How Fast Can You Make A Million Dollars?



I met someone at work who says he wants to hit FIRE as soon as possible.  He married his wife recently, and they want to start a family fairly soon.  Unfortunately, each of them has accumulated a bit of debt, and they haven’t really started saving for retirement.


Lofty Goals and Crazy Kids

make a million dollarsHowever, he is adamant that his wife should be able to quit working and be a stay-at-home mom.  In turn, he stated that he would like to retire shortly afterwards to spend time with his kids.  Another co-worker snickered behind us and said, “Just wait.  If your kids are as crazy as mine, you’ll be back in the workforce in no time.  Staying at home with crazy kids is no way to live.”  


We all had a good laugh about that.  Jokes aside, I said a quick prayer in that moment, hoping that my kiddos wouldn’t end up that crazy.  I can’t imagine choosing to work rather than spending time with my kids, but I guess it’s not all that uncommon!


Truthfully, I would love to do the same thing that my co-worker desires.  At times, it is tough having to leave for work everyday when my son is wanting to play.  It makes it even harder knowing he won’t always be in this stage.  I want to take advantage of these moments while I still can.  


His Numbers

make a million dollarsMy co-worker also wants to buy a house, as he is sure that he wants to stay in the area.  Rental prices are creeping up.  At times, the monthly mortgage payment for owning a house is roughly the same as renting.  He briefly shared some quick back-of-the-envelope numbers with me.  It showed that they were roughly spending $40,000 a year and had saved virtually nothing so far.  


We talked through their expenses, to which he confidently told me their was no fat in his budget, so there was no way they’d be able to cut further.  Many in the PF community suggest that there is always fat in a budget.  If you are eating plain noodles and walking everywhere though, I’d hazard a guess that there may be no fat left.  


make a million dollarsBased on their current rent, they are looking to obtain a mortgage of roughly the same size.  He asked me, “If I’m essentially starting at zero, how long will it take for me to reach FIRE?”


My wife tells me all the time that I have a terrible poker face, so I’m sure he saw my look of uneasiness as the numbers weren’t anywhere close to allowing him to achieve FIRE soon.  


Years to Retirement and Savings

I put together a quick spreadsheet utilizing an 8% stock market return, based on historical averages, to show him how realistic it really was for him to hit FIRE and stay at home with his future kiddos.  


Years to Retirement

Saving Per Year

Savings Per Month

1 $1,000,000.00 $83,333.33
2 $480,769.23 $40,064.10
3 $308,033.51 $25,669.46
4 $221,920.80 $18,493.40
5 $170,456.45 $14,204.70
6 $136,315.39 $11,359.62
7 $112,072.40 $9,339.37
8 $94,014.76 $7,834.56
9 $80,079.71 $6,673.31
10 $69,029.49 $5,752.46
11 $60,076.34 $5,006.36
12 $52,695.02 $4,391.25
13 $46,521.81 $3,876.82
14 $41,296.85 $3,441.40
15 $36,829.54 $3,069.13
16 $32,976.87 $2,748.07
17 $29,629.43 $2,469.12
18 $26,702.10 $2,225.17
19 $24,127.63 $2,010.64
20 $21,852.21 $1,821.02
21 $19,832.25 $1,652.69
22 $18,032.07 $1,502.67
23 $16,422.17 $1,368.51
24 $14,977.96 $1,248.16
25 $13,678.78 $1,139.90
26 $12,507.13 $1,042.26
27 $11,448.10 $954.01
28 $10,488.91 $874.08
29 $9,618.54 $801.54
30 $8,827.43 $735.62


Reality Check

His jaw hit the floor.  All that he could do was sit and laugh afterwards.  He admitted that he had no idea how difficult it was going to be to reach FIRE and that clearly something needed to change.


Even I was shocked by the numbers.  Without a mortgage, my wife and I have similar expenses.  Clearly, we need to re-evaluate our spending as well.


Over the past five years since my wife and I finished paying off our mortgage, we have been diligently saving as much as we can so that we can reach FIRE.  Even so, the numbers are a little disheartening.  While we have made tremendous progress over the years, we still have a ways to go.


Only So Much Fat to Trim

I know it’s really popular in the PF community to find any way to trim more fat from one’s budget.  But as you can see from the numbers above, if you want to reach a million dollars, you still need to make some decent money in the meantime if you want to reach FIRE sooner rather than later.


So readers, do these numbers surprise you?  Am I missing anything?  Share your thoughts below.

Mustard Seed Money

Welcome to the website. A mustard seed is a very small seed but astonishingly grows very large over time. My hope is that through your financial journey that your small investment in time, money and faith will grow beyond anything that you could ever imagine.


  1. MSM — As a father of rather crazy twin boys, I relate to the co-worker who snickered. Staying home with kids is not a panacea, especially after the first year or two when they need lots of activity and engagement. It depends on the individual child and the parent, of course, but in my opinion / experience It is much harder than going to work, and often less fulfilling. People should be honest about the very real difficulties of reaching their best, most balances, most healthy selves while being home with kids.

