How to Save the First $100k
It is a hard goal but far from impossible…
That is my conviction! It might sound completely out-of-reach at some point, it might look immensely distant but in fact, it’s just in the numbers.
Yes, numbers. I am not a great believer of any get rich quick method and I do not play the lottery.
“ I believe in what I can see and what I can control. “
What can I control?
My income and my expenses. Plain simple. In the end, the ability to earn, save and invest just depends on me and me only. It is up to me to come up with the plan and execute it. Compound interest is there to help and to speed up the process.
What can I see?
I can see my account growing every single month because I stick to my plan. I can see the appreciation of my assets and I can see the compounding effect on my money.
Is $100K my financial goal?
Yes and No. My ultimate goal is financial independence. Personally, that means for me not having the obligation to work the 9-to-5 job to be able to live and reaching a point where I can just live off my investments if I wish to. For me is about freedom and relaxation.
On the other hand yes, $100k is an intermediate goal and a major milestone. It is also a lot of money (at least for me). Having intermediate steps is fuel to our mindset.
“ First, it was $10K, then $20k, then $50K… “
Every goal we can accomplish and reach makes us want more and more. As much as I like to think about the finish line and my ultimate goal, I am not obsessed with it. I am not counting the years until I am technically able to retire (but I do have a prediction on an excel sheet).
In the end, it will not be solely because I have the money to do it but also about the enjoyment of what I might be doing. If I do happen to enjoy my work in 10 or 15 years, I might reduce my workload but not retire completely. It will all depend on the sum of several factors.
Honestly, it is already hard enough to predict what will happen next year so I don’t stress about what might happen in 10 years time.
I do focus much of my efforts in saving money because that is somehow easier to achieve. Something harder might be to improve my income (at least significantly).
How can we do it? Side hustles, part-time jobs or freelancing is a way to play that game. I mentioned some of them here:
In many cases, something overlooked is a salary re-negotiation or a change of job. Sometimes this can easily add 5% to 10% on our annual salary without really changing what we do.
However, a higher salary does not mean we are able to save more. That will depend on how we manage the extra cash and if we maintain our expenses at the same level.
Is about discipline and being mentally strong in order to not change your lifestyle. Believe it or not, this is actually very difficult for us. If we take it to the extreme, how many of us would not change a simple thing if we won $25k in a lottery ticket? Hardly anyone.
Let’s start with the numbers:
So if I am saving on average $4000 a month, I can then quickly put together $48k a year. Times 2 we are at $96k.
If I do not only save but invest my first-year savings I could potentially turn $48k into $50k rounding up on 5% return, which can be seen as conservative.
So in roughly 2 years, I should be able to do it! That happens even if I do not manage to increase my income (which I am currently trying to do).
So long story short, $100K is not that far if I am able to maintain my current lifestyle while saving and investing.
“ There is no secret here or magic recipe. It’s just a plan waiting to be executed. “
What is your current savings goal? Let me know in the comments below.
If you like my content, please check my other stories:
Disclaimer: I am not a financial advisor. Always do your own research when investing.
