From the /c/personal_finance community on Chambers

Throwaway because I don't want this on my main but you guys are great at giving advice so I thought I'd share some successes and mistakes for anyone whose also trying to get rich. A little bit of background: I make $300k a year, I'm 31, and I live in a high tax city. I graduated with a bachelors, no student loans, went straight into a pretty high paying job (I thought it was a lot at the time, now I realize everyone makes at least 3x my starting salary out of college). At the time I was also living like an idiot and making about $70k. I bought a brand new BMW M3 right out of college, was eating out constantly, and went on a few vacations a year. I managed to save maybe 10% of my income. I think I had saved $0 when I got my first job and 4 years later I had managed to save $15k. The rest was just spent. # Lesssons Learned: ## 1 - Its not the income you make, its what you save I made $70k a year out of college and saved $0. I didn't actually start saving money until I made $300k a year and started living cheaper. The difference for me was that I took the money I made and spent less of it so I could save more. Everyone who says "not enough money" is either a troll or delusional. You can make $15 an hour and still save money, just don't waste it. ## 2 - Selling something for $100k doesn't mean you're rich I've heard this one before but didn't quite understand it. I work in a job where I make a lot of money but I also have a second job (as most of us do) that supplies some extra income. Every year I can expect to have a few months where I get a bunch of this extra income. It can be a lot. The last 4 years I had one of these periods and ended up with an extra $500k that I hadn't really budgeted. The reason I mention this is because I managed to go broke the first time it happened to me. I ended up spending all the money, which destroyed my savings, and probably didn't end up with more than $5k at the end of it all. This happened a second time and I managed to end up with a few tens of thousands of dollars left. Now I realize that with all this extra money, I am still not rich. I need to keep working, keep saving, and keep making smart decisions financially. Selling something for $100k doesn't mean you're rich. You still need to pay taxes, and live your life, and you'll probably end up with much less than you think. ## 3 - Its harder to be frugal if you're making more money I used to make $70k and felt like I was broke. Now I make $300k and feel the same way. The biggest problem is that the more money you have the more reasons you have to spend it. Everyone who knows you is going to ask you for money. You're going to be able to afford more things you want but didn't have the money for. You're going to get invited to more expensive things. I realized that the more money you make, the easier it is to rationalize spending money. The key to this is being able to set limits and live up to them. Everyone who makes good money will have a few friends who don't. You have to be able to say no to your friends, even when they don't make as much money, and don't get invited to expensive things. This is a trap I think a lot of people fall into. For me, I was able to set limits and live up to them. I took a 0% interest loan from my parents to pay for a house so I didn't have to sell anything at a discount. I also bought a new jeep with cash. For the last 4 years I didn't spend a dollar on anything that didn't make me money or wouldn't last 10 years. I bought a new car, I paid for a house, and I paid for some home improvements. Everything else was an investment. ## 4 - If you don't make money you don't make money This one was a bit of a challenge for me. I'm pretty good at my job and I'm pretty smart. Because of that I would devalue other people's work and think I could do it myself. This is a huge mistake. If you're not good at something, don't do it. I tried to save money by doing things cheaper. I tried to remodel my own home. I tried to do the accounting myself. I tried to do my own legal work. I tried to do my own home maintenance. The problem is that I am not qualified at doing any of those things. When I did them, they were shitty. And I wasted time and money on them. I was much better off paying a professional to do it and focusing on parts of my life where I could make money. If I waste $10k on a bad remodel, I probably lost $20k - $30k in time I wasted doing it myself when I could have been working. Just hire professionals. ## 5 - Rich people are not ugly I used to think that I was special and that everyone else was jealous of me. I honestly think this is the case for a lot of people and it took me a while to realize that I was acting like an idiot. If you're making $300k a year you're not superior to anyone else. No one cares about you. No one wants to be your friend. No one cares about your car, or your house, or your bank account. At best, people are indifferent. At worst, they're resentful. Cunning and deceitful people will try to manipulate you out of your money. People you care about will treat you differently. Everyone is out to get you. If you think that you're somehow special because you make more money, you're delusional. No one cares about you. # This is How I Made It: Over the last 4 years, this is how I've saved $300k. I made about $300k a year after taxes, but I didn't save all of it. I managed to keep my expenses the same as when I made $70k a year. The difference is that I realized the value of money. You don't need to spend money on stupid things like going out to eat or buying a brand new car just because you can. The key to making money is being able to live below what you make, its that simple. For me, I just had to avoid blowing money, and I managed to do that. I honestly regret not doing it sooner. That money could have been invested a long time ago and I could have made a lot more on it than I will now. # Why I'll Probably Go Broke There is one big problem with my strategy that I don't think I can avoid for much longer. Its that the more money you make, the more people are going to want to take money from you. For the last 4 years, I've managed to solely focus on making money without any regard for other things. I solely went after money and it worked. I managed to save a lot of money. I made a lot of money. I was able to do what I wanted for a while. But the truth is that the only reason I think I was able to do it for this long is because I don't have any kids. As soon as I have kids I think I'm going to lose focus of my goals and start spending money. I think that I will probably end up about even, as the money I spend on my kids will be offset by the fact that I'll be earning more. But I'm not going to have any money anymore. I'll still be able to save but I won't be able to save 80% of my income. My expenses will also go up. So even though I'll make more, I'll be making it at a different time in my life. # Conclusion To summarize: save money, don't assume you're rich, and focus on your goals. For me, the last 4 years has been a time of great growth but the next 4 years will be different. Hopefully I'll be able to save another $300k but I doubt it. I'm going to be making more money and spending more money. I'm going to be making different investments. I'm going to be living a different life. The last few years has allowed me to get where I am, but the next few years will be different. Edit: I'm not lazy at all. I'm a very very hard worker. I've been working since I was 8 years old. I've spent the last few years working non-stop and been very productive. I didn't luck into this. I made it happen. I'm just saying that I think I'm at a crossroads now and I need to make some decisions about the future. Edit2: I understand this post doesn't have a lot of value. I'm not here to give advice with specifics. I'm here to give my own story and experiences and the lessons I've learned from it. I'm sorry that some people find it worthless. For the people who find it valuable, thanks for the karma and the support. Much appreciated.

$0 - $300,000 in 4 Years and a Few Lessons Learned

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