I have worked at large banks and insurance companies for more than 20 years. I hit $1 million in my savings at 48 years old, almost three decades after I made it a goal. Being passionate about personal finance and wealth building helped me make it happen.
After graduating high school, I left my family in Jamaica with only $100 to my name, and went on to have a successful career. For a poor girl like me, moving to New York was a once-in-a-lifetime opportunity that I intended to use to break the cycle of poverty in my family.
I was not able to go to college immediately because I was an illegal immigrant, so I returned to high school to get my degree, and also got a part-time job at a local restaurant making $75 per week.
I paid a weekly stipend for meals and accommodations for my family and friends, and kept a budget. I put the rest toward college savings and sending to my family in Jamaica.
I set a goal to have $1 million in my retirement account by the age of 50. I set some guidelines for myself to make that goal a reality. I did five things.
I lived on $50,000 per year after taxes at 32 because I was making more than $100,000 and putting the rest into savings. When I got married or had kids, I would revisit my budget, make adjustments, and continue to save toward my retirement goal.
We lived below our means by buying only used cars, buying only secondhand clothing for our children, and only giving gifts once per year.
I have always contributed the maximum amount possible to my employer's retirement plan as I have progressed in my career.
I put 5% of my salary into my 401(k) when I worked as a word processor in my early 20s.
When I had two kids in a three-year span, it was hard to contribute the maximum. Even though expenses changed, I continued to contribute the maximum amount I could.
Automatic transfers from each paycheck were set up in my IRA when I opened it at the age of 27. The funds in this account were used to purchase a mutual fund. I contributed $8,000 over the course of five years. I converted this account from mutual funds to stocks that did well, and it now has $40,000.
The IRS has rules in place that if your income exceeds a certain dollar amount, you can not contribute to a Roth IRA. If you are single and make more than 144,000, you cannot contribute to a IRA.
Rich Dad, Poor Dad was one of the first books I read when I began my financial journey. One Up On Wall Street by Peter Lynch and The Intelligent Investor by Benjamin Graham were two books that helped me in my investing journey.
I began to build my stock market and investing knowledge through auditing pension plans and mutual funds while employed at Deloitte. Kiplinger, CNBC, Forbes, and Money are personal finance websites that I followed.
I founded a stock market investment club after college. We would research individual stocks and industries to make at least one recommendation at each monthly meeting. We invited guest speakers to help build our knowledge of the stock market.
The knowledge I gained from this club helped me grow my retirement portfolio.
I wanted to have more control over how my retirement funds were invested, as my investing knowledge grew. I wanted to avoid annual administration fees that my employer charged, so I rolled over my 401(k) to a brokerage firm where I was able to invest in a wider variety of funds and individual stocks.
Since I was still young enough to take more risks, I closely followed the stock market and purchased stocks that were performing poorly but that I thought would eventually increase in the long term.
All Rights Reserved © 2024