    Consider the act of using your brain. I find great fulfillment in being engaged intellectually by the people around me and the activities I undertake. This happens mostly at work. After a week at home with kids, trying to guide them from place to place and helping them manage their volatile emotions, I am physically exhausted and intellectually stir crazy.

    I don’t mean this in a completely negative way. There are huge benefits to being with children and I love being present with them and enjoying the bond we have. But I also recognize that to reach my own potential, I need more than family time. And for the kids to reach their potential, they need more than my attention. They do much of their learning and growing as they start to experience others, whether in play groups or preschool or elementary school or whatever. I love bringing them to those environments.

    Additionally, I would add that there is a very real value to modeling a balanced life to our children. I’m glad that my kids see me engaged in work, and even leaving them at times to prioritize work. I’m not sure how I’d feel about them seeing the example of my saving as much as I could as quickly as I could so I could only focus on them. Our family is the most important thing in the world to me, but the world is bigger than our family, if that makes sense. I want them to see this balance.

    Anyway, FIRE folks may disagree and I know there are different ways of doing it, and that FIRE doesn’t removing oneself from the world. I just think that sometimes in our desire to escape the drudgery of work, we can miss the important role it plays not only for our own self-actualization but also for our children’s worldview.

    Great post as usual!
    Rich @ recently posted…Monthly Money Check: Penny’s Budget Blew A Gasket in June 2017My Profile

    • Thanks for sharing Rich!!! I couldn’t agree more. I definitely want to model to my kiddos the importance of hard work and pushing past my boundaries. As much fun as it would be to play with them all day I know that I wouldn’t be able to grow as a father and allow them to experience all the things that they need to in order to become productive adults. It’s a fine line that I have to walk but teaching children about work life balance is definitely one that intend to share 🙂

  2. Ouch ouch, that’s discouraging! Even at a 8% too. FIRE in 30 years isn’t quick enough for most people, I’m betting. I mean if you start at 22+30= you’re already over 50! What’s a few more years when the kids are already grown and you’re bored. $735.62 is not doable when I was on a $40K income if I hadn’t bunked with my parents (and I don’t imagine any adult doing that for 30 years!)

    I believe there’s always fat to trim on an average income (+/-$50K).

    Me and Jared are doing well and I’m beyond thankful for that. Maybe I saved a drowning kitten in my past life?
    Lily @ The Frugal Gene recently posted…12 Surprising Things AirBnB Guests Love And HateMy Profile

    • Thanks for sharing Lily!!! I definitely didn’t share to be a downer as much as share that sometimes it takes more than just cutting down bills in order to reach FIRE. I don’t feel like both sides are always told when it comes to FIRE 🙂

  3. The good thing now is that you can run the numbers again, having trimmed say $100/mo or $250/mo off their budget — and compare the results. Maybe easiest with an extra two columns added to the right of the first set.

    I hope this gets your co-worker pondering about how much of the “not fat” spending he can cut. Perhaps introduce the idea of dropping expenses which do not fulfill?
    Sabbaticalia recently posted…Our draw-down plan for Financial IndependenceMy Profile

    • Great suggestion. I tried to get the calculator to work for everyone but I ran out of town before I posted. So I’ll definitely work on it so he can see what it will look like by dropping the expenses a little bit. Should be interesting to say the least 🙂

  4. Well, I don’t know what he’s so worried about. Who doesn’t have an extra $83K lying around some where. Let me check my shoebox. Lol maybe if this was Zimbabwe back in the day. /sarcasm

    In all seriousness, those numbers are very daunting. I know we have things we can cut, but nothing that’s going to propel us to FIRE in less than 20 – 30 years. I suppose it goes back to finding side hustles or downsizing your living. But, with children, there are only so many hours in the day and only so many places you would actually want to live.

    Further, I just spent 5 days off with my wife and 20-month-old son. I’m burnt out. I hate that I’m burnt out because I really don’t love what I do. I think the happy balance for me would be working for myself and I’m doing things now to attempt to set that up in a few years.

    Either way, reaching FIRE has to include having additional sources of income. To me, I wouldn’t want to just draw down from a huge stock of money. Instead, I rather have built a few sources of income to sustain me over the long haul and to which I can pass on to my children.

    $1M saved would be awesome, but I think your co-worker may want to think about the marketable skills he and his wife have that could that they could turn into a business.

    Granted, whatever you round you go, it’s not easy. It will require tremendously sacrifice (a lot it sleep in my case). But, to me, going for it is better than giving up. So, we just push on and do what we can each day to work the plan.

    • Thanks for sharing Dave!!! I definitely agree that multiple streams of income are probably a better way than drawing down on your portfolio. Creating those opportunities are not always easy and it’s definitely easier to sit on the couch watching TV than creating a side hustle. I figure while I’m young and have energy I might as well try 🙂

  5. The numbers don’t surprise me. If your co-worker wants to save a million dollars as quickly as possible, there are a few options to do this if there is no more fat to trim in his budget:
    1) earn more from his employment opportunity income and save the additional earnings.
    2) balance his assets with stocks and real estate.
    3) work harder to find a side hustle to make more income
    4) find ways to pay less taxes (legally). I am sure that if you look hard enough, you can find a couple of deductions.

