Case Study #5: Zero to 2.6 million in 25 years

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In Case Study #4 we looked at reader EmJay’s potential transition from a current corporate career into a new life funded in part by his financial independence. A family man at age 48 and with 2.6 million in net worth, the conclusion was he easily had the resources to chart and enjoy this next, freer stage in his journey.

The longer I write this blog the more I am struck with the incredible range and diversity of the readers here. Very much as with the Chautauqua attendees described in A Week of Dreams.

This range is on best display in the comments, where readers ask questions and exchange ideas with me and each-other. For my money, some of the most interesting information is to be found in these conversations. The questions expand and clarify the topics the posts introduce.

But be that as it may, I am also aware that many blog readers skip reading this material all together. It is for this reason I occasionally move especially striking comment dialogs into the post as addendum. And it is how this follow-up Case Study came to be.

Not surprisingly, for those readers just starting their own financial journeys, there is a keen interest in what the path from Zero to 2.6 million in 25 short years actually looks like.

Reader Tom asked exactly that in Case Study #4’s comments and EmJay graciously provided a detailed reply. What is striking to me is how ordinary this path is.

Certainly EmJay and his wife had successful careers. But they also started out with quite modest incomes, elected give up one of those incomes to have a stay-at-home spouse once their son was born and there is a failed business venture in the mix. Yet, in the end, the results are very impressive.

So why is EmJay a multi-millionaire when just a few years ago the news programs were clogged with stories of other manager and executives a few short months from losing their houses? Here’s what jumped out at me:

  • EmJay and his wife married a bit later in life and after their careers were starting to roll.
  • They had their son after they had established some financial stability.
  • They share similar financial attitudes.
  • They stayed married. Perhaps those first three points helped?
  • They started investing early.
  • They maintained a high savings rate.
  • They learned from their mistakes and moved on.
  • They didn’t panic during the big crash of 2007-9.
  • They avoided lifestyle inflation.

That’s my take, anyway. Here’s what they both had to say in their own words. My editing reflects only formatting. Enjoy!


This is actually not Tom.

From Tom:


Thanks again for a great post! I stumbled across your blog earlier this summer and have spent the last few months catching up from the beginning, now if I could only get my parents and girlfriend to read the stock series!!


Question for you and any other readers for that matter.

I believe I’m one of the fairly younger readers here (25) and recently have gotten very serious about savings, cutting expenses as well as building my income (from work & recently, in 2013, attempting to find other ways – investing, etc.) As I have begun to do this, its apparent I missed out on a few things those initial years of working, maxing out 401K, investing my excess cash instead of letting it sit in a bank account, etc. With that in mind, I have made it a serious goal to grow my income as fast as possible, so the compounding effects will be felt later on.

Now for that question –(do not feel obligated if you would rather not share further details)

Through the course of your career, what is the level in which you achieved that income that would were satisfied, and knew could bring you to this end result? Based on your net worth it seems like you may have been making that salary over 100K for quite some time. Is this a level that you have just built up to over the course of your career? Or were there times that it was higher and you have adjusted/switched positions for lower salary as you became closer to FI?

I think this may be an interesting topic to look into and could greatly benefit the younger readers — What should be the typical growth of salary year by year (for your main source of income) to achieve these goals? Are we on the right track?

Best Regards & Thanks again,


making a point

And this is not actually EmJay.

EmJay replies:

Hi Tom,

If you are getting a start on developing a lot of the good habits identified on this and other similar forums at the age of 25, you are off to a good start and well ahead of most of your peers. You’ll also be well ahead of my schedule.

I’d say the only thing that I did right in the early stages of my career is put money in company 401K’s. I didn’t really get serious and smart about our investments until I was approaching 30.

If I would have had an information source and community such as this in my mid-20’s, I can only imagine how much earlier we would have achieved Financial Independence. There were definitely mistakes made along the journey.

You pose an interesting question. The most complete way that I can think of answering it is by walking you through my financial journey and some of the milestones along the way.

