swamp
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Post by swamp on Aug 12, 2014 10:27:10 GMT -5
I am curious - for those who count your house towards your "number" - how often do you adjust it? Are you counting as the price you paid for it? The assessed value? I am estimating what it would sell for. Estimating low.
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Deleted
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Post by Deleted on Aug 12, 2014 10:38:33 GMT -5
I really envy all the two income families. I should move into a little place that costs me like $300/month. ![](http://images.proboards.com/new/tongue.png) Then I could kick ass on the savings.
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swamp
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Post by swamp on Aug 12, 2014 10:43:45 GMT -5
Insider trading.
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HoneyBBQ
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Post by HoneyBBQ on Aug 12, 2014 10:46:38 GMT -5
I am curious - for those who count your house towards your "number" - how often do you adjust it? Are you counting as the price you paid for it? The assessed value? I'm counting my downpayment + maybe half of the 15% it's theoretically increased in value since we bought it 18 months ago (yes, Seattle is insane, they said prices went up 12% this year alone). In terms of reaching multiple millions, it's easier to get to 2 once you get to 1. My retirement account almost makes more money each month than I do.
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ken a.k.a OMK
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Post by ken a.k.a OMK on Aug 12, 2014 10:59:44 GMT -5
I don't count the house, you have to live somewhere. We own our house. Value is about $600k. We actually bought a second house for my MIL. There is a small mortgage on it.
Slow and steady for us. Money makes money. Made our first million maxing out our 401k's during the market down turn. Made our second million after retiring in 2010 and living within our means. Invested somewhat aggressively in mutual stock funds still. We may hit the mandatory withdrawal age before touching our retirement investments. I'm only 3 years away.
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Abby Normal
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Post by Abby Normal on Aug 12, 2014 13:05:15 GMT -5
I'm not there yet. Now I feel inadequate. ![](http://syonidv.hodginsmedia.com/vsmileys/melancholy.png)
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dannylion
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Post by dannylion on Aug 12, 2014 13:24:10 GMT -5
Lol not remarkable? A net worth of 3M puts you in roughly the top 4% of your age group and top 0.5% of the population. I guess spending a lot of time here can make some feel inadequate as far as investments and net worth go but YM is not indicative of the general population. I guess it's all relative. Among the people in my immediate world I think I'm probably closer to the trailing edge than the leading edge. Most of them are 2-income households, and I'm just me, so I'm factoring that into my assumptions. We're all pretty much low-key, "Millionaire Next Door" kind of people, so I really have no idea, just extrapolating from available information.
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MN-Investor
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Post by MN-Investor on Aug 12, 2014 13:25:26 GMT -5
I think that there are two other questions that should be asked:
At what age did you reach $1M? How long ago was that?
I'm amazed at the folks reaching $1M in their 30s. With that determination, they will be well positioned for retirement. But being 65 and having $1M is a great achievement too.
I had just turned 51 when we hit $1M. That was 10½ years ago. DH has continued to contribute the maximum to his 401(k) and we've also added the maximum to our Roth IRAs, but we're at the point where the appreciation in stock value vastly overshadows the contributions from DH's salary. Just think about it - if you have $1M and the stock market goes up 10%, your portfolio has just increased by $100,000. A lot of folks don't earn that in one year. [Ok, we've also had the down years where we've lost more than DH's salary, but, on the whole, we are stock market winners. In for the long haul.]
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souldoubt
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Post by souldoubt on Aug 12, 2014 13:30:11 GMT -5
I kind of figured you for a Millionaire Next Door type since you felt 3M working on 4M wasn't remarkable. Not a bad thing at all as long as you enjoy yourself and aren't stressing about money to the point it impacts your well being.
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ken a.k.a OMK
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Post by ken a.k.a OMK on Aug 12, 2014 13:47:57 GMT -5
Back in the 80's I had a goal of $1M thinking it was more then we needed. We surpassed that by continuing to invest. What amazes me is all the articles I read about people in their 50's and 60's with only $20k or less. I hope they can live on social security.
