Apparently it’s still possible to save a fortune — without being a “workaholic”. Picture: iStock
Apparently it’s still possible to save a fortune — without being a “workaholic”. Picture: iStock

29yo saves $460k without ‘six-figure’ wage

A 29-year-old savings expert has revealed the eye-watering savings he's managed to amass - despite not being a "workaholic" or earning a "six-figure salary".

In an article for Business Insider, the US blogger and financial analyst - who goes by the pseudonym Sean "The Money Wizard" Potter - announced he had $US312,000 ($A459,000) in his investment portfolio.

He said the yearly returns were nearly half of his earnings from his day job and said he had discovered "your money can work a lot harder than you can".

He also shared a breakdown of his savings journey, having put aside $US149,844 ($A220,709) by September 2016.

A year later, it was $US202,942 ($A298,918) - followed by $US271,569 ($A400,000) in September 2018 and $US312,918 ($A460,905) last month.

"Looking back on the progression, I still have a tough time believing the pace," he wrote.

"Growing my net worth by anywhere from $US50,000 ($A73,646) to $US70,000 ($A103,104) a year for three years straight might make you assume I'm sort of a workaholic or mega-earning businessman.

"Here's the truth: I work 40 hours a week, enjoy my weekends, and take plenty of vacations. And I've never even earned a six-figure salary."

He said his career added around $US6000 ($A8837) per month to his overall wealth - but his "portfolio's returns outgrew my salary in six of the past 12 months".

He explained that while "investment gains can be volatile", his investments have grown "at a rate around 10 per cent per year for the past several years".

"Through diligent saving and living frugally, I've built my net worth towards a total value of roughly $US315,000 ($A683,397). Assuming nothing else, even just 6 per cent returns on that … equals $US15,750 ($A23,198) per year.

"What does this mean? It means that even if I personally start slacking in bringing home the cheese, my portfolio is still working away to bring in a $US15,750 salary."

The money guru says he has discovered his money works harder than he does. Picture: iStock
The money guru says he has discovered his money works harder than he does. Picture: iStock

He said in 2018 he saved $US36,253 ($A53,398) from his wages.

"If my portfolio also earns an additional $US15,750 ($A23,198), that's an amount of money that would otherwise take me at least five months to save," he wrote.

"I could slave away at a desk job, day in and day out for five months straight. Or, I could just have a $US315,000 ($A465,000) portfolio, which by itself, automatically spits off five months' worth of my usual savings. Every year. For doing nothing."

He said he believed his strategy could build him a $US1.5 million ($A2.2 million) portfolio in time - a goal that's "entirely achievable through consistent contributions and compound interest".

He said saving as little as $8 a day could make a huge difference to your net worth.

"Every dollar you save makes you exponentially richer. And over time, each dollar works harder and harder than the last," he told Business Insider.


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