The vast majority of my career has been spent working in Corporate America and it has been a pretty steady and stable upward trajectory in my salary. Here’s an overview of my income and savings trajectory (to the best of my memory) starting with my first job out of college:

– I generally started with zero savings coming out of college but also had zero debt. My wife started an IRA while in college and also finished school without any debt. Major kudos to both sets of parents for helping us to get started without a mountain of debt.

Year 1:

My starting salary in my first job was $22K. (FYI – Based on an online inflation calendar that would be roughly equivalent to $43K in today’s dollars). Assume 4-7% annual salary increases until the next big job change. Started putting money into 401K right away.

Year 5:

Changed jobs/industries and my new salary was in the low $50’s plus a bonus plan.

Years 7-8 

(30’ish years old): Living together and then marriage, becoming DINK’ers (Double Income No Kids). Between both salaries, surpassing $100K for the first time.

We were saving about 40-50% of our joint take home pay while also contributing to 401K’s up to at least the company matching amount.

This was the time period where I ramped up my knowledge on investing. We started with a financial advisor for a year or two. After further educating myself on investing and realizing how much we were paying in fees and commissions, we ended our relationship with the advisor and decided we could do better on our own.

We also bought our first home for $180K. Started investing in Vanguard mutual funds around this time.

Year 11: 

Have first child. After working a part-time schedule for a year or two, my wife decides to be a full-time Mom. Back to living on one salary. My stand alone salary is in the low $90’s. Also start investing in 529 Plan.

Year 13/14:

This is about the time that my salary cracks $100K for the first time; saving rate of 30-35%; also start maxing out 401K each year based on govt. limits.

Year 15 +/-: 

First time that portfolio cracks $1,000,000. This is probably the first time that I’m thinking, WOW, I might be able to take an early exit from the work rat race if we can keep this up.

Year 16/17: 

Decide to pursue an Entrepreneurial opportunity. Make approximately $25k and zero savings during this time period. The opportunity didn’t work out as planned but no regrets in trying.

Year 18: 

Sell first house for $490K (the house we purchased 10 years earlier for $180K). Buy new home in the $500’s. Re-enter Corporate America with a salary of $120K; we continue on the one salary. I see annual increases in salary of 5% on average leading up to the present day.

Years 20-23: 

The dark days of the market. Our portfolio is roughly cut in half during this time period. I stay the investing course, do not withdraw from the market and continue with auto-investing into Vanguard Funds and 529 Plan each month. (jlc–emphasis mine)

Year 25/Present Day: 

Salary in the $160K range. Continue maxing out 401K and investing approx 30% of take home pay; wife has picked up some part-time work the past few years which pays peanuts but she enjoys it. The equivalent of all her income goes into an IRA for investment and tax deduction purposes. Also re-financed the home mortgage a couple of times over the past seven years.

Additional Income:

Throughout the course of my career, bonuses and stock options probably contributed another $200K of after tax income. I believe it is important to disclose this for a complete picture of our journey and some things that made our present day situation possible. Aside from using some of this income for home remodeling projects, the majority went directly into Savings.

Mistakes made along the way:

    • Used a Financial adviser for a couple of years; paid high fees and commissions
    • Purchased a lot of individual stocks along the way and still own many of them. Some did pretty well. But, many did not.

Things we did right along the way:

I’m not sure if it was an article here on Jim’s website (jlc–Yep: The Simple Path to Wealth, one of my earliest.) or another but somewhere along the way, I read that rule #1 on the path to Financial Independence is (assuming one marries) to make sure you pick a spouse with similar financial views. My wife and I have always shared similar values and beliefs when it comes to finances and our journey has been a true team effort.


    • Since we’ve been married, we’ve been investing 30-50% of all take home pay per year.
    • We have stayed true to investing for the long haul and have not committed the common mistakes of buying high and selling low.
    • Discovered John Bogle, Vanguard, and Index funds fairly early in life.