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justme
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Post by justme on Aug 12, 2014 14:00:40 GMT -5
I really envy all the two income families. I should move into a little place that costs me like $300/month. ![](http://images.proboards.com/new/tongue.png) Then I could kick ass on the savings. ![](http://syonidv.hodginsmedia.com/vsmileys/yeahthat.gif) Could probably save half of a spouse's salary for retirement and still have plenty of money for fun and probably to invest in real estate or something.
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tskeeter
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Post by tskeeter on Aug 12, 2014 14:11:20 GMT -5
I'm estimating we crossed the $1 million net worth point when I was about 45 and DW was 43.
One of the big contributors was buying a house. The leverage on your money is tremendous. And the leverage generates high returns on your invested capital. If you put 20% down on a $250K house and got 4% appreciation the first year, you'd get about a 20% return on your invested capital. Not bad. And, if you are lucky, you could end up in a location with very high appreciation. We averaged about 20% annual appreciation the first four or five years we were in one house. This gave us a return on invested capital in the range of 40+% per year over that period. And about 28% a year over the 10 years we were in the house, after you factor in realtor fees and make ready for sale costs. (Note, I ignore the PITI in my calculations. For simplicity sake, I consider PITI to be equivalent to the rental value of the house. You've gotta have someplace to live, so you'll probably pay rent, or you'll make a mortgage payment, so that you have some place to live.) Even today, equity in the house is about 10% of our net worth.
The other big factor was saving and investing. In 401K accounts as well as taxable accounts and Roths. And the investment accounts have been almost exclusively invested in stock. I agree with Phil, saving alone will not get most folks entry to the millionaire next door club. You save to build a nest egg. Then you change the title on your card from Saver to Investor.
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Ryan
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Post by Ryan on Aug 12, 2014 14:28:01 GMT -5
I’m 36 and PNW is $600K and it includes cash, retirement, 529, and stocks. I usually just leave out the house, cars, and other stuff because value is always a little iffy.
I think I’ll hit $1M before I turn 40
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MJ2.0
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Post by MJ2.0 on Aug 12, 2014 14:32:17 GMT -5
how YOU doin'? ![](http://images.proboards.com/new/wink.png)
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trimatty471
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Post by trimatty471 on Aug 12, 2014 14:34:30 GMT -5
We're 36 and 38 and hit our first million earlier this year. Keys: 1) Saving/investing - contributed to Roths even through lean grad school years. Maxing 401(k) and 403(b) accounts for almost 10 years now. Sticking with the plan all the way through the ride down and therefore have really benefited from this ride back up over the past several years. 2) House - dumb luck. Owning a home looked like a pretty dumb decision when we lost 20% on the house we sold in 2009. It now looks like a pretty smart decision on the house we bought in 2010 that has appreciated something stupid like 40% in the 3.5 years since we bought it. Currently have ~$250k equity if you believe the assessment number from the refinance we just closed. I'm happy that we're doing very well, but we've got a long way to go to retirement and true financial independence, largely due to the fact that we live in one of the most expensive counties in the country and our daughter is only 1, so lots of expenses to go yet. ![](http://images.proboards.com/new/wink.png) I am thoroughly impressed. I am 36 (single) and I don't even have half a million in assets... let alone net worth. I save a decent amount of my salary every year as well. Real estate has not been good to me... but even if it was I wouldn't be close to that. If you're comfortable expanding on this post I would be very interested in reading more. I am 38 and also singe and going through the same thing...
