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April 2021

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How to retire richer the lazy way

Shopify Stock Chart
Ok I didn’t get that job at Shopify so no juicy stock options!

There are lots of ways to retire richer. You could start selling products in a multilevel marketing scheme (downside: annoyed friends and a garage full of creme rinse, vitamins and car polish). Perhaps you could just pick a new employer with a great stock option plan ( I came in second for a job at Shopify once. Bummer – see stock chart below). Or you could move back home with your parents (Father: “Honey, what’s that smell upstairs?” Mother: “I think it’s our 30 year old.”)

Not thrilled with any of those options? In a perfect world, you could just plant yourself in a chair, do some scrolling and mouse clicking and have a few hundred grand gradually added to your retirement fund. Sound a little too good to be true? In fact, not only is it possible, I just did it and you can too! No tricks, no clickbait, stay with me on this and I’ll show you how to retire richer.

Get rich without working or giving anything up? Ummmm…OK!

Last post I did some energy saving projects and laid out how we will save about $1,300 a year on gas and electricity right here at Cashflow Cookbook headquarters.  Which is not bad, but those ideas take some work. Insulating and weatherstripping and whatnot. What if we could save more than twice that without lifting a screwdriver?

Turns out, the answer was right there, hiding in our car insurance policy. Who knew?

Comparing car insurance is easy…and lucrative

It was hard to watch this year’s Super Bowl without seeing those Zebra car insurance ads. (Being a Browns fan it was hard to watch the Super Bowl anyway. Soooooo close, we coulda been there! Next year!) Seemed like they popped up after every Buccaneer touchdown. Could comparing car insurance really be as easy as it looks on TV? Turns out it kind of is!

Way back in the 2010’s, comparing car insurance rates was a painful process of making calls or reentering your car and driver data on multiple sites. Now it’s much easier with comparison sites. We looked at 2 comparison sites here in the USA, Zebra and Insurify. Both had a snappy interface and let you quickly add cars and drivers to suit. Even with 3 cars and 3 drivers it only took 15 minutes per site. Their results were similar, although Insurify had more options and two quotes that were much lower than what Zebra offered in their “displayed quotes”. In Canada check out ratehub.ca and rates.ca.

I used our actual data for 3 drivers and 3 vehicles. Our current insurance is with GEICO and we pay $141.60 a month. Having that policy handy sped up the process of entering all of the information. Using the same policy parameters, Here are the results from Zebra:

Zebra quotes
Zebra car insurance rate comparison

Zebra quotes

The Zebra options were limited with just 3 companies showing actual quotes. The rest promised “one more click to quote”. Well that’s what they promised. The “get quote” companies dragged me through traffic ticket data, annual miles driven and even that accident where I hit a deer a couple of years back. I was hoping to forget that. Some of the companies require you to pretty much re-enter all of your data (Talking ’bout you, Progressive!). The good news is that after all the work, Progressive did deliver on their promise of being cheaper than GEICO. In fact, they were the cheapest overall at just $502 for 6 months, or $83.66/month.

The cheapest “displayed quote” on Zebra was $164 which was more than the $141 we are paying with GEICO. Not exactly a win. On Zebra the gold was in the undisplayed quotes. Still, who wants to do the extra work? On to Insurify to see how their engine works:

Insurify quotes
Insurify car insurance rate comparisons

Insurify shows us how to retire richer!

Over at Insurify we had lots more options. Have a look at all this goodness!

Huge swing in prices from a high of $331 to a low of $97. A difference of $234 a month. Worth a few mindful moments with your browser. One of the interesting options is Clearcover – a digital provider with a slick app. (They don’t even want to know from paper).  They claim that they can settle your, well, claim in as little as 13 minutes. Hello disruption! And with 489 Google reviews averaging 4.5 stars, apparently they are doing something right!

Although Insurify had the edge in my situation for the displayed quotes, it might be worth the extra 15 minutes to run your scenario through both of them. And check the “get quote” options just to be sure.

The remarkable thing is that the prices varied by almost 4x going from lowest to highest. That is even more than the 2.5x difference when we were trying to find out if premium vodka is worth it. So this is a pretty easy and painless way to save some monthly cash.

 

OK but how to retire richer and where is my $650,008?

