Monday, July 13, 2020

Net Worth Growth - from Zero to Million

How long it required for an average employee to achieve $1 Million net worth? 

It took me 13 years to grow my net worth from zero (or negative if take into consideration of study loan) to $1 Million.

This is not impressive and I missed my personal goal - achieve $1 Million in 10 years. However, I still feel glad that I have finally achieved it! (better late than never)

Referring to my monthly net worth tracking, below is the breakdown of time required to accumulate $100k.

First $100k   : 6.2 years 
2nd $100k    : 13 mths
3rd $100k    : 9 mths
4th $100k    : 11 mths
5th $100k    : 13 mths
6th $100k    : 7 mths
7th $100k    : 8 mths
8th $100k    : 7 mths
9th $100k    : 8 mths
10th $100k  : 9 mths

What surprised me the most is it took me close to 50% of 13 years to reach 1st $100k net worth, before I manage to accelerate my net worth growth from year 7 onward.

Looking back my historical records, few main elements which support the growth:

1. Increase in salary 
    
2. Slower increase in spending vs salary 
    I do see my saving: income ratio increases from 10% when I start work to > 50% as of today.

3. Dividend income

This is my first milestone toward FIRE! 

I hope 2nd milestone will take < 8 years.

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