    These are only a few things that I used to get myself from zero to $1M in about ten years time.
    Leo T. Ly @ recently posted…My 2017 Net Worth Performance Review – Q2My Profile

    • I agree – if you’ve cut spending as much as you can, the only thing left is to increase earnings.

      I’m already FIREd, but when I was younger focused on earning as much as I could and saving it. It’s wasn’t easy because if earning more always involves direct labor then I had less time to spend with my young family (wife and 2 sons).

      I think starting own business that eventually generates passive income is the fastest way to FIRE. And with today’s technology that is completely doable.
      Mr. Freaky Frugal recently posted…Instant savings with discounted Gift CardsMy Profile

      • Thanks for sharing Mr. Freaky Frugal!!! I definitely agree the earlier you can start your own business to start generating passive income the better. It definitely helps you reach your goals that much faster.

    • Thanks for sharing Leo!!! You have an amazing story of going from zero to a million and are obviously sharing some wise words. Hopefully he’s reading 🙂

  6. Well, your numbers seem to be right based on a yearly 8% return. Nobody said it’s easy… Of course it’s only a very simple calculation and disregards things like increases of income, inflation etc. But the end result would be the same: many years.
    If your co-worker really cannot cut expenses, there is only one way to speed things up: increase income. This can be anything from a side hustle, job change or buying a duplex and renting out one part. Every little extra income that goes to savings can mean years.
    Roadrunner recently posted…June 2017 Financial OverviewMy Profile

    • Thanks for sharing Roadrunner!!! It’s definitely a bit of a crude calculation but it was meant to show just how daunting it really can be without an increase in income along the way. Definitely had no idea that the numbers would like that.

  7. I doubled checked your numbers, MSM and you are RIGHT!

    I was a bit shocked myself. It forced me to run the numbers for myself. I hit over $100k in my 401(k) by age 29, and including my Roth and my wife’s Roth and our taxable account as our present value of investments – calculating the number of years until we hit the $1M mark with our current investment strategy ($45k/year), it will take us 10 more years!!! Once my wife goes back to work, we can shave off two years if we max out her 401(k). If we can do that, then I might give Joe over at RB40 a run for his money 🙂
    The Grounded Engineer recently posted…Teaching Our Children the Importance of Compound InterestMy Profile

    • Thanks for checking the numbers!!! It’s always a bit scary sharing numbers and trying to ensure that you did the formula correctly 🙂 Sounds like you are well on your way to challenging Joe 🙂

  8. Those who frequent personal finance blogs will know ballpark numbers of how much they need to save and spend to make FIRE work, but the general public as a whole is woefully ignorant of what it takes. The gap between the nest egg for the average American family and the number needed for safe withdrawal in early retirement is huge.

    It can be uncomfortable, but I think you are doing someone a favor by running the numbers like this; it’s a much needed reality check for most people.

    Regarding the crazy kids, I agree that there needs to be some balance. Even if we want to spend all day with our children, there’s a good chance they don’t want to spend all day with us parents! Quality time is much more important than quantity.
    Dr. Curious recently posted…Welcome, New Human!My Profile

    • Thanks for stopping by Dr. Curious!!! I definitely agree most in the PF community have a good idea of when they can retire. Hopefully for those without a good sense this will help just a little bit 🙂

  9. You did your co-worker a huge favor by bringing him out of “La-la Land”. He wanted to achieve great things, was convinced that he could, yet he had no road map to get to his destination.

    I agree he needs to increase his income and I sure hope he doesn’t use any debt to do it, i.e. start a business or buy investment real estate using OPM.
    Mrs. Groovy recently posted…How Much Crap Is Hiding Behind Your Walls?My Profile

    • Hahahaha…I definitely hope he doesn’t use OPM to get started. That is a huge double edged sword that often doesn’t end well for those that don’t know how to use it correctly.

  10. Awesome post. I’ve never given much thought to the physical numbers behind making FIRE possible (I know, some PF blogger, right?!), so it’s great to see the numbers laid out.

    Definitely makes FIRE look a lot harder to achieve! People need to see these types of numbers though. It could be exactly this shock that gives your co-worker (and the rest of us readers) this kick to get our savings plans in order. Gives us all something to aim for 😉
    Yaz | The Wallet Moth recently posted…10 Things No One Admits About The Digital Nomad Lifestyle!My Profile

    • Thanks for sharing Yaz!!! I have to admit that I was a bit shocked by the numbers as well. Definitely seemed a little bit harder to reach than I first anticipated.

  11. Those numbers don’t surprise me as I run them pretty frequently for myself. $40,000 per year budget is pretty solid with a kid and mortgage/rent. It would take a lot of work to trim that significantly I would say.