    • We have lived well below our means, especially as it relates to big ticket items such as home and cars
    • We drive our non-fancy cars forever
    • Hardly ever go out for dinner
    • Do a lot of our own home improvement projects
    • Always pack a lunch for work
    • Keep house temperatures low during the winter and high during the Summers
    • Use the dryer as little as possible
    • Some other frugalities


Final Thoughts:

We don’t lead a Spartan life by any means. We have a nice home, drive two cars, pay for Cable TV, have a calling/data plan that is more expensive than it should be, have some expensive hobbies/interests, etc.

But, we also have some frugal spending habits and have saved at a fairly good rate. There is no question that we can and will reduce our spending habits. I applaud those folks that are able to save 50-75% of their earnings, keep their expenses way down and achieve Financial Independence even earlier in life.

We took a less extreme path along the way than some others but have still been able to achieve a level of Financial Freedom that a majority of Americans will never achieve. I guess my point is that there are different ways in getting there and now you have a better picture of our journey.

Addendum: Can Everybody Really Retire a Millionaire?  

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Important Resources

  • Talent Stacker is a resource that I learned about through my work with Jonathan and Brad at ChooseFI, and first heard about Salesforce as a career option in an episode where they featured Bradley Rice on the Podcast. In that episode, Bradley shared how he reached FI quickly thanks to his huge paychecks and discipline in keeping his expenses low. Jonathan teamed up with Bradley to build Talent Stacker, and they have helped more than 1,000 students from all walks of life complete the program and land jobs like clockwork, earning double or even triple their old salaries using a Salesforce certification to break into a no-code tech career.
  • Credit Cards are like chain saws. Incredibly useful. Incredibly dangerous. Resolve to pay in full each month and never carry a balance. Do that and they can be great tools. Here are some of the very best for travel hacking, cash back and small business rewards.
  • Empower is a free tool to manage and evaluate your investments. With great visuals you can track your net worth, asset allocation, and portfolio performance, including costs. At a glance you'll see what's working and what you might want to change. Here's my full review.
  • Betterment is my recommendation for hands-off investors who prefer a DIFM (Do It For Me) approach. It is also a great tool for reaching short-term savings goals. Here is my Betterment Review
  • NewRetirement offers cool tools to help guide you in answering the question: Do I have enough money to retire? And getting started is free. Sign up and you will be offered two paths into their retirement planner. I was also on their podcast and you can check that out here:Video version, Podcast version.
  • Tuft & Needle (T&N) helps me sleep at night. They are a very cool company with a great product. Here’s my review of what we are currently sleeping on: Our Walnut Frame and Mint Mattress.


  1. SavvyFinancialLatina says

    This is a great example of reaching financial independence little by little. I first learned about investing from my high school boss. I worked for a non-profit he had started after he retired from medical practice. He taught about index funds, how the market has ups and downs, but you must remain an investor at all time (dollar cost averaging). He retired at 55, is 79 today and is still retired and living it up. Even though he retired he is still working by running his non profit, but he chooses his schedule and what he does.

    • jlcollinsnh says

      Hi SFL…

      Sounds like a savvy guy. Also sounds like you’ve stayed in touch. Very nice.

      My guess is he appreciates that more than you’ll ever know. 😉

  2. Mitch H. says

    Thanks Jim and EmJay! As one of your younger readers I appreciate this type of content. After graduating college in 2009 I knew I needed to start investing. With a modest income and random expenses seeming to occur often I would get frustrated, but stayed the course. Now at age 25 and 27 my wife and I have just over $120 grand in investments. It amazes me we reached this point in a short time and when we have had so many expenses starting out (I.e house, etc). Our goal for 2014 is a 55% savings rate.

    I’ve mentioned to a few people I would like to reach 1 M by age 40 and everytime I get negative feedback. I’m either told it’s an impossible goal or I come across as boosting. It’s motivating to see other people pursuing FI and realizing the value of being FI, especially when being surrounded with so many of my friends and peers as high consumers.

    Best regards to all in pursuit of FI!!

    • jlcollinsnh says

      Well, those “few people” are quite simply wrong. 🙂

      With your fast start, progress so far and 55% savings rate, you’ll blow past a million like it was standing still.

