★ How I Built Our Net Worth to $1 Million

net worth - personal capital

[Please welcome special guest Mr. 1500 today!]
I started out on January 1st, 2013 with $586,043 and crested the million dollar mark for the first time 800 days later on November 28th, 2014. While I still have some debt in the form of a small mortgage, I’m closer than ever to sailing off into that sunset.

Today, I’ll tell you my story.

7 Years Old to College Graduate ($0 to $60,000 in Debt)

mr 1500 & daughterAs far back as I can remember, I was always a hustler and a saver. When I was 7, my parents paid me to do chores around the house. I earned $2/week picking up dog poop, mowing the lawn, trimming bushes and whatever else my dad didn’t want to do. If I broke down my time, I was probably making less than a quarter an hour. I never thought of it like that though. I enjoyed putting those two George Washingtons into my little cash register bank every week. Back then, $10 was a huge amount of money.

When I was a little older, I expanded my operations. If it snowed, I was the kid knocking on doors, ready to shovel your driveway for $2 ($5 if the snow was really heavy). I delivered newspapers. I mowed lawns. And I saved all of the money. This was in sharp contrast to my younger sisters who didn’t enjoy working, but sure liked to spend. I earned the name, “Mr. Cheapo,” from them for my frugal ways. They laughed, but it was a badge of honor.

At 14, I started at my first official job, working at a fast food restaurant. From that point on, I’ve always had a job. In college, I worked at a computer lab. During spring and summer breaks, I’d find work through temporary agencies.

I majored in biology and chemistry in college, but wound up working as a computer programmer. I also found myself with $60,000 in college loan debt. I was determined to work hard and quash those loans as fast at possible.

First, let’s back up a minute, though, to talk about my money education. Or lack of it.

My Money Education Begins (Better Late Than Never)

I had almost no financial education growing up. My parents weren’t good with money and, in school, I had one semester of consumer education. That class taught me that I should balance my checkbook and compare prices at the grocery store. It taught nothing about compound interest, mortgage amortization or anything to do with investing. However, my mind was receptive in the rare cases when valuable information presented itself.

One day, I was working in the back room of a pharmaceutical warehouse. On the radio, someone had turned on an AM show about investing. I’ll never forget what one of my 50+ year old co-workers said:

“If I only had this information when I was in my 20s, I’d be rich now.”

My ears perked up. He went on to say that saving when you’re young is critically important. Luckily, I was only 20 at the time. Around that same time, a girlfriend took me to an investing seminar. At one point, the guy speaking looked at me and said:

“Your advantage is your youth. Start now.”

The lessons sunk in. I hated being broke.

401ks and Flips, Oh My!

When I started at my first job post-college, along with paying off those loans, I signed up for the 401k immediately and began saving. I also bought my first home for $140,000. It was a starter house that wasn’t pretty, but had a great location. I made modest improvements like putting in tile and painting. With a strong real estate market at my back, I sold the home a couple years later and made $100,000 in profit. My wife and I looked at each other and said, “Hey, let’s do that again!”

remodeling & flipping houses

Some of the work I did in my flipping adventures.

We sought out ugly houses in great neighborhoods. If a house had pink toilets and green appliances, our eyes lit up with joy. We’d move in and, over the course of a couple years, make the home beautiful.

Even more beautiful was the money we made. The US tax code has a provision where you don’t have to pay capital gains on a home sale if you’ve lived and owned it for 2 of the past 5 years. We made healthy amounts of money, that way, which was either reinvested in other property or stocks.

The Great Recession Leads to Our Great Failure

In 2006, we purchased what we thought would be our ultimate flip. It was a lake home with sunset views of the Madison, Wisconsin skyline. The home set us back $535,000, but that was OK since we figured we’d sell it for a million when done. Queue the ominous music.

Almost immediately, we started work on the home. We paid carpenters to tear the roof off and build a second story. After they were done, I installed wood floors in the common areas, built the bathrooms, installed fixtures, gutted and rebuilt the kitchen, gutted and remodeled the first floor bathroom, and built a sprawling deck.