If we take the $248 monthly savings between the low rate (Progressive) and the high rate (Safeco) seen on the two sites and invest it at 7% you would have:

  • $42,904 after 10 years – good news for you 55 year olds
  • $128,960 after 20 years – even better news for you 45 year olds
  • $304,048 after 30 years – you 35 year olds have got to be loving this
  • $650,008 after 40 years – if you are 25 shop your insurance NOW!!!

Given that the average American retires with just $200,000 of total net worth, here is a way to triple that with just 15 minutes of work. If you’re wondering how to invest those savings and earn 7%, you can learn about that here. People often ask how to get started with building wealth. Answer…This! Good luck and let me know how this worked for you.

Is there a rate comparison engine that you like better? Let me know in the comments below.

Photo credit Marcel Friedrich at Unsplash

Earth day – time to fight some home energy thieves

Welcome to Earth Day. It’s our worst one so far! The earth is heating up, oceans are rising and forests are ablaze. What a great blog post opening! Who’s still with me? It’s hard for us to totally solve these issues as individuals, but we can all do something. Let’s start by slaying some of those home energy thieves. Saving energy helps green the planet, and adds some green to our wallets. And while energy savings may not be the most exciting topic, some quick projects can improve your financial wellness without giving up anything important. Like a nice glass of Merlot, tickets to a Browns game or a new set of clubs. And now is the perfect time to tackle some of these projects while we are all locked down.

We saved 44% on electricity and 12% on gas bills. How ’bout you?

Well it’s great to talk about home energy thieves, but what about actually doing battle with them? What really works and is it worth the effort? We dug in right here at Cashflow Cookbook global headquarters. With a bit of sleuthing, and a few dollars in parts, we managed to save 44% on our electricity bill and 12% on our gas bill. How did we calculate that and what made the difference?

For the gas bill, we compared the heating season gas consumption in 2019-2020 to our consumption this past winter. Log in to your utility company account to check out your own info. After correcting for temperature differences (degree days for the technical among you) our consumption dropped by 12%. How did we get these savings?

Air sealing is usually the best return on energy projects

My basement workroom was freezing cold. After a bit of poking around, it turns out that there was a 3/4″ gap under the door that goes to the unheated garage. A bit of math tells me that is a 22.5 square inch gap or about the same as a 5″ hole in the wall. If you noticed a 5″ hole in the wall of your living room, might you fix it? Hell yah!

stop home energy thieves
energy saving door threshold from M-D building products

I bought a heavy duty threshold and weatherstripping for about $30 and installed it. No breeze under the door and the workroom is nice and toasty. Love that! I checked the other 2 doors that lead to the garage and they were leaking air as well. About another 5 square inches in total. One needed a door sweep  and the others had gaps around their door stops. I removed and re-nailed the door stops and muffled that breeze as well.

Up on the second floor, in our Harry Potter closet, our electrician had installed a secondary panel. The cables from the panel head up to the attic, but the hole left a 1″ x 14″ arctic breezeway. I filled it with foam and will build a wooden cover to finish it off.

All told, those changes totaled about 42 square inches of air gap. Whoa that sounds a bit nerdy!  Maybe a lot nerdy. For the less geeked among us, that is about the same as a 7″ hole in the wall. As a result of these changes our gas bill dropped 12% which saves us $150/year. Not a bad start, and a warmer, more comfortable home.

What is next for gas savings?

Here are the projects coming up for 2021:

  • More air sealing – We still have lots of drafty windows and doors to go. So we will check and replace weatherstripping and ensure that doors and windows aren’t leaking air. Should be able to save another $50/year
  • A programmable thermostat – great way to to save about 10% or $120 for us for a one-time investment of about the same. As a side benefit, a cooler room leads to better sleeping in the winter and a greener planet.
  • Attic insulation – our 1938 home could use an additional layer of attic insulation. Insulating existing walls can be expensive but most attics can be easily accessed. A few hundred dollars in insulation should save us another $250 a year.

So by next year, we should have saved about $570 a year on our gas bill. Not a huge deal, but once these projects are done, they keep rolling in the savings year after year.

On to some surprises in our electricity bill

We caught the home energy thieves red handed in our electricity bill. Those nasty boys! With a few simple changes, we dropped our bill by 44% vs the same period a year ago. On an annual basis, that will save us about $700 a year. How did we do that?