    • EmJay says

      Good for you Mitch! You and your wife are well ahead of where I was at that age. Enjoy the financial freedom that is in your not too distant future.

    • Tom says


      Wow, well I would be lying if I said that when I read this I was questioning whether I made a post under a different name! I too graduated in 2009 and am at the about the same level of financial assets as you stated and couldn’t be more excited! However, I am not married yet, even though my girlfriend is 27 as well!
      The fact that you are your wife have already set that savings % goal for 2014 is fantastic! I too am already planning those types of goals for the year ahead. I think setting that percentage of income you intend to spend is extremely underrated in keeping an accurate budget and hitting (or exceeding) your savings goals.

      • Mitch H. says

        Good to hear Tom about your path. I sometimes try to talk to buddies about saving/ investing but have realized its best to leave it alone. I find that everyone is more excited about upgrading their cars, nights out, etc.
        Regarding savings rate, what’s worked the best is setting up automatic contributions from the bank account to investments on a monthly basis. Otherwise it gets tempting to spend. Best of luck!

        • Tom says

          Absolutely, have to agree with you there. I also use the different bank accounts for direct deposit to help the savings as well, it really makes it much easier.

          Question for you and anyone else, do you include what you put away in your 401K as part of your Savings %? I would think yes, (as I do) but what is the savings percentage based off of? Total Income before taxes / 401K Savings + Other Savings? Or do you calculate your savings after Tax(take home income)?


          • jlcollinsnh says

            Hi Tom….

            No hard and fast rules here.

            Personally, I always looked at 50% of my gross (before tax) earnings as my savings/investing target.

            401k, IRAs. Roths all included.

  3. mike says

    For some reason, Jim’s stock and vanguard articles are great, but I really enjoy reading financial success stories.

    Like the first 2 comments before me, I’m interested in MsLatina’s financial education and also I’m so impressed when young people (like the 2nd commenter) get it at such an early age.

    • jlcollinsnh says


      I think it’s the difference between theory and practice. Stories are always more fun and interesting.

      There are more coming!

  4. J.R. says

    Probably one of the best lines of the post was “We took a less extreme path along the way than some others but have still been able to achieve a level of Financial Freedom”. I think a lot of personal finance blogs that focus on financial independence/freedom say there is only one way to reach it – cut your expenses and invest everything. We look at EmJay’s life and see that he has a nice home, drives two cars, cable TV, but incorporated frugal spending habits and saved a decent amount in order to reach financial freedom. I like this, I like it a lot. It goes to show there is no single path to financial freedom, but many ways to reach it.

    • jlcollinsnh says

      Well said JR…

      …and I liked that line too!

      Reaching FI is not about denying yourself. It is about choosing those things you can afford and that bring the most value into your life. Choosing investing is a very important thing. But it doesn’t have to be the only thing.

  5. Shilpan says

    I wish that every young person reads your blog as this article alone sums up formula for FI.

    — Find a partner who believes in your financial values
    — Save like today is your last day to save
    — Don’t spread your legs beyond the blanket(AKA live within your means)

    I really enjoyed this article.

  6. Cindy says

    I love stories like this! It gives me hope that I can get there. Granted, I’m starting much later (35), and still have some obstacles (debt) to overcome before I can really start making progress. I kick myself for not getting it together sooner. But then I remember, better late than never!

    • jlcollinsnh says

      Welcome Cindy…

      Glad you liked it! They are fun for me, too.

      At 35 you have plenty of time to make this happen. Check out my November 17, 2013 conversation with John in the comments here:

      At age 40 John found himself flat broke. 16 years later he has around 2.6 million. Even faster than EmJay.

      Keep us posted on your progress!

  7. Pura Vida Nick says


    I’m really interested in how you reduce dryer use? This may seem like a small thing but I notice that my wife and I use the dryer a lot. You mention not using it much, and I read on another site (mr money mustache) that he rarely uses his dryer. I think our dryer uses a lot of electricity, not to mention a big wear and tear on our clothes. Did you simply hang your clothes up? If so, don’t they come out really wrinkly? I need to get efficient at ironing if that’s the case – it takes me 30 min to iron a shirt and still looks terrible!