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siralynn
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Post by siralynn on Aug 12, 2014 14:47:10 GMT -5
We're 36 and 38 and hit our first million earlier this year. Keys: 1) Saving/investing - contributed to Roths even through lean grad school years. Maxing 401(k) and 403(b) accounts for almost 10 years now. Sticking with the plan all the way through the ride down and therefore have really benefited from this ride back up over the past several years. 2) House - dumb luck. Owning a home looked like a pretty dumb decision when we lost 20% on the house we sold in 2009. It now looks like a pretty smart decision on the house we bought in 2010 that has appreciated something stupid like 40% in the 3.5 years since we bought it. Currently have ~$250k equity if you believe the assessment number from the refinance we just closed. I'm happy that we're doing very well, but we've got a long way to go to retirement and true financial independence, largely due to the fact that we live in one of the most expensive counties in the country and our daughter is only 1, so lots of expenses to go yet. ![](http://images.proboards.com/new/wink.png) I am thoroughly impressed. I am 36 (single) and I don't even have half a million in assets... let alone net worth. I save a decent amount of my salary every year as well. Real estate has not been good to me... but even if it was I wouldn't be close to that. If you're comfortable expanding on this post I would be very interested in reading more. If you have specific questions, I'd be happy to try and answer them, but some additional details that have gotten us where we are fall into three categories - Born Lucky, Hard Work and/or Sacrifice, Recent Luck. Born Lucky:- My parents are extremely frugal and taught me great financial habits. I don't remember exactly when I opened an IRA (under my father's guidance), but it was before Roths were available, so probably when I was 17 or 18. My parents were also able to pay for college out-of-pocket, so I didn't have any student loans (I helped by picking the in-state school, and getting a tuition waiver by being a TA for my last two years). They have also been able to do things over the years like loan me money for a down payment, give me a better rate than I could have gotten on a HELOC, etc. - DH bounced pretty far from his family tree, finances-wise. He's more of a spender than I am, but not compared to the general public! When we got married, he had about $15k in student loans in his name, but we prioritized paying them off and got rid of them pretty quickly. (One unknown is how much his dad still has - DH feels pretty guilty and we may end up eventually having to help his parents as they get older.) - Neither of us made any bonehead moves or had to mature via hard financial lessons - never carried credit card debt, etc., so just started from zero instead of in the hole. Hard Work and/or Sacrifice:- We both have doctorates in STEM degrees (income took awhile to ramp up, and didn't start until our late 20s/early 30s, but current combined income is about $215k, mostly from my job) - Willingness to move back and forth across the country and live far from family - Live below our means - we've always saved 15+% for retirement (not counting company matches), and have been maxing IRAs and 401k/403b for quite awhile - Pay cash for cars and keep them for 9+ years. (We do tend to buy new though.) Recent Luck (the past four years have been EXTREMELY kind, net-worth-wise):- the housing bump I mentioned in my first post - the extreme run-up in the stock market - my current stock options are worth a lot right now (I've still got some left from 2010/2011 that are now worth almost double) - in lieu of a pension plan, my current company matches a full 8% on 401k contributions (4% "non-optional" and 4% on your contributions)
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hurley1980
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Post by hurley1980 on Aug 12, 2014 15:06:57 GMT -5
Uh, now I feel like crap! We have hardly anything at 33 and 34, and what we do have is from me saving and investing. MY DH finally starting saving for retirement last year at 32 years old. I basically told him if he didnt, I was going provide him the bare basics from my retirement, and he would have to live with it, since he had no desire to save and always wants to spend spend spend. His company has an amazing 401k, and I think he has a pretty good amount in there for only working 2/3 of the year for them.
I'm hoping we can start aggressively saving over the next 25 years, so we can have between $1-2 million when we retire, but we are pretty far off right now. We only have about $120k total. ![](http://syonidv.hodginsmedia.com/vsmileys/melancholy.png)
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gooddecisions
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Post by gooddecisions on Aug 12, 2014 15:54:49 GMT -5
We hit 1MM at 31 and 2MM at 35. We're 36 and own 3 rentals and a primary, but the real estate market has been horrible to us. Their values peaked in 2006-2007, plummeted and are now pretty close to flat since purchasing within the past 10 years. All were purchased as primaries but we moved and rented them out since the market tanked. The stock market hasn't been much better. The only reason we're where we are is because we stock-pile money into 401(k) ~ combined 750K, keep our overhead low so we can stash more into brokerage accounts and other investments. No inheritances or snowflake money, just W2 jobs. I hope to achieve the 11% averages over the long run. 33k/year for 2 in daycare is our current money pit.