  • Turns out that our roof heaters (melt the snow around the gutters) were wired to a circuit that was permanently on. We installed a simple switch and turn them on only during heavy snowfall, saving about $25/month year round.
  • We swapped out our old fridge for a new one saving about $10/month. Bonus: the new one is wider and shallower – my spinach can’t hide behind the chocolate cake anymore.
  • Our lightbulbs were mostly incandescent so we swapped them for LEDs throughout the house. Great light, less bulb changing and and more greening of the planet. And savings of about $25/month.

What is next for electricity savings?

  • During our kitchen renovations, we will replace our ancient dishwasher with a new, more efficient one. The newer models use about 1/3 the water and will save about $5 a month vs the old one. And they have that nifty silverware rack.
  • All of the gas savings ideas about will also carry an electrical savings benefit as our furnace pump will run less in the winter and our air conditioner will run less in the summer, easily saving another $5/month.

So all told on electricity, with current and future projects, we expect to save about $800 a year.

Overall summary of our work on battling our home energy thieves.

Looking at both utility bills we expect to save about $1,400 a year. Once the projects are done, we will be able to realize those savings each year and the actual value will rise with the utility rates.

What to do with the $1,400 in annual savings?

$1,400 isn’t a massive game changer. Maybe head out for 4 or 5 nice dinners out? See what’s on sale at the mall? But here are some better ideas:

  • A $116 extra mortgage payment on a $300,000, 30 year mortgage at current rates will save $25,000 and 3 years and 7 months of payments. Nice!
  • Investing the $116 monthly at 7% would grow to $20,000 over 10 years or
  • $60,400 over 20 years or
  • $141,000 over 30 years or
  • $304,000 over 40 years. Boom! There’s your Lamborghini right there.

Other ideas to stop home energy thieves whilst greening the planet

  • Start by adding up your energy bills and compare them to national averages. As a quick guide, electricity bills average $110 a month, gas $72 a month. These vary a lot by climate and rates. If yours are way out of line, do some investigating.
  • Consider a 3rd party energy audit. There may be offers on these from your local utility.
  • Change your furnace filters regularly and clean the lint trap in your dryer.
  • Turn down your thermostat a couple degrees in the winter and up a couple in the summer. Adjust for the difference with your clothing.
  • Turn off lights as you leave a room. Teenagers do this naturally. Kidding.
  • Close the doors! Leaving them open while heating or air conditioning is a huge energy waster. There is an exception to this. In my part of the country there is something called a Midwestern Goodbye. A 20 minute farewell in the house followed by a 20 minute lovely-to-see-you-again at the doorway, then a 20 minute let’s-do-this-again-soon at your guest’s vehicle in the driveway with their engine running. Very warm and caring – not great on energy use – but a wonderful custom!
  • Check for phantom power loss – electronics use power even when off. Smart power strips can provide savings

Check in next week when we look at an opportunity for much bigger savings in a whole different category with much less work!

What are you doing to save energy and how are you investing the cash? Let me know in the comments below.

Photo credit Allesandro Bianchi at Unsplash

Stay sane during Covid

It began with a shock as the virus spread, everything closed and markets crashed. Then things got eerily quiet. For a while doom scrolling kept us busy. Then the scramble to set up a home office and learning spaces for the kids. Next came guzzling down Netflix episodes for light drama followed by a US election for even more drama. Most recently we’ve been comparing shots and reactions. But we are all getting weary and it’s time to find new ways to stay sane during Covid.

Fine, I mean fun, dining

No question our eating has changed a lot. Emphasis on the lot.  Where workday dining used to be confined to mealtimes, being at home gives us continuous access to the fridge, the pantry and the cookie jar to relieve some boredom. Here are some ideas to mix things up and stay sane during Covid:

Meal Kits – here in Ohio, our Giant Eagle grocery store has a selection of Great to Go meal kits for two including Chicken Piccata and Mushroom and Green Chile Enchiladas. Meanwhile in Canada, PC Chef has their Oaxacan Pork Tacos with Mango Salsa and smashed Avocados. They make a fun date night, are easy to prepare and build real chef skills for when you are ready to take off the culinary training wheels.

Leftovers – check out Supercook, a clever way to find recipes with what you have left in your fridge. Download their app from the App Store or Google Play and just speak your fridge leftovers into your phone. Boom! It finds you recipes that use just what you have! How Cashflow Cookbook is that?

Wine Clubs – there are some great wine clubs out there including the Wall Street Journal Wine, a cool club that starts off with 14 bottles plus glasses for just $69.99. Or why not try a complete blind tasting kit from Argaux? They offer 2, 3 and 4 bottle kits to test your palette and learn your preferences. You can set up your own testing night and compare scotches, gins or rums. We did a comprehensive vodka testing night right here at Cashflow Cookbook headquarters.