    • EmJay says

      PVN, yes, we hang the clothes outside on a washline during the warmer months and on drying racks and clothes hangers inside during the colder months. Yes, the clothes probably do come out a bit more wrinkly than when coming out of a dryer. However, my wrinkle free shirts don’t require ironing and look fine.

    • 2l2r says

      This made my smile, we live in a fairly upscale neighbourhood and we are the only house that hangs clothes out to dry. Where I come from ( Europe as the Americans like to call it ) everyone does it. In winter clothes go on an indoor rack.
      I think it is just a very small part of a larger mindset that resulted in reaching FI earlier than most ( however my story if far from conventional and sometimes I have to stop and think how did we ever get here) and comes back to what others mention here often.

      1/ Like minded partner
      2/ Avoid the lifestyle inflation

  8. lester says

    Great article,
    I am in a similar position, 49-yrs old. Around $3 mill CDN in assets if you include non income assets like my house (give or take $500 ‘ishK). We are currently transitioning in semi retirement and a big fan of your blog and a few others such as moneymoustache, conservative income investor etc. My wife and I also did it the old fashion way (with our 2 kids). Lived below our means, had similar goals, cycled to and from work, walked the kids to school, only one modest (minivan) car, brown bagged it for lunch and good old fashioned hard work with delayed gratification.

    The only thing I would add for anyone starting out is the first $100K invested is the hardest, then it starts to snowball. Once it gets to $100K, DON’T SPEND THE CAPITAL

    • jlcollinsnh says

      Welcome Lester…

      And congratulations. Very well played and a great example of how getting the basics right leads to great results.

      I especially like your point about the snowball effect. Some, I think, get discouraged early when the amounts are small and even a 10% gain isn’t much money. But, as you say, up around 100k, suddenly 10% is $10,000. At a million it’s $100,000. One day you wake up and your investments are producing more than you are spending. And that is a beautiful day. 😉

  9. Mrs EconoWiser says

    I love looooooooooove LOVE your case studies!!! So inspiring! It gives us so much hope and confidence about the fact that we are very much on the right track.
    We’re almost ready to dump a lot of cash into the stock market…almost…guess we’ll read the stock market series ten times over and then take the jump! 😉

  10. Tom says


    Thanks for the excellent response to my question. Apologies for the delay, after posting that question I had not seen your response until I logged in last night and saw that Jim had turned our conversation into its own case study!

    The breakdown by amount of years was an excellent way to describe how your path changed and hit bumps along the way, its funny to think that my entire “path” so far is summed up in your group of years 1 & 5!

    Some of the most important items that resonated with me are the items that anyone reading this blog can make changes on TODAY:
    “-We drive our non-fancy cars forever
    -Always pack a lunch for work”

    These are my favorite items, and I think the above can make a drastic difference to savings over the long run. Considering I sit next to a few people that buy lunch everyday, and easily (in NYC) spend anywhere between $8-15+ for lunch on a daily basis, I already see the benefits.

    I also recently sold my new car (2010 model) in February, because I just didn’t need it anymore. I sure have saved alot in insurance (and overall hassle) since!

    Also, driving a standard non-luxury vehicle around has other benefits besides the price you paid for it and the repair costs — I’m sure you have saved a ton in insurance costs.

    I believe making that initial change is something I really struggled with in the beginning. Everyday I would say, I’ll bring my lunch tomorrow, or I’ll get to selling my vehicle this weekend. This took some time, especially the car, but there is no greater satisfaction then looking back on expenses you used to pay, and now having that money to invest/spend on more important items.

    And Jim, thanks again for sharing my question & EmJay’s response with the rest of the blog via a case study!

  11. cv says

    I am a few month shy of completing year one of frugal saving/living; in some aspects of life, things got easier; as time goes on, some temptations also becomes harder to fight with; so I really appreciate Jim posting these stories and consistent words of wisdom on a regular basis. I’ve said it before, newbies like me need lots of encouragement; still waiting patiently for Jim’s book.