Our million dollar dreams may have come true except that the Great Recession happened. The value of luxury homes dropped through the floor. Some of the houses around us went into foreclosure. But we trudged on. We told ourselves that the values would recover. They did, but not quickly. In 2012, we sold the home for $200,000 more than we bought if for. However, we had put $200,000 into it and at least 1,000 hours of labor. It was a setback. Had we never purchased that home and just invested all of the money, we’d be hundreds of thousands of dollars ahead.

lake house mistake

The mistake by the lake.

The whole time we were working on the house, I didn’t check my investments. I kept contributing to my 401k, but with the intense stock market drops and the intense remodeling spending, I just didn’t want to see my balance.

The Final Journey to $1 Million ($550,000 to $1,000,000)

city skyscrapers

When I realized I had hit a million, I walked out of the train station in a zombie-like state and took this picture.

I had a bad day at work in October 2013 and, for the first time in my life, considered retiring long before the age of 62. It was time to see where my finances were at and how much I needed to quit. I was pleasantly surprised to find that I had about $550,000 in investments. I also figured out that it would take me about 1,500 days to reach my goal of a $1,000,000 which would fund the rest of my existence.

Inspired by Mr. Money Mustache, I started writing about my journey. With strong market tailwinds, I become a millionaire for the first time on November 28th, 2014 at the age of 40. I was in downtown Chicago when I checked my Personal Capital account and saw the two commas.  I was numb. Almost one year later, it hasn’t sunk in yet and probably never will. I’ll always feel like the poor kid I was growing up.

net worth - personal capital

This feels good!

How I Built Our Net Worth to $1 Million

  • Saving is absolutely my first priority: Maxing out contributions to tax advantaged accounts like the 401k comes first. I’d rather walk to the grocery store in a blizzard than not max it out. I’d rather eat beans and rice for a year than not max it out. I’d rather… well, you get the picture. Despite the fact that I’ve had some high-fee funds in past 401ks, those pre-tax accounts are now worth north of $600,000. Never let someone tell you that 401ks are a bad idea. Even with high fees, the tax advantages make them worthwhile.
  • Don’t get smart: I admit to buying stocks, but I think that it’s a very dangerous idea. Remember that for every stock you buy, there is someone on the other end who thinks it’s just as good of an idea to sell. See Jim Collins’ excellent Stock Series.
  • We live a modest life: My 1,900 square foot home fits our family of four just fine. My 2003 Honda Element has almost 150,000 miles on it and I expect to drive it for another 150,000. We live in a quiet, safe neighborhood and cook our own food.
  • Work very hard when you’re young: Working at a job from 7-4 and then remodeling a home until 10pm for months on end is hard work. Before that, for at least half a year, I put in 80 hour weeks at my job. However, those long hours were an investment that paid off handsomely. That money we made from house flips was all saved and invested. Those 80 hour work weeks led to rapid promotions and pay raises. The thought of having at least half of my life free of work more than makes up for those late nights swinging hammers and writing code.

It Was Never About Money

My goal of a million dollars is a bit trite and superficial. However, if you dig a little deeper, you’ll see my true objective. The money will never be about buying a nice car or a big house. I’m content with everything I have right now. If I find myself with $5,000,000 or $10,000,000 some day, you’ll still see me under my Element, getting my hands dirty changing the oil. The money is just a facilitator.

It all comes down to living life on your own terms. If you have to work, some other person has control over you. Part of your life must be handed over to him or her. My best life is when I’m in full control. I want to be able to spend summer hours with my girls hiking or traveling. I want to build crazy things in my garage. I want to be able to exercise and read for hours every day.

It was never about money. It was always about freedom.

throwing daughter air
*********
About the author: Mr. 1500 holds the 10th position on Rockstar’s Ultimate Net Worth Tracker, and is the founder of 1500 Days – a blog about his journey to financial independence/early retirement. The name comes from the amount of days he thought it would take to accumulate enough assets to quit his job, never having to work again.

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Last modified: April 7, 2017

69 Responses to :
★ How I Built Our Net Worth to $1 Million

  1. Freedom, yes! The lake house looks beautiful. Sorry it didn’t quite work out for you.

    1. Mr. 1500 says:

      Thanks Mrs. Whip! That house was beautiful, but Financial Independence is even more beautiful!

  2. Jeff says:

    This was the first blog I’ve read today and I can’t imagine reading another more inspiring.

    1. Mr. 1500 says:

      Thanks Jeff, I’m glad that I inspired you! Comments like yours inspire me too.