Clear out the brain fog

What a great time to learn something new! We are all used to remote connections and the range and quality of courses has never been better. Wonderful way to reinvest your commute time in ideas to enrich your life and further your career while staying sane during Covid.

Stay sane during Covid take a class
a masterclass can teach you all kinds of new skills. Photo Andrew Pons

Masterclass gives you full access to the best in every field. Learn songwriting with Alicia Keys, cooking with Gordon Ramsey, skateboarding with Tony Hawk or business management with Howard Shultz (think Starbucks). An unbelievable deal at $15/month.

There are lots of other great online learning sites including Udemy, Coursera, EdX and LinkedIn Learning. Titles include business related topics like mastering XL (how fun is that?) or learning to code (How much fun can you take?), to every kind of interest or hobby. Udemy, as an example, includes courses on everything from music and photography to fitness, lifestyle and interior design. Often courses with thousands of 4-5 star reviews are only $20-$40. Coursera and EdX tend to more academic and career-oriented titles.

The great outdoors

There it is, just past your screens and out your front door! Go check it out. Prop up an effigy of yourself in your office chair so you’re not missed on the Zoom call. You got this.

Hike – grab some runners and get to a park or trail. Breathe that fresh air and commune with the woodland creatures. It’s a lot like the Headspace meditation app, but without the computer, the guy with the British accent and the annual subscription. Push the pace a bit and get your heart engaged, or bring some snacks and loaf along. Either way, the latest research says that it will help you stay sane during Covid.

get out for a bike
It’s like riding a, well, you know! Photo Carl Winterbourne

Bike – yah, the dusty metal thing in the garage, just behind the Christmas decorations and the boxes of, well, whatever is in them. Guessing here, but perhaps you haven’t had it out in ages. The good news is that it is just like riding a…well you know. Get a nifty phone holder for your handlebars to help your navigation or just go natural and enjoy the day.

Herb and Vegetable Gardens – A great alternative if all of that huffing and puffing isn’t your thing. Lots of instructions to get you started on YouTube and seeds and kits on Amazon. A wonderful way to commune with your own yard, and get the very freshest ingredients for your garden.

Bird watching – I know, I know, it sounds a bit fuddy duddy. Bust out the Tilley hat and the cardigan and all that. But a bird feeder set up just outside your morning coffee window really adds something. And since your boss isn’t watching, take your time, enjoy the interactions and the colorful species. Hauling the bird food around provides a great workout, which leads us to the next section.

Home workouts

stay sane during covid with home workouts
stay sane during covid with home workouts. Photo Johnathan Borba

Sadly, all of the excuses are gone! The gyms may be closed, but you can set up a home gym. Peloton, Bowflex and NordicTrack are all shipping again. And even if they weren’t your body weight is still there. Maybe more than ever. Get some basic equipment and then amp it up with bespoke virtual classes.

YouTube has every kind of workout and tons of instruction in Yoga, pilates, bodyweight, and Martial Arts. If the Apple elves brought you a watch for Christmas, put it to work with the Apple Fitness+ app. Love this, new classes all the time to bring your treadmill, spin bike, yoga mat and abs to life.

Honeydew list

Since you are at home staring ceaselessly anyway, why not fix a few things up? Tradesmen are booked solid, but what a great time to learn some new skills. Recruit a handy relative or try working under the wing of a pro. There are YouTube channels for every kind of fixit project. Bob Vila and Vancouver Carpenter are awesome for general repairs, while Appliance Repair is great for fixing, well, you know.

If your boredom sinks to previously unexplored levels, it might be time to do the sorting and organizing that you have put off for the last decade or two. Do some robust purging, move those old treasures out to charity and then get some shelves going to give you primo access to the things you really need. Cleaning, sorting, purging and organizing rivals meditation and Xanax for mood improvement.

Looking to ease your boredom, stay sane during Covid and save money? Tackle some energy saving projects, like weatherstripping some leaky doors and windows, sealing around pipes entering your home and adding attic insulation. We did a few Covid-era projects to save on electricity and it made a big difference. See below:

stay sane during covid home energy projects
Looks like those January energy savings projects paid off

Build a kit

stay sane during Covid - build a kit
stay sane during Covid – build a kit

You name it, you can get a kit for it. Deb got me a Les Paul guitar kit that will have me sanding, staining and soldering for weeks. Once done, I will plug it into one of the amp kits I built earlier for a real all-built-at-home experience. To ensure that I can enjoy really great guitar tone, we just got tickets for a Santana concert later this summer.

