How I Saved $100k in 5 Years

Summary

The speaker shares their journey of saving $100,000 twice by the age of 30, despite earning minimum wage. They emphasize the importance of increasing income through side hustles and career advancement, avoiding lifestyle inflation and debt, and the power of investing to grow wealth. The video highlights the significance of setting specific financial goals and leveraging compound interest for long-term wealth creation, aiming for financial freedom and the option of early retirement.

Takeaways

• 💼 The speaker saved $100,000 by 25 while earning minimum wage, achieved through living frugally, having few expenses, and living at home.
• 🚗 They avoided debt by driving an affordable car, not having student loans, and paying off credit card balances in full each month.
• 🏠 After saving $100,000, they used it as a down payment for a townhouse, which they later sold for a profit.
• 📈 The speaker increased their income by regularly raising rates in their day job and by pursuing side hustles like online selling and YouTube.
• 💡 They emphasize the importance of avoiding lifestyle inflation and staying debt-free, even when income increases.
• 🚶‍♂️ The speaker suggests that increasing income can be achieved through getting new skills and credentials or by switching jobs.
• 💸 They highlight the benefits of investing and how it can turn a small initial sum into a significant amount over time through compound interest.
• 🌐 The speaker recommends using platforms like Moomoo for investing with low fees and taking advantage of tax-advantaged accounts.
• 🎯 Setting specific financial goals and having a clear 'why' behind those goals is crucial for staying motivated and achieving them.
• 💼 The speaker's current goal is not just to save $100,000 but to have the option for early retirement and financial freedom.

Q & A

How did the speaker manage to save $100,000 by the age of 25?

The speaker saved $100,000 by starting to work at 17, living at home with minimal expenses, not going to university to avoid student loans, driving an affordable car, using credit responsibly, and saving almost every dollar earned from a minimum wage job.

What was the speaker's monthly savings when they saved $100,000 over 8 years?

The speaker saved a little more than $11,000 per year, which breaks down to approximately $916 per month.

How did the speaker's spending habits contribute to their savings goal?

The speaker avoided lifestyle inflation, splurging only on a few things like getting a pet, a Macbook, guitars, and attending concerts. They saved almost every dollar they made.

What major purchase did the speaker make after saving $100,000?

The speaker used the $100,000 as a down payment for a townhouse, which they lived in for 2 and a half years before selling it for a profit.

How did the speaker's income situation change after the age of 26?

After the age of 26, the speaker's income started to increase, allowing them to save another $100,000 in less than 5 years.

What was the speaker's initial approach to increasing their income?

The speaker increased their income by regularly raising their rates in their day job, suggesting that switching jobs every one to two years can also be a powerful way to increase income.

What is the role of side hustles in the speaker's financial strategy?

Side hustles played a significant role in the speaker's financial strategy, with the biggest side hustle being buying and selling items online for profit.

How did the speaker's perspective on debt change over time?

The speaker remained debt-free throughout their savings journey, avoiding credit card interest and car loans, and emphasizing the importance of staying out of debt.

What was the turning point for the speaker in terms of investing?

The turning point was when the speaker began to educate themselves about investing, which allowed them to grow their savings much faster and reach $100,000 quicker the second time.

How did the speaker's understanding of compound interest impact their financial goals?

Understanding compound interest allowed the speaker to see the potential of their savings to grow exponentially, aiming to retire a millionaire by leaving their money invested.

What is the speaker's advice on setting financial goals?

The speaker advises setting very specific goals with a clear 'why' behind them, emphasizing the importance of motivation and having a concrete plan for the money saved.