  3. Great journey!

    I gotta admit, as a real estate junkie, the main thing I was thinking was… damn, that lake house looks sweet! I can imagine sitting on the deck overlooking the lake at sunset. Those are the things I enjoy spending money on.

    Sam

    1. Mr. 1500 says:

      Sam the sunsets were spectacular! If I was home when the sun went over the horizon, I was out back watching it.

      However, the taxes weren’t so spectacular. Today, the annual tax bill on that home is $15,532. Dane County, I love you, but your taxes are oppressive.

      1. DANG! That is a HUGE tax bill for what I’m guessing is a property worth less than $600,000? We talking 3% property tax rate or something?

        I’m waiting to get approved to build my deck out back facing west. I need to be out in the sun. It makes me happy.

        1. Mr. 1500 says:

          “I’m waiting to get approved to build my deck out back facing west. I need to be out in the sun. It makes me happy.”

          Truer words have never been said.

          Building decks is fun! If I was out there, I would help you. I’d even show up on time and do everything I promised to do.

  4. Michael Mota says:

    Great article !! I enjoyed reading it. Gives me hope to reach my first million.

    1. Mr. 1500 says:

      Thanks Michael! Remember that hard work trumps all.

  5. Nice! Investing in real estate can be particularly attractive because of the no capital gains on a primary residence rule. Kudos for making a plan, working hard, and getting to the finish line!

    1. Mr. 1500 says:

      Yeah, the no taxes provision was great! There are definitely drawbacks to this strategy (living in a house coated with drywall dust immediately comes to mind), but the money more than made up for everything.

      1. Haha, yeah I bet constantly living in the middle of a renovation gets old. We repainted most of our house after we bought it and just a couple of weeks got old fast. Way to power through and get it done.

        1. Mr. 1500 says:

          Man, our current one started June of 2013 and drags on to this day. The worst is behind us, but I really don’t like projects that go on forever. Without kids and a job, I would have had this thing done a long, long time ago.

  6. Jeff says:

    What a lot of people dont know (that I do) Mr 1500, is that picture of you with the “Welcome to Colorful Colorado” Hat on is that that hat was free – though I suspected you had to drive a bit to get it unless someone has given it to you.

    Congrats on the milly. When you finally do take the plunge, I’ll be there for the party (with beer!)

    1. Mr. 1500 says:

      Yeah, the folks at the Colorado Welcome centers used to hand those hats out. Sadly, I lost mine last year.

      You’re invited to the party!

    2. Amy says:

      I’ll come up from Parker for the party, too!! Great article!

      1. J. Money says:

        I want an invite!! ROAD TRIP!

        1. Mr. 1500 says:

          J$, you have to make it out to Colorado sometime. We have an extra room and our ceilings are tall enough to accommodate your hair.

  7. Such a great story! I love that you don’t make a crazy salary and didn’t strike it rich with some investment. Your story illustrates that hard work and smart decisions over a long period of time adds up. Anyone can do that!

    1. Mr. 1500 says:

      Right on Ali! You nailed it. Patience and perseverance with a whole lot of hard work thrown in. It doesn’t take much either since most are content with normal/boring lives.

  8. That darn recession! Well you really worked hard for where you are at today and I admire that. Everything comes with ups and downs and im happy to hear you have reached pivotal goals.

    Like you, for its not about the money. I really dont think about how much money I want in the bank, right now all I can really concentrate on is building enough passive income to be able to live the same life Im living now without having a day job. I dont want fancy cars or a huge house either. I have everything I want right now minus the day job!! ha!

    Great read!

    1. Mr. 1500 says:

      “I have everything I want right now minus the day job!! ha!”

      That pretty much sums it up!

  9. Kurt says:

    “I admit to buying stocks, but I think that it’s a very dangerous idea.” Wonderful to at last find someone (anyone!) in the personal finance blogging world who agrees with me on this point! :-)

    1. Mr. 1500 says:

      Just to clarify, I’m OK with buying them in for form of low fee, funds that I plan to hold for at least a decade, but preferably longer. I’d suspect that very, very few people can successfully pick stocks and beat the markets over multiple decades.

      1. J. Money says:

        Agreed. Which is why we all turn to the lazy – but proven – index funds! With the bad ass Vanguard!