    A lot of the people in the financial community are super achievers and make having a million plus seem easy. The truth is it takes a dedicated effort to ever hit that number much less in 10-20 years of working.

    That is awesome that he felt comfortable talking to you as you did him a great service. He will benefit greatly from seeing this and can start making decisions about earning extra income, trying to trim expenses or deciding that working 30 years won’t be terrible.
    Grant @ Life Prep Couple recently posted…The Power of The Mind: Elite vs AverageMy Profile

    • Thanks for sharing Grant!!! $40k in the DC area definitely doesn’t seem like a ton of money when you consider property taxes, food costs and other living expenses. Maybe it’s time to move somewhere a bit cheaper 🙂

  12. The numbers are pretty shocking but I am not really surprised. FIRE is a great thing but it is hard to accomplish. If it was easy, everyone would have done it. The best you can do is position yourself financially for the future and enjoy the journey.
    Dividend Daze recently posted…Recent Buy – General Mills (GIS)My Profile

  13. I mean, you do have to make changes/sacrifices to your “must-haves” if you want to reach FIRE, especially if you want to achieve it rapidly. So your coworker probably could get FIRE faster if he and his family would budge on a few non-negotiables or commit to slashing their expenses.
    Mrs. Picky Pincher recently posted…The Picky Pincher June Budget ReportMy Profile

    • Thanks for sharing great points Mrs. Picky Pincher!!! He really needs to decide if reaching FIRE is a must have or some of the expenses are must haves. You can’t say BOTH!!!

  14. Not surprising and a great dose of reality in this post! If we’re honest with ourselves, Personal Finance blogging “La-La-Land” is a worsening problem. It takes hard work. Time. It takes a lot of savings in real dollars (not just assets). I’ve always found that looking at real numbers and not percentages makes it more real for me — i.e., the sacrifices required, the dollar amount to be saved. Mainstream finance media, or even PF blogs, that tout millionaires in the making (in just a few years OR “by 30” WITH this awesome blogging course) aren’t really helping anyone in my opinion.
    Teacher Investor recently posted…Take care of one another. Getting old. Recognizing when you (and others) need help with financesMy Profile

    • Thanks for sharing Teacher Investor!!! I’ve experienced SOME of the millionaire bloggers are pushing a product that made the millionaires along the way 🙂

  15. They don’t surprise me at all! There is so much more though than just numbers. I feel sometimes that most people who want to achieve FIRE don’t factor in…ya know, life! Both just living and unexpected things that come up during the course of life. It’s like if there was some VO announcer creating the trailer for your FIRE life that said, “In a (PERFECT) wooooorld…” No such thing! 🙂
    Tonya@Budget and the Beach recently posted…My Frugal LA Apartment TourMy Profile

    • Hahhahaha…I would love having a VO announcer narrating my life 🙂 I would laugh at some of the stupid things that I have done and listening to “the voice” would make me lol.

  16. These numbers could appear scary for some but there’s a simple way to help you reach your savings goals.

    Save money from your paycheck first then use what’s leftover to pay expenses.

    I find too many people save after they spend their paycheck on expenses and mostly on things they don’t need.

    Staying committed could help you become one of those people who retire by 45 or less.
    Cory @ Growing Dollars from Cents recently posted…How To Start Email Marketing For Beginners – The Right WayMy Profile

    • Thanks for sharing Cory!!! I definitely agree that if you’re diligent the numbers really aren’t as bad as they look. But they’re definitely not as easy as everyone thinks.

  17. I can’t help but feel bad for this guy and have to believe that his thought process isn’t his fault. I am willing to bet he was never properly taught “personal finance” growing up, much like myself.

    If he is willing to learn and listen, give him everything he needs (and more) to be successful. Otherwise, it is only going to be you, who retired-early, on the beach drinking margaritas while everyone else is working. That just sounds lonely.

    Charitable gifts can be much more than dollars and cents, it can be done through knowledge sharing. Very admirable, MSM!
    Church recently posted…Net Worth June ’17My Profile

    • Thanks for sharing Church!!! I’ll have my wife with me and kiddos so I won’t be too lonely on the beach. It didn’t seem to bother Christie too much 🙂

  18. Depressing and so true. It is important to sit down and calculate those numbers. A high paying job makes it easier. I am not sure I will have FIRE but will at minimum cut back to 60% at some time in the next 5 years. If I hold out 10 years I could likely retire early but then my son will be 12 years old. Spending more time with him at 7 seems like more fun than 12 (thus the desire for part time work).
    Dads Dollars Debts recently posted…Hump Day- July 5th, 2015My Profile

  19. Yes, your math is correct. $1m might not be what it once was, but it is still a great sum of money for an individual or family to acquire. It has taken me 20 years to reach a $1m net worth. That is based on investments, home equity, cash value of a pension, We should have $1M solely in investments in 3 years. Our savings have increased with salaries. At age 20, I was earning $20k per year and saving over $500 per month. 20 years later, my wife and I are saving $5-6k per month due to career advancement and minor lifestyle creep.
    Dave recently posted…My Kayak: Frugal Fun on The LakeMy Profile

    • Thanks for sharing Brad!!! I definitely agree that they probably need to increase their income if they want to reach FIRE sooner rather than later.