  12. Jeff says

    EmJay, thanks for being willing to open up your financial life. Your story provides a lot of lessons as well as inspiration – perhaps the most important being that your level of success is readily available to regular people willing to make the adjustments and stick with the plan. I enjoyed the case study analysis, but it was very insightful to read the story of how you got there. Congratulations and best wishes with the next phase of life.
    Jim I really enjoy your blog and especially the stock series and the case studies. Wonderful combination of education and inspiration. Keep up the good work!

  13. PFgal says

    I really like this, especially the way it was laid out year by year. Jim, I’d love to see more case studies of people with more modest incomes. While stories like this are great, they can be hard to relate to for those of us who will never come close to 6-figure incomes. I’m not complaining – I made certain choices about my career and I have no regrets. I’m just saying that while I can do the math and see that it’s possible to reach FI on a lower salary, it’s really inspiring to read stories by people who’ve actually done it.

    • jlcollinsnh says

      Thanks PFgal…

      Glad you like them and I hear you on getting some income variety into the mix. Agreed!

      I have two more in the queue at the moment. One is very much like these others and so I’ll put that one to the back of the line for now.

      The other is at the opposite end: What it looks like when everything financial goes wrong. That’s going to be a very interesting one!

      Since I draw these from readers who ask questions on
      my options are limited until one comes along. But I’ll be on the lookout!

      Until then, if you haven’t already, check out the links in this post:

      • PFgal says

        Oh good, I look forward to reading that one! Like I said, the theory is good, but it’s fun to see people who’ve actually made it work. Hopefully you’ll get more good case study questions as you do more of these – they seem to be very popular!

  14. Tyler says

    My wife and I started our lives together at 20 and 19 respectively and while this has been a larger roller coaster than I was expecting in retrospect it’s definitely been the best year and a half of my life. Mainly because we get to literally grow-up together instead of just getting together. My wife came from a very different lifestyle compared to what I grew up with and there was a couple of headbuts when I decided that “we” wanted to retire around 30, but i eventually told her my goal was to spend all my time with my children that they wanted and needed and after seeing how strongly I maintain that sentiment(and after showing her the math) she finally acquiesced for which I’m very greatful. Now for the numbers. From Oct. 2014 to April 2015, without really trying, my wife and I managed to cobble together $8,000 off of my income alone in savings and I had to figure out what to do with it. From April of 2015 to December we managed get $22,000 with most of it invested in Vanguard. For the record, my wife doesn’t work yet and so far since 2016 kicked off we’ve managed to hit around a 40% savings rate. I honestly can’t wait for my wife to start working so we can join the greats of early retirement ourselves in 9 years. Thanks so much for writing and thanks to anyone that read this all the way through.

  15. Miki says

    I’m currently a recent college grad (age 21) and I am very interested in retiring early. I read your book and noticed you said to max out a traditional IRA instead of a Roth bc of the compounded benefits of investing pre-tax income. If my income is over the income limit so that I can’t get the deduction for a traditional IRA, should I still max out the regular IRA or the Roth? and would the order still be 1) contribute to 401k to get the match 2) max Roth/traditional IRA (depending on your answer) then 3) max 401k 4) then taxable account? Thanks so much!

    • jlcollinsnh says

      Hi Miki…

      First, a traditional IRA and a regular IRA are the same thing. You might be thinking of a non-deductible IRA.

      Second, there are also income limits on a Roth, so check those.

      That said, I think I’d fund the:

      –401K to the max for the max tax benifit
      –taxable account

  16. James Giles says

    Hi, James Giles from the UK here.
    I am 45 and completely new to all this, so it’s quite a revelation. I just hope I’m not too late

    Would it be a good idea for someone from the UK to invest in US index funds, or would costs incurred (e.g. currency exchange) be too detrimental on the return?
    Should I invest in a UK index fund instead.

  17. DebtJoe says

    They definitely did a lot of things correctly but also had some advantages. No student debt and their house doubled in value. Those are significant and definitely make things much easier.

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