        1. Mr. 1500 says:

          Vanguard is the best. Jack Bogle, you’re an icon.

          1. Michelle says:

            Love. Vanguard. (And they don’t need any advertising…Good old “word of mouth.”) I’m so glad I started investing in them as soon as I started earning an income! (P.S. I’m from WI too! I no longer live there but it will always be my home.)

  10. You have shown the rest of the world that it is possible to become a millionaire without making big dollar salaries. You can make mistakes and recover. It is a matter of focus and willing to do some work to get ahead.

    Congratulations on your one million dollar net worth and continued success toward reaching your goal of 1500 days!

    1. Mr. 1500 says:

      Yeah, work hard and don’t get fancy. Stay the course and be rational.

  11. I completely agree, it’s about freedom, not the money. Your story is very inspirational on how hard work and a desire to have financial freedom pays off. Great post and congratulations!

    1. Mr. 1500 says:

      Thanks JenZ! Freedom is everything. Money is a very powerful tool that you can do many things with. I will use it to buy time.

  12. Stockbeard says:

    Wow, you doubled your 500’000 to a million in approximately a year? That’s some strong tailwinds there :)

    1. Mr. 1500 says:

      Nah, doubled since January of 2013. Still not complaining! I’ll take that ANY time.

  13. I never cease to be inspired when I read about your journey Mr 1500, especially how hard you worked! Snaps me back to reality when I find myself dreaming of easy ways to earn my own freedom…

    1. Mr. 1500 says:

      Work your ass off! It will happen.

  14. Double Comma Club! Nicely done. Lesson I’m teaching my children. Hey how would you like to be a millionaire, usually gets a teenagers attention. :)

    1. J. Money says:

      Double Comma Club – hah! I’m totally using that for the day I hit $1 Mil :)

  15. TheMoneyMine says:

    Congratulations Mr. 1500, you’ve made it to Freedom!

    All this hard work has paid off. No need to be a Wall Street trader to have a 1M$!

    Spend wisely, be interested in what your money is doing, hustle and connect with other like-minded people. Eventually the benefits compound over the years and generate impressive results!

    This is such an inspiring story for everyone on the journey to Financial Independence. You’re a great example that It Can Be Done!

    1. Mr. 1500 says:

      Right on Money Mine, all great tips! Out of all of those, the money is the easy one. Connecting with like minded people is hard. We are few and far between and we tend to fly under the radar. No flashy car or McMansion for us folks.

  16. Congrats in hitting $1mil! I love how you say that it’s not about the money, it’s about the freedom. Couldn’t be more true!

    1. Mr. 1500 says:

      Absolutely. Money is a powerful tool. Wielded correctly, you can buy an awesome life with it. And that life isn’t about things!

  17. “My best life is when I’m in full control.”

    Truer words were never written. Self-determination is so powerful. I hope each and every person, as some point in their lives, gets to experience it. Once we get a taste, it becomes an addiction…one we fiercely defend.

    1. Mr. 1500 says:

      Yeah, I’m not even there yet and I’m totally addicted! However, I sleep well knowing that I’ll be able to get there long before I turn 45.

  18. I found this story linked from his “1500 Days” site. I really like some of the ideas he has and I especially enjoy how he is not afraid to admit his mistakes. I admire that he can live a modest lifestyle, but not jump onto the ultra-frugal, live out of your car and eat only bread, bandwagon.

    I just started documenting my journey to financial freedom and hope to be as successful as he has been!

    -DP

    1. Oh, and most importantly, it really isn’t about the money, it’s about the FREEDOM!

      1. J. Money says:

        Documenting helps immensely! Best thing I’ve ever done for my money :)

  19. Kick ass! The $1m mark is an amazing accomplishment, especially while young. You’re right, saving your dough is key – there’s simply no other way to get rich, even if you’re pulling in $10m a year. If you don’t save, you’ll never truly have anything in life. Well done!

    And it sounds like you aren’t just under your Element. You’re also, most definitely, “In your Element!”

    …I crack myself up sometimes.

    1. Mr. 1500 says:

      Ha, thanks Steve! Long live the Element! Both kinds!