  20. From my understanding and calculation, on average, it takes about 10-14 years to reach $1M milestone. It all depends on the savings rate and the market.
    And knowing these number people tend to cut their budget even more, but sometimes we forget that by cutting more and more, saying “NO” to family vacations or entertainment we aren’t doing good for our family relationship.

    Personally I believe that crazy kids are nothing more than reflection of their parents and parenting. The same is true for well behaved kids.
    Friendly Russian recently posted…It is not about moneyMy Profile

    • Hahahaha…I’ve seen some crazy parents with great kids and vice versa. So I don’t put everything on the parents. Although in some cases it’s true.

  21. I think there’s an issue of balance: you can theoretically cut fat until you live on ramen noodles and never buy anything new. Is that a sacrifice you want to make for FIRE? How will your health and comfort be affected? I think everyone has to find their “sweet spot”, but the most important thing may be to run the numbers and plan ahead, so you know where you’re headed, and when you can expect to reach your goals.

    • Thanks for sharing Miguel!!! I definitely agree that you need to be able to live your life for the future as well as enjoy it currently. It’s not always an easy balance but it’s definitely doable 🙂

  22. I am again amazed at your ability to get work colleagues to share personal financial information with you. You changed jobs so this is the second time you have become the financial rabbi of your workplace.

    1) I think quitting work to spend full-time with your children is ultimately an unsatisfying decision. When kids are young, they want their parents around but as they grow older, they typically don’t want their parents around. Beyond that, people living for the betterment of other people (even their children) are 100% guaranteed to be disappointed because no one wants to feel obligated to fulfill someone else’s aspirations. I have always felt that healthy children will rebel against their parents for no reason except to rebel.
    2) I read a book title once called “The First Million is Always the Hardest.” I don’t know what it was about but the title stuck with me. There is a lot of truth in it. If you have $1,000,000 in investible assets, you need a 100% total return to “make a million.” If you have $2,000,000, you need a 50% total return. Then a 33% total return.
    3) re: Crazy Kids – I interpret that as children who behave criminally or erratically. Alcohol & drugs are common causes. I have met enough families that I am of the belief that there are bad seeds. I have seen families where all the kids are successful except one who is a drug addict or criminal. I have seen coworkers’ sweet children turn into juvenile delinquents as teenagers, commit serious felonies and get locked up. I have seen young girls turn into promiscuous teenagers. I have a good friend whose daughter had an eating disorder. After spending who knows how much money on counseling session, the girl was able to stop her eating disorder but switched to “cutting” which is cutting yourself. All of these situations involved “good” parents who were well adjusted and/or had raised other children successfully.

    • Thanks for stopping by Dan!!! I have this weird obsession with finance and it comes out during a lot of my convos with co-workers. So eventually someone will pull me aside to share some things. I definitely enjoy that I can be share some of my financial opinions 🙂

  23. Income = your biggest wealth-building tool. You still need to live life, when trying to obtain FIRE. Just like your co-worker, he wants a house and family. Even setting a short term goal for a period of time 3-5, or 5-7 years of hustling to bring in extra income might be a great goal to boost the over timeline.
    Brian recently posted…Debt Discipline FeedbackMy Profile

    • Thanks for sharing Brian!!! I definitely agree setting some goals along the way would be incredibly smart to help get them to where they want to be.

  24. I have a long way to go myself. In order to not think about that as much, instead I focus on how much I can stash away this month…and the next. In terms of fat, the biggest I would think is paying off a home and/or downsizing. Since you’ve paid off your home, have you thought about downsizing to free up cash and have it work for you?
    SMM recently posted…Bye CDs – Well Hello There DividendsMy Profile

    • Honestly, I feel like my house is busting at the seams between having my sister in law stay with us, a kiddo and another on the way. So I haven’t thought about downsizing as much as geo-arbitrage and moving to cheaper locations 🙂

  25. I like how you worked backwards with those numbers. I’m more of a pessimist, so I actually thought the numbers would be worse than they are. Not a bad way to be surprised though. I lean toward saving as much as possible until it gets tedious or affects my health. At that point, I’m all about trying to make more money. I’d rather learn how to make $30 an hour than spend an hour trying to save $10. It’s not easy, but sometimes the only way to go is up.
    Matt @ Profitable Matters recently posted…The True Price of FreedomMy Profile

    • Thanks for sharing Matt!!! I definitely agree that in some ways it’s easier to figure out how to make more money than it is to shave off money after awhile. Definitely a balance.