If you trend to more arts and crafts, here is a cool hands casting kit to immortalize your paws. Or you can find books and kits to make everything from candles to clocks.

Entertainment in a box

A bunch of companies will ship you a monthly box, of well, cool stuff. Hot sauces, mystery games, puzzles, at-home escape rooms, luxury essentials and tons more. Check out Cratejoy as an example. Prices run from $20-$40 a month or so.

Summary

Turns out that there are lots of ways to stay sane during Covid. As scary and as sad as this chapter has been, its also been a time to regroup, reconnect and recharge. Maybe a change to remake your life in a new way. For many it has opened possibilities – more working from home, less commuting, more free time for family. Some of these changes can help free up cash (one less car? reduced commuting costs?), while others can offer a better lifestyle (more time with kids, spouse and pets). Use the time as a chance to improve every aspect of your life. Soon the fog will lift, the world will open up and we will appreciate relative visits, dinners out and concerts like never before.

How are you staying sane during Covid? Let me know in the comments below.

Main Photo by Priscilla Du Preez on Unsplash

Build wealth like the pros!

If you’re on a slower path to wealth than you would like, this is the post for you. No wealth whatsoever? Even better. Let’s get you started. There are the special hacks that will help a lot: marrying into money, inheriting a bundle, lottery winnings or working somewhere with a juicy stock option plan. If none of those are in the cards, not to worry. Turns out, there are just 4 factors to tweak to build wealth like the pros. Which one is the biggest issue for you? Read on and let’s find out!

Factor 1 – Rate of return

As you save money and invest those funds will grow. How much? That depends on the rate of return. If you want to build wealth like the pros, that is the first place to look. For a quick perspective, the Rule of 72 is a handy way to understand the impact. If you divide your percentage return into 72, the result is the number of years it will take to double your money. As an example, at 7% return, it would take about 10 years to double your money. At 2%, it would take 36 years. Ouch! That’s a big difference. No Lamborghini for you. And if inflation was running at 2%, you would be getting exactly…nowhere. Now you know why having all of your money invested in savings accounts, treasury bills and GICs won’t work.

Compare to the Indexes

How are you doing on your rate of return? Go back and take a look. For business, the rate of return should be quite clear from the business statements. For savings with an investment firm, your rate of return should be available on your statements or online. In the case of equity investments (stocks) the question is whether, after all fees, they exceeded the overall stock index. For the US market the index is usually viewed as the S&P 500. It has averaged about 8% over time. If your investments are trailing that, it’s time for a review with your investment advisor. Investing on your own, maybe it’s time to invest in the overall index. By definition, if you are investing in the index, you can’t be underperforming it. Also, maybe act on fewer “hot” stock tips from your Uber driver.

It’s important to compare like for like investments to the indexes. That is to say, compare your US stock portfolio to the US stock index. Likewise with bonds, European stocks etc. Here are the common indexes to use as benchmarks:

  • US Stocks – S&P index
  • European Stocks – STOXX Europe 600
  • Canadian Stocks – S&P TSX index
  • Global Bonds – Merrill Lynch Global Bond Index

These are just examples of some indexes for comparison. Find one that works and compare your investment returns.

Factor 2 – time

Assuming you are getting a great rate of return, the next big factor is time. Compound interest is the 8th wonder of the world, but time is the magic that really sets it ablaze. To illustrate, let’s go back to the Rule of 72. As we said earlier, at 7%, money doubles every 10 years or so. Cool. But it doesn’t stop there. It keeps doubling every 10 years. Let’s say that you had $100,000 invested at 7%. After 10 years it would double to $200,000. So 10 years later it would be $400,000, then $600,000 and $800,000 after a total of 40 years. Wow! that is a pile of money. OK, now let’s see who was napping during that math! It actually doubles every 10 years. So the real math is $200,000, then $400,000, then $800,000. After 40 years, it hits an astonishing $1,600.000!

Enjoy now or save for later?