  20. Even Steven says:

    And #5 for the current Financial Independence Day tracker, http://www.evenstevenmoney.com/financial-independence-day/

    1. Mr. 1500 says:

      #5. Well, I’m too late to be #1, but maybe I’ll be moving up a couple slots soon…

  21. That Guy says:

    Nice article. Okay I’m going that obnoxious guy that points out that Jan 1, 2013 to Nov 28, 2014 is actually only 696 days. On the positive that makes your story even more impressive!!!! Can you share some insights on your investment portfolio? Do you follow any specific diversification plan? Was that doubling of your investments driven by cashing out of the Madison house? I’ve compared it to my investment portfolio balances and it grew from $330K to $618K over the same period — so I was almost able to double my investments as well. Sadly this year has been a bit of a dud with the market.

    1. Mr. 1500 says:

      Wow, how did I botch that one up? I’m not even close. Thanks for calling me out!

      I sold that house before the blog started, so the numbers don’t include that. Details of my portfolio can be found: http://www.1500days.com/1500-portfolio-part-1-rare-insights/
      http://www.1500days.com/1500-portfolio-part-2-rare-leadership/
      http://www.1500days.com/thursday-rant-1500-portfolio-part-3-no-empire-lasts-forever/

      I need to do another update though and will soon.

  22. Kim says:

    Have you ever had a post where you go over your monthly budget/expenses?

    1. Mr. 1500 says:

      No, but that is a great idea. We currently get by on 3-4K/month. $1150 of that is housing (mortgage, property taxes and home insurance). Another $700 is health insurance. The rest is for food, utilities, gas and everything else. Housing costs won’t go down in retirement, but everything else will.

  23. This is great! I love reading these stories and seeing how hard work and dedication pay off. Hope to join you in the millionaire club one day!

    1. Mr. 1500 says:

      Thanks Elle! Work hard and your craziest dreams can come true. I’ll save a seat for you at the Double Comma Club!

  24. So well articulated, per usual. Your point that it’s not about the money is what I try to convey to people as well. Mr. FW and I honestly spend very little time thinking or talking about money itself; our focus is 100% on giving ourselves the freedom to spend our time as we wish–not as we have to.

    Also, this cracked me up because we’ve done both of these things–“I’d rather walk to the grocery store in a blizzard.. I’d rather eat beans and rice for a year” hah! Although to be fair, we only ate the rice and beans for lunch, not for every meal :).

    1. Mr. 1500 says:

      “Mr. FW and I honestly spend very little time thinking or talking about money itself; our focus is 100% on giving ourselves the freedom to spend our time as we wish–not as we have to.”

      It is so incredibly liberating and empowering once you realize that life isn’t about money and stuff; isn’t it? It can be difficult to grasp because a lot of us aren’t brought up to think like this, but once you do, it’s an epiphany.

      And we still haven’t tried your recipe! Once the the cool weather rolls around, we’re going to go for it!

  25. Aubrey says:

    Good read.

  26. Fervent Finance says:

    This post has definitely been making its way around the interwebs, congrats! Wait so you’re saying hard work, spending less, earning more, and consistency pay off? :) Such a simple concept, but people don’t see it that way. You did a great job of spelling this out for people. Keep it up Mr. 1500!

    1. Mr. 1500 says:

      And you know what? The success of this post is due to a whole of hard work. I’ve been blogging for almost 3 years now. I don’t write as well as some of the big dogs, but I’ve improved. This is because I’ve already typed hundreds of thousands of words at 1500 Days.

      Never forget that the luckiest folks are also those who work the hardest.

  27. JMAR says:

    Mr. 1500,
    Your story is very inspiring! On average, how much did you save each month pre tax and post tax?

  28. BeSmartRich says:

    What a great story. Thanks for sharing. I am looking for other income streams to boost my net worth. Cheers!

    BSR

  29. Cary says:

    Very inspiring blog! Shows what patience, determination and goal setting can achieve. Looking forward to more good reads.

  30. Shannon says:

    I’m a late comer to this brilliant post, but had to comment anyway. Thanks for sharing your history and your advice. What an amazing inspiration.

    1. J. Money says:

      Glad you enjoyed it :)

  31. S. Mac says:

    Nice article. I, too, am an aggressive saver and frugal spender. I just hit the $1MM mark this week.

    1. J. Money says:

      oh wow, congrats! that’s huge!

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