  26. MSM –

    As you said – it’s about how much $ you spend. Luckily, at this moment, I’m dating my girlfriend, haven’t gotten married yet with no kids. I spend at most $2K in a single month – that includes auto, food, shelter, and everything in between. One thing that I will always say you can control: Minimize expenses, even if you can see what you can do further. Increase your income – always seeing what you can do there. The other area that needs to be considered is that you may have investments producing cash flow for you – so not sure if that is already in or is not in the equation (i.e. side hustles, dividend stocks, online blogging, etc.).

    So for $40K and if you have $1M invested at 4% or use the old tale of 4% rule – then your numbers above seem right. However, what about $30K in expenses or $32.3K… I think you’d be happy to see those results!

    Dividend Diplomats recently posted…Lanny’s June Dividend Income SummaryMy Profile

    • Thanks for sharing Lanny!!! I ran out of time when I posting otherwise I would have linked the calculator so people could have played with it. It’s fascinating to see the differences and if you can get your expenses low it can make a tremendous difference when you reach FIRE.

  27. Yeah, math can be a real kick in the nuts. It feels like a candidate for FIRE needs to have some high income (even if just for a brief period to front load investing), extremely low expenses, or few / no kids. Your friend doesn’t seem to have any of those, but by quantifying the problem at least you’ve identified the levers he has to play with. If his wife works (even just PT after kids go to school down the road) and they find any budget fat to cut, that materially changes the timeline.
    Paul recently posted…The Case for DIYMy Profile

    • Thanks for sharing Paul!!! Math definitely has a tendency not to lie. He definitely needs to figure out ways to earn some more income and reduce some expenses.

  28. Doesn’t surprise me. It ain’t easy but it’s doable if you want it bad enough. I’m big on side hustles. Might as well go all out when I have the energy because who knows if I can keep this up when I’m older. It helps also finding the right spouse who makes a healthy income as well. Even mentally it helps knowing that it’s a team effort type of thing. I think a lot of people in the PF and FIRE community have a scarcity mindset. I don’t want to live a life of extreme deprivation. I like to think that God gave me some great talents I can use to build wealth and not only just for our family. Enough to help fund a lot of our church activities, help missionaries, and possibly do business as missions down the road. All of which requires money. It’s all doable. I think it’s hard and overwhelming when you’re extrapolating using today’s figures. But who said you have to settle for today’s figures? I don’t know. That’s my two cents. I hear quite often that I’m ridiculous and my goals are too lofty. I tune all that stuff out.

    • Thanks for sharing Tim!!! Sounds like the Lord has given you a ton of energy and talents to further Kingdom. That’s awesome news and sounds like you’re maximizing your time!!!

  29. I feel like there’s a disconnect in the personal finance community. Logically and intellectually there is always more fat to trim, but it’s not always worth it. I could save a lot of money and retire a lot sooner by moving to a cheap but unsafe neighborhood in the city. Alternatively, I could save a lot of money by moving way out into the burbs and have a really long commute. Neither of those things are worth it to me at this stage of my life, so I am stuck at my current level of spending on housing.

    I do think that you’re right that a lot of people discount that importance of high salaries in reaching FIRE. Even having FIRE as an option in your life shows a level of privilege that many in America and across the world may never know.
    Matt @ Optimize Your Life recently posted…Brace Yourself for the Next RecessionMy Profile

    • Thanks for sharing Matt!!! I definitely agree that it’s a matter of how “lean” you really want to be in life. At some point you earn money in order to enjoy some of the fruits of your labor. Why be miserable all your life to save a penny 🙂

  30. The numbers aren’t surprising to me, mostly because I’ve calculated them out myself and run them before, but it’s really the initial challenge fo the first $100,000 and the next that really are the barriers. Once you get the first couple in it starts to grow exponentially. The question becomes how fast you can get the initial monies in to have it really take off.

    • I have to admit that things have really started to roll for me and it’s been surprising how quickly my net worth has gone up in the past five years. I definitely didn’t realize how valuable compounding interest is/was.

  31. Back when I was not as financially savvy, a credit card representative gave me a gut check and showed me how much I was actually spending. Even though it was uncomfortable for your coworker I think you did him a lot of good.
    We all want instant gratifications, but unless he starts small, he won’t ever get to $1,000,000. I think it’s awesome you showed him the numbers and maybe give him some hope that small changes could lead to big changes in the future.

    Tom @ HIP
    High Income Parents recently posted…The Financial Implications of the Academic IndexMy Profile

    • Thanks for sharing Tom!!! I definitely agree sometimes blunt advice works better than sugar coating. I’m guessing things are probably sinking in and realizes how much work there really is.

  32. MSM – Great post. I have been doing a lot of number crunching as my goal right now is to figure out how fast I can hit that $1million number. Based on what I have saved so far, my current rate of saving toward retirement, and assuming an 8% average return, I should hit that number no later than 44 (I am 34 now.) Of course the hope is that our income will rise over the years, and we can hopefully find some additional ways to add supplemental income in an effort to hit that number in less than 10 years. Even with the number crunching I have been doing, this chart is definitely eye opening as to what it takes to get there. Time definitely needs to be on your side. While I feel like I am getting started a little late, I am glad that I am still young enough to attain financial independence within a reasonable time.