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HoneyBBQ
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Post by HoneyBBQ on Aug 12, 2014 16:02:25 GMT -5
"Hard Work and/or Sacrifice: - We both have doctorates in STEM degrees (income took awhile to ramp up, and didn't start until our late 20s/early 30s, but current combined income is about $215k, mostly from my job) - Willingness to move back and forth across the country and live far from family - Live below our means - we've always saved 15+% for retirement (not counting company matches), and have been maxing IRAs and 401k/403b for quite awhile - Pay cash for cars and keep them for 9+ years. (We do tend to buy new though.)" Yup. Same here. If you make a lot of money and are a tightwad, it's easy to hit a mil in your mid 30's. I just imagine how much I'd have if I decided to remain childless! ![](http://images.proboards.com/new/laugh.png) I kind of figured you for a Millionaire Next Door type since you felt 3M working on 4M wasn't remarkable. Not a bad thing at all as long as you enjoy yourself and aren't stressing about money to the point it impacts your well being. We have quite a few 1%ers here... but if you want to feel poor, go head over to the bogleheads. That's some serious rich there. 0.01 stuff.
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HoneyBBQ
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Post by HoneyBBQ on Aug 12, 2014 16:04:30 GMT -5
Uh, now I feel like crap! We have hardly anything at 33 and 34, and what we do have is from me saving and investing. MY DH finally starting saving for retirement last year at 32 years old. I basically told him if he didnt, I was going provide him the bare basics from my retirement, and he would have to live with it, since he had no desire to save and always wants to spend spend spend. His company has an amazing 401k, and I think he has a pretty good amount in there for only working 2/3 of the year for them.
I'm hoping we can start aggressively saving over the next 25 years, so we can have between $1-2 million when we retire, but we are pretty far off right now. We only have about $120k total. ![](http://syonidv.hodginsmedia.com/vsmileys/melancholy.png) Don't feel badly. You are still doing better than 90% of the population. That's still an A (or A- if you're curmudgeony). ![](http://images.proboards.com/new/laugh.png)
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HoneyBBQ
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Post by HoneyBBQ on Aug 12, 2014 16:07:49 GMT -5
I'm confused about who posted this (maybe my browser isn't displaying correctly)but 30k from your FIRST year alone will turn into According to my Phil Script, a lump sum investment of $30,000.00 bearing an annual return of 11% could grow to $686,768.90 in 30 years! And According to my Phil Script, a yearly investment of $30,000.00 bearing an annual return of 11% could grow to $6,627,395.23 in 30 years! So not sure why it says a wage earner cannot save a million. That is basically what I have done (though my wages are higher than the average bear).
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ArchietheDragon
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Post by ArchietheDragon on Aug 12, 2014 16:09:16 GMT -5
I'm confused about who posted this (maybe my browser isn't displaying correctly)but 30k from your FIRST year alone will turn into According to my Phil Script, a lump sum investment of $30,000.00 bearing an annual return of 11% could grow to $686,768.90 in 30 years! And According to my Phil Script, a yearly investment of $30,000.00 bearing an annual return of 11% could grow to $6,627,395.23 in 30 years! So not sure why it says a wage earner cannot save a million. That is basically what I have done (though my wages are higher than the average bear). You invested, not saved. Mostly semantics, but Phil was making the point that you can't save (in a savings account) and get there./
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Deleted
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Post by Deleted on Aug 12, 2014 16:10:34 GMT -5
I'm confused about who posted this (maybe my browser isn't displaying correctly)but 30k from your FIRST year alone will turn into According to my Phil Script, a lump sum investment of $30,000.00 bearing an annual return of 11% could grow to $686,768.90 in 30 years! And According to my Phil Script, a yearly investment of $30,000.00 bearing an annual return of 11% could grow to $6,627,395.23 in 30 years! So not sure why it says a wage earner cannot save a million. That is basically what I have done (though my wages are higher than the average bear). Phil posted that. He was saying you can't just stick it in a bank account or shove it in your mattress you need to invest it.