Well that is a big pile of money, but who wants to wait 40 years to get rich? Great question. There are three parts to this. First, if you are 20 right now, 40 years from now you will be 60. Which isn’t all that old. Trust me, I’m almost there. I can still run, ski, play the guitar, and bike. And the mortality tables tell me that I still have another 30 years or so to go. So I’m glad that I followed my own advice and earned a good return and let that money grow over time. Second, you aren’t waiting for all of your money to grow like that, just the part that you are saving. The rest you can spend and enjoy through all of those years. Third, let’s go back to that $1,600,000. That means that every dollar you set aside and invest at 7% becomes $16 in 40 years. That is a big difference vs spending that $1 now.

But how much should you save and how much should you spend? That leads us to our next factor in how to build wealth like the pros.

Factor 3 – Savings Rate

Savings rate is just the percentage of your gross income (before deductions for taxes and other things) that you set aside to build wealth. So if you earned, say $100,000 and saved $10,000, your savings rate is 10%. If you saved $15,000 on that same income, your savings rate would be 15%. But how much difference does the savings rate really make? Is it really worth it to increase your savings rate from 10% to, say, 15% or 20%? Let’s take a look:

Build wealth like the pros
Build wealth like the pros

In the graph above, we see the difference that savings rate makes. To provide context, the graph is based on a household income of $150,000 with the savings earning 7% annually. Saving 5% of that would be $7,500 a year, or $625 a month. At a 5% savings rate, after 30 years, we would accumulate $762,000. Not bad! But saving 10%, we would accumulate $1,526,000. Quite the difference. After 40 years, the 5% saver would have $1,640,000 while the 10% saver would have $3,281,000. Of course, someone who enjoyed all of their income and saved nothing would have, well, nothing. Not a great retirement. Or maybe working longer than you had hoped. So savings rate is a key to build wealth like the pros.

And there are other ways to look at this chart. As an example, let’s say you wanted to retire early. At a 5% savings rate, you would accumulate $1,126,000 after 35 years. But with a 10% savings rate, you could gather the same amount after just 27 years. That’s 8 years to whack white balls across the countryside, build a school in Kenya, or just bask in a hammock sampling Pina Coladas.

What counts in savings rate?

Another good question. It’s anything that builds wealth. For instance, contributing to a registered education plan is a great thing to do, since the government helps you save more effectively. But it doesn’t contribute to your long term wealth. Joining the company pension plan does count. If you want a 10% savings rate and your pension plan contribution is 6% of your gross, then you would need to save another 4% elsewhere. If you had a high interest mortgage or other debt, applying accelerated payments would count since the “return” is guaranteed and eliminating that debt would help build your long term wealth. Just make sure that you aren’t living beyond your means, continuously racking up debt, then paying it off. That doesn’t count! Nice try though!

What if you can’t scrape together a decent savings rate?

There are tons of ways to save on just about every category of spend. I spent 2 years finding the best ideas, in fact, $13,000 of monthly savings ideas. Check it out here. And be sure to subscribe to this blog so you don’t miss anything. No spam, no passing your information to foreign hackers. Just you and me building your wealth!

One more trick to build wealth like the pros

Saving any amount might seem daunting. But 4% is better than 2% and 2% is better than nothing. Build the savings habit, establish some sort of automatic savings plan that snatches the money before you can. A company stock purchase plan, an automatic monthly  transfer to an investment account or a government registered plan. Start with a small percentage and step it up a bit at a time. If you do it just as you get a raise, you literally won’t notice the difference. Maybe enjoy half the raise and use the rest to crank your savings rate up an extra 2 or 3%. Then do it again next raise. It’s worth it.

And there is one more way to build wealth like the pros:

Factor 4 – Income

On the one hand, this is a bit obvious. Doesn’t everyone who earns a lot end up rich? Well, actually not. Ask Mike Tyson, MC Hammer, Nicolas Cage, Toni Braxton, 50 Cent, Kim Basinger, Michael Jackson or Burt Reynolds. If you spend as much as you earn, or more, you will go broke no matter how much you earn.

But what happens if we keep everything else the same, but increase our household income from, say, $150,000 to $200,000? Let’s take a look at the chart with the new numbers:

build wealth like the pros
More income helps too!

No surprise. All of the numbers get bigger. As an example, a 20% saver earning $150,000 would accumulate $3,049,000 over 30 years, while the 20% saver earning $200,000 would pile up $4,066,000. Whoa! An extra millski. And it shows that increasing your earnings is another key to build wealth like the pros.

What did I miss? What aha’s did you have? Let me know in the comments. If you enjoyed this, please share it with the social buttons.