    • Thanks for sharing Chad!!! My biggest fear with FIRE right now is health care insurance. I have no idea where things are going with rates. So it’ll be interesting to see where it goes in a couple of years when I’m ready 🙂

  33. Slow and steady for the win! It is discouraging when you look at the whole goal like that. But it’s helpful exactly where you used it: to wake someone up to reality when needed. For us, personally, I choose to focus almost exclusively upon the progress and those little inching nudges towards the goal post rather than spend much time thinking about the goal post itself or how long it’ll take to get there. I find it helps motivate me to approach it that way.
    Finances with Purpose recently posted…Happy Fourth of July! (And Some Gratitude Practice!)My Profile

  34. Fantastic post. Really puts things in perspective. I have looked at these numbers many times in the past and continue to track towards FIRE.
    I think the biggest thing I have done towards reaching FIRE is to still live on the same amount as I did 10 years ago. Every raise, bonus, extra income goes into savings/investment. Many friends immediately spend a raise or extra money before it even touches their hands.
    Did the same thing when my daughter left daycare, we had an extra $1,000/month to spend. Wow! Some people bought new cars, extra vacation, new TV’s, etc. We decided to put an extra $500/month on the mortgage and save the other $500/month. Priorities and discipline.
    FIbythecommonguy recently posted…Net Worth Update #3 – June ’17My Profile

    • Thanks for sharing!!! The best advice that I ever received was any raises or bonuses push into your 401k until you max it. It took me 7 years but I finally did it and I’m so glad that I did. My investment balance definitely looks a lot nicer these days 🙂

  35. As someone who wants to be a father of just one child I can say that my wife, even though she wants too, won’t be able to stay home (or at least full-time). And the numbers do seem disheartening, but when I think about my own FIRE number if things continue to go the way they are going I will hit that number within 8 more years. Yes, still a long way to go, but by then the mortgage is done, my student loans are done, and I will have my number. I have been saving for 11 years so I am already 1/2 way there.

  36. MSM –
    What’s magical about hitting $1,000,000? Seems like many/most of the Personal Finance – Financial Independence/Retire Early web sites/blogs advocate Bengen’s and the Trinity Studies “4% SAFEMAX” or Sustainable Withdrawal Rate as gospel. However, more recent academic work has shown going forward a 3% rate is more likely to be safe rate of withdrawal (for a retiree, not a 35-or 40-year old).

    And, while compounding an annual return of 8% is easy to do in an Excel spreadsheet, the actual year-by-year returns of investing in say the S&P 500 make “staying the course” very, very difficult for many investors (humans dislike losses about twice as much as they like gains–and investing in stocks over the long term means exposure to serious declines.

    Here are S&P 500 returns for this century:
    2000 -9.03%
    2001 -11.85%
    2002 -21.97%
    2003 28.36%
    2004 10.74%
    2005 4.83%
    2006 15.61%
    2007 5.48%
    2008 -36.55%
    2009 25.94%
    2010 14.82%
    2011 2.10%
    2012 15.89%
    2013 32.15%
    2014 13.52%
    2015 1.38%
    2016 11.74%
    If one is just starting out investing, three years of negative returns would be terrific, stocks are on sale. But, most people have a hard time buying stocks when there is bad news.

    Here is a link to a site that has historical returns that are thought provoking for individuals who want to know a bit more about how hard long term investing is, which is WAY harder than getting 8% a year every year.

    It’ interesting to read how individuals “will get to FIRE in 5 or 8 or x# years”. I always wonder, “based on what assumptions?”

    If they are planning on earning 8% annually on their investments, I wonder how that’s going to turn out.

    • Thanks for sharing Dave!!! I think for me I always thought the 7 figure mark was a big deal as I didn’t know too many millionaires growing up. But like you it’s an arbitrary number.

      In terms of the numbers above. For me, when I graduated college in 2003, my return would have been higher than the 8% 🙂 But can see how those that started investing in 2000 would be disappointed.

  37. Thank you for this post! I think this side of the story is not shared enough in the FIRE space. I keep reading and hearing people say that they were spending too much and once they cut out some of the fat, they were on track to retire early in a few years. It’s not always that easy. I think I’ve been rather frugal for 15 years but income and cost of living matters a lot too.

  38. 8% may be realistic in a very long term plan but if you do a ten year average you could be in one of the valleys, and that is part of the problem. If you get lucky the 30 year plan is perfect, if you don’t then you have a whole new problem. That problem can be managed but you better know what you are doing.

    Your co-worker realized his new problem but he does not know where to start. You can go several different routes, but at the same time. Slash spending and up income at the same time (maybe his wife could watch two other kids, or he could), slash spending drastically and both work, both get more training and up their careers. Each couple has to make their own choice.

    My advice to everyone who is married is you have to have a continual discussion about this (hopefully before kids), at least once a month, and everyone has to be involved.

