My wife and I got married in 1994. We executed a prenuptial agreement at the time and had total assets between the two of us of $40,000 plus a house we jointly owned worth about $90,000 that had a $70,000 mortgage. We bought the house in 1991 for $85000. We had been together for 5 years before that and had startedwith little more than a couple of old cars, $5000 in IRAs, and $5k in student loan debt. We both had jobs but not high incomes.

We paid off the house in 1999.

In the last 15 years one or both of us has been in school the entire time. Of the 15 years, I took 5 of them off work to go to school full time and my wife took 3 off.

In summer 2008 we topped $1 million in net worth. At that time we bought a second home in a tropical resort area, with a small mortage to get the tax benefit. That gave us a substantial increase in assets but also debt. Our debt to equity ratio had been zero for 9 years and we put it up to about 1/4 which is still conservative for individuals. We pulled a large amount of cash out of teh market in August 2008 just before the crash to pay for the second home (30% down). We also got a low price on the home and a smoking mortgage rate because we closed in the midst of the crisis.

We did lose some money in the turmoil but all in all we now have a net worth of $1 million again, a reasonable D/E ratio, and a beautiful second home to enjoy that produces a good rental income when we are not using it.

We accomplished this by being smart, reading and learning about anything we did not understand that affected our finances, avoiding fees as much as possible, never investing in anything we did not understand, living a healthy lifestyle (which helps avoid medical expenses and keeps you healthy), not splurging on expensive stuff. A the same time, we have traveled the world, made several trips to europe and tropical islands. Basically, we have not suffered or deprived ourselves.

I love reading stories like this one. Great stuff. I'd love to read more details on how you accomplished all of this. Very motivational.

We did not do anything that is not available to almost everyone. We did not have extravagant incomes most of the time, and actually only 6 of the last 20 years did both of us work full time!

We made a plan in about 1992 that would allow us to retire well before 50. We are 45 and 50 now and could retire if we had to, though it would be a stretch. We sort of followed the plan but took some detours along the way. But we no longer want to retire. We give a lot to a couple of charities, we have enough saved that we can spend a little more on travel and such without worry now, and we both genuinely like what we do. The point is, make a plan and work toward it. Don't worry about diversions or things that come up. Use it kind of like a roadmap. You might get distracted, make a wrong turn, take a side trip to do something you enjoy, but the map is there to come back to.

We do not have any kids but we helped put a relative's child through private school and will be helping pay her college using savings we've put away for that. We did this without the tax benefits that many enjoy for their own kids so it cost us about 25% more. So we are aware of the costs of a child or two. I don't think however that children would have changed where we are now. We would have had a simila rlifestyle and gotten to a similar place in life.


The secrets were:
1. Live within your means and enjoy a modest lifestyle. Don't spend more than you make. Besides food, water, clothing, and shelter you do not need anything else. But if you want something that will bring enjoyment, save up and buy it. Then take care of it. We have nice stuff and take care of it. We just bought a huge widescreen TV - because our 20 year old TV finally died. We will probably have the new one 20 years from now. Always buy quality stuff instead of the cheapest stuff. It will last much longer. Never buy anything on credit that you can't pay off right away. As I have said elsewhere, we buy almost everything on a credit card BUT we always pay it off every month and never pay interest! We pay cash forcars and then keep them for 10-15 years. The best thing you can do when you want to buy something is simply wait a month!

2. Invest automatically and pay attention to fees. Pay yourself first. Set up an automatic monthly transfer to a mutual fund so that you invest without thinking about it. Do not ever let a broker or anyone else convince you that fees or expenses have any relation to investment performance. This is always a lie! Always. You can get free advice many places. Learn about money and do it yourself.


3. Eat right, exercise, and stay healthy. This will keep medical expenses as low as possible. Eating fresh foods will also save you money. A bag of apples costs less than a package of cookies and will last much longer.

4. Work hard, keep learning, and get promoted. Your employer rewards you because of the benefit you bring not because they feel sorry for you. Make yourself a valuable employee and you will be rewarded. Just show up and do the minimum and you'll stay where you are and your salary will barely keep up with inflation, if you are lucky. You might also be teh first out the door in a downturn.

5. Pay a littel extra every month on your mortgage. Never let the bank charge you for that either. Most banks have a biweekly payment plan that they chareg you for. Don't do it! Just send a little extra in each check. You'll be amazed how fast it adds up.



If there is something you enjoy, do it so that you will be happy. But think of it as a treat rather than an entitlement.

A caveat to #3 in my previous message. DON"T SMOKE.

If you smoke 1 pack a day you are spending an extra $100 a month. Invest that or use it to pay down debt and you will accelerate your success enormously. You will also be healthier and this will save you an medical expenses and cause you to miss less work. Missing less work will make you a more valuable employee. And when you smoke, you smell like smoke. Do you really think your clients, customers, boss, and other nonsmokers don't notice or are not bothered by that?

Personally I think people should do what they want. If you want to smoke then that is your choice. But if you want to know one single thing you can do to help you financially I will tell you it is to not smoke!