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MN-Investor
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Post by MN-Investor on Aug 12, 2014 16:11:27 GMT -5
I'm hoping we can start aggressively saving over the next 25 years, so we can have between $1-2 million when we retire, but we are pretty far off right now. We only have about $120k total. ![](http://syonidv.hodginsmedia.com/vsmileys/melancholy.png) $120K is a lot more than some folks have at 65. Plus you have a lot of years to make that investment increase. And as everyone here knows, once you have the money invested, it starts generating growth on its own. It's like getting another paycheck which is automatically invested 100%. Hang in there - you're doing things right.
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HoneyBBQ
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Post by HoneyBBQ on Aug 12, 2014 16:20:51 GMT -5
Oh I see. 'save' as opposed to invest. My bad. Thank you for the correction! I was thinking PHIL couldn't have POSSIBLY posted that lol. And to anyone who feels badly "With the average 401(k) balance for 65 year olds estimated at $ 25,000 by independent experts – $100,000 if you believe the retirement planning industry - the decades many elders will spend in forced or elected “retirement” will be grim." www.forbes.com/sites/edwardsiedle/2013/03/20/the-greatest-retirement-crisis-in-american-history/If you have 100k by 40, you're doing GREAT!!! ![](http://fhc.leadchangegroup.com/wp-content/uploads/2010/08/Good_to_Great_Leadership_Image1.jpg)
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Kung Fu Panda
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Post by Kung Fu Panda on Aug 12, 2014 16:21:05 GMT -5
"We hit 1MM at 31 and 2MM at 35"
How in the world does one save / create investments like that in 8 years of Post-Collegiate work? Sheesh.. holy inferior complex batman...
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Kung Fu Panda
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Post by Kung Fu Panda on Aug 12, 2014 16:24:02 GMT -5
A nasty divorce and bad money management caused me to start from (0.00) in late 30's, but thanks to high income I will hit my first 1mm at 48, 2mm at 53, 4mm at 60.... and on and on ![](http://images.proboards.com/new/smiley.png)
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muttleynfelix
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Post by muttleynfelix on Aug 12, 2014 16:24:59 GMT -5
Uh, now I feel like crap! We have hardly anything at 33 and 34, and what we do have is from me saving and investing. MY DH finally starting saving for retirement last year at 32 years old. I basically told him if he didnt, I was going provide him the bare basics from my retirement, and he would have to live with it, since he had no desire to save and always wants to spend spend spend. His company has an amazing 401k, and I think he has a pretty good amount in there for only working 2/3 of the year for them.
I'm hoping we can start aggressively saving over the next 25 years, so we can have between $1-2 million when we retire, but we are pretty far off right now. We only have about $120k total. ![](http://syonidv.hodginsmedia.com/vsmileys/melancholy.png) I'm 32 and we have about $110k and I feel good about it. I've got 25-30 years of working for it to grow and contribute. Our finances have been screwy do to medical bills. I think if we can manage the last 7 years like we have (we've only been investing for about 8 years), then we'll be fine in the long run. Just keep your head down and keep doing what you are doing.
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cktc
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Post by cktc on Aug 12, 2014 17:26:35 GMT -5
I'm 30 and currently at -$5k, a long way to go. When I joined these forums I was at -$22k, so at least I'm finally heading in the right direction.
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Deleted
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Post by Deleted on Aug 12, 2014 17:36:45 GMT -5
Uh, now I feel like crap! We have hardly anything at 33 and 34, and what we do have is from me saving and investing. MY DH finally starting saving for retirement last year at 32 years old. I basically told him if he didnt, I was going provide him the bare basics from my retirement, and he would have to live with it, since he had no desire to save and always wants to spend spend spend. His company has an amazing 401k, and I think he has a pretty good amount in there for only working 2/3 of the year for them.
I'm hoping we can start aggressively saving over the next 25 years, so we can have between $1-2 million when we retire, but we are pretty far off right now. We only have about $120k total. ![](http://syonidv.hodginsmedia.com/vsmileys/melancholy.png) you are doing OK. I had way less at your age. I woke up in my40's and have 1+ million in my early 60's. It takes living frugally (but not giving up ALL pleasures) and maxing 401k and even saving change. Hurley you can do it!!!
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