    • Thanks for sharing Dale!!! I definitely agree that over the short term that things can definitely fluctuate. Over 30 years it would definitely seem to be a bit more stable.

      And to echo what you said it’s so important to be on the same page with your spouse. Money is so important to talk about and not bury your head in the sand about 🙂

  39. I mean, they could work part time jobs when their kids are in school so they wouldn’t have to save for quite so long and still have time with their kids. Could that work?

    • That’s a great suggestion Elizabeth. I definitely think they were looking to fully retire but going part time would definitely be a great way of earning income when kiddos are in school.

  40. I think an 8% return is extremely optimistic. I have been tracking ours for a lot of years and we average 6.4%. We never stop investing during down markets (in fact, we have always increased investing). We keep an age appropriate asset allocation, and we find the lowest fees possible.
    However, our average net worth increase during the same time is 11%, but that is from being serious savers.
    We are about 10 years out from retirement (healthcare willing) and wouldn’t even consider retiring with less than $2.5M.

    • Thanks for sharing AnnieG!!! Sounds like you are doing really well. $2.5m in 10 years sounds like you will be able to do exactly what you would like in retirement. That’s awesome to hear!!! Congrats!!!

  41. You know, if your coworker absolutely cannot solve for expenses, then I hope he’s open to side hustling. There are only 3 tenets to personal finance:
    1. Spend less than you make
    2. If you can’t do that, make less than you spend
    3. Invest the difference

    Finance tips and hacks all fall under one of these 3, and it seems like your coworker would benefit from thinking about #2. Basically make himself and option when none seems available. Best of luck with your coworker!
    JT recently posted…Why High Paying Jobs Aren’t Worth It and What to Do InsteadMy Profile

  42. JT your second point, “If you can’t do that (spend less than you make), make less than you spend” should be (I think): If you can’t do that, make more than you spend.” And doing this, making more than you spend means working overtime or picking up a part time job, or to FIRE fans, a side hustle.

    Your point is well taken in that there are two sides to the equation to get individuals to saving (and eventually investing) money: (1) spend less than your earn or (2) earn more than you spend. Both sides of the equation are important and merit serious attention.

  43. It becomes a choice of priorities. Do they want to get out of debt? Or buy a house? Or start a family with a stay at home wife? Or have $1M? Based on the info, I don’t see all 4 happening at once. It is usually a progression. Unless there are medical concerns perhaps wait on having kids a few years? Or make the goal $1M eventually. I understand the rent vs buy debate, but it is worth it to take time to buy.
    I am currently single, finding a partner and having kids would derail my current FI plans. I’m ok with that, because my life would change in new and wonderful ways.
    I also know FI for me will mean some sort of work, but I will have the ability to negotiate and choose because of being FI. We had a big wake up with my dad having a heart attack (and surviving) at 62. It was close though. He had been retired out of a position and hadn’t gotten a new job which greatly reduced stress of returning to work during recovery. But there’s no way I’m taking the risk of working until 65.

  44. I was thinking about this the other day as well. Nice chart showing how much you save each year and how long it would take to retire with $1 million. Not really sure if that is enough money to retire on.

  45. This is technically depressing… As a single income family, there is no way to hide away over 750$ a month, plus save money for vacation every year and perhaps buying land , which we are currently looking into. We save quite a bit as it is, and a small part we use for a vacation but unless we come into a lot of money, it’s likely to never happen. My philosophy is to create a life that can sustain for my entire life, so I need to have a business that I could run when society says I’m supposed to retire. So I’m no longer fixated on the fact that I need to save money for retirement…

    • Thanks for stopping by Lisa!!! The numbers are a bit tough to swallow which is why when I see those ads that you could be a millionaire if you skipped one latte I want to share that there’s a little more that goes along with it 🙂

  46. I’m not sure where $1 million comes from…a million used to be a LOT when I was little. Now, it’s not so much. And, when I retire, it will be even less (NPV). I thought you want your monthly expenses (once you retire) to be just 4%. I think we’ll all need a lot more for retirement…don’t forget medical expenses.

    Here I’m in high cost of living area, so not sure how much $1 million would cover/how many years. Yes, I suppose my high mortgage would be taken care of, but there are still real estate taxes and in my case common charges and for all maintenance charges/upkeep, etc.

    I suppose if you are 60 or 65 maybe a million might do, especially if I moved somewhere cheaper like Florida or something. But, I’d need a pool…and to pay for that pool maintenance LOL.

    But if millenials are talking about a million to live on at an early age (e.g. 30-40 or something), it’s doubtful that’s enough. And, what about college? Are they planning to send their kids there.

    Anyway, all that aside, they key to any of this is growing your topline. There’s only so much cost savings you can find. Same for a business. Focus on growing the top line…make more money, sell more stuff, etc. Even without cutting margin, that will get you there.

    • Thanks for sharing Debbie!!! I totally agree with you. A million dollars isn’t what it use to be. The cost of living only increases each year so it’ll be interesting to see what a million dollars is really worth in a couple of years 🙂

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