lifestyle - perhaps with a nicer car and an extra bedroom in the house.
Compare this to another type of millionaire - the one whose net worth is currently also a million dollars... but this time it's a CEO who makes $500 000 after tax per year. Same amount of money in the bank, but with the expectation of far more money per year than the first millionaire. This person can clearly afford a much more lavish lifestyle, even if he/she spends it 100% on consumables each year and doesn't use it to increase net worth (ie even after completely wasting $500K a year on wild parties this person retains the millionaire label). The lesson is that ultimately the amount of income you make per year (be it employment income, investment income, or jewel heist income) will play a big role in determining your possible lifestyle. When we think of millionaire we tend to think of the second type, but in reality simply knowing that someone is a millionaire doesn't tell us a whole about the kind of lifestyle they can afford to live. Income is very important.
And early rising is indeed part of the plan for success
I get up between 5 and 6 every morning, parties excluded. It's 7:30 now and I've already showered, had breakfast, and solved a horrendously annoying JavaScript problem.