Friday Finance – money milestones

I’ve noticed that those who are good with money when they are young rarely have money problems when they’re older. Careful management of their assets will enable them to reach escape velocity so long as they get a good decade of growth somewhere along the way.

Those who piss money up the wall when they’re young often continue to do so throughout their lives, though some reform and sort themselves out.

Happily, the number of reformed prodigal sons is much greater than the number of prudent young people who become profligate oldies.

Having said this, how much money should you aim to have at different ages? What amount means that, all things being equal, you’ve pretty much made it?

The figures that follow are not strict requirements and they are well above the median. However, if you do manage to reach these figures, your odds of ever suffering severe money problems is very slight. This is partly because you clearly have the right attitude towards saving and partly because compounding interest will do a lot of the work for you from now on, given enough time.

All amounts are in today’s USD.

Age 30: $100,000

Few thirty-year-olds will make it to this milestone. Those that do (or get close) will have plenty to cope with emergencies. With modest monthly inputs from this point on, retirement will not be a problem.

Sans a drug addiction or horrific injury, you’re going to make it.

Those that steadily earn and saved this amount will be fine because they clearly know what they’re doing. The only thirty-year-olds with $100K who might be in serious danger of losing it are those that came into a chance windfall.

If that’s you, be careful. Learn about money or prepare to kiss it farewell.

Age 40: $500,000

If you were on $100K by 30, reaching $500K by 40 or so should not be too difficult so long as you keep doing what you’re doing.

At this level of wealth, you basically have enough to survive independently so long as you can live a frugal life, perhaps overseas.

Age 50: $1,000,000

Starting from those earlier amounts, getting to $1M should be a straightforward matter of not blowing it.

The proportional gap between ages 30-40 (x5) and 40-50 (x2) is because the younger fellow will need to keep working and saving to add to his investments, where as after the half-mil is reached, the momentum of compounding takes over and does most of the work for you. To put it another way, carefully investing 10-20k per annum is less important once your returns are about 30k anyway. That’s the meaning of ‘escape velocity’.

You’ll find that at this point ($1m) you’re as paranoid as ever about losing your money through tax, fraud, arbitrary government seizure or freezing of your assets, whatever. You’ll be thinking of ways to avoid it, keep some overseas, bank vaults full of gold, diamonds sewn into your clothes, your cardigan made bulletproof.


By all means, get advice and don’t put all your eggs in the one basket. There are some tips here. However, your chances of running out of money at this point are extremely low.

You’ve made it. In fact, you’d made it from age 30.

For everyone else

The figures here are aspirational, not a requirement. The closer you can get, the closer you are to financial freedom.

If you’re 30, debt-free and have $20K saved, that’s a good foundation. You can work with that.

If you’re 40 and have $100K, you’re a better chance of a comfortable retirement than a lot of your peers.

However, the older you are, the harder you’ll have to work to make up for lost time. To reach your goals faster, increase your income if you can, live a frugal life and save as much as possible.

At any age, the axiom holds: saving a little now is easier than saving more later. It’s better to invest in your 20s than in your 40s, but it’s also better to invest in your 40s than in your 60s.

How about you? What amount do you consider firmly adequate to have saved by any given age?

  • This article provides general information. It does not take into account your personal circumstances and is not intended to influence readers’ financial decisions. Get your own, professional advice.


  1. toastedposts · March 12

    You would need to continually make something like $200k/yr (half+ gets taken in taxes) to make these net worth targets (starting at 30.) I only barely started making that at age 38, and briefly (as the project got cancelled). Other engineering jobs only paid around $120k-ish, so I’m pretty far behind those goals.

    I’ve never been profligate, but until I was in a place where I wanted to settle and buy a house, rent and expenses ate income pretty rapidly.

    My various mutual funds and retirement accounts never returned the promised 10% (the one I had when younger ate any gains with fees until I finally switched. One did okay-ish, but every recession knocks me back to a little over square 1.)

    Liked by 1 person

    • Nikolai Vladivostok · March 12

      That’s interesting. I was earning much less but got closer to these milestones. There are many variables here, including that I was living overseas and sometimes had rent covered by employers.
      Anyway, it’s much easier to start at 20 than to start at 30, even if you’re earning peanuts. Those peanuts compound.
      Mutual funds promised 10%? The long-term stock market average is more like 7%.
      What do others think? What income is required to meet these targets? Mention your country of residence as that seems relevant, especially in terms of tax.


      • toastedposts · March 12

        Country of residence: America
        The “things I did wrong” wrt saving large amounts of my income have absolutely nothing to do with luxury spending. (Moralizing about eating out or luxury spending as below sort of grates when groceries are $200/week anyway, and no amount of eating out will matter to the Nx$100k net worth targets you mention.) The things that eat half the remainder of half (taxes) your income (leaving you with ~25% to save) are unavoidable fixed expenses. A tiny apartment if you live in a city, or a modest house if not, utilities, local taxes and fees, etc. A “luxury computer” costs something like $2000. Insignificant. A reasonable car costs something like $25k when I bought mine, but more like $30k used today.

        Thing 1. I joined the military, partially to pay for undergrad. Pros: No student debt. Cons: Low pay for 5 years, and you move a lot so buying a house never makes sense. Additional cons: I wouldn’t recommend this at all today, because you are placing yourself under the orders of DSM diagnosible psycopaths who are pursuing goals that have nothing to do with the welfare of your country.

        Thing 2: Living in $city for 5 years. Cities are traps. I had a reason to be there, but it wasn’t good financially.

        Thing 3. Living in California for 3 years. The pay was good and the work looked (at the time) like it might result in something actually meaningful to the world, but the state is otherwise nightmarish, and finds a way to eat the difference. You might make $200k/year instead of $120ishk/year, but your expenses will be more than double, and you get to experience a post-apocalyptic 80s movie firsthand.

        After about 12 years of work I’ve finally settled somewhere relatively sane where I can help my extended family (though the entire world is a sinking ship, and it’s only a matter of time until the open banditry and lawlessness finds its way here.) Now that I have a house, that $2500/month (trying to pay my mortgage down faster to avoid interest eating it all) is going to equity instead of rent on a dismal shoebox apartment.

        That’s why I’m about 10 years behind your targets, but will do my best to save something going forward.

        Liked by 1 person

      • toastedposts · March 12

        I suppose my main point is:

        Luxuries aren’t very significant as expenses/drags on saving go (unless you’re seriously splurging on something stupid like an $80k truck or EV).

        What is significant is where you choose to live, and how soon you can manage to own property. Also career choices: I’m a somewhat overeducated engineer/physicist, which isn’t the best from a raw money perspective because of the years I had to sink into school. Mastering the right sort of trade in a fixed location, rather than banging about the country chasing work, would have worked out better.

        Liked by 1 person

        • Nikolai Vladivostok · March 13

          Geo-arbitrage certainly makes a difference, much more than I realised. I reckon we can guess what city you lived in. Good to hear you’re in a better place.

          Liked by 1 person

        • Kentucky Gent · March 14

          Something seems off, toastedposts.

          Like you, I also am a physicist/engineer. Went into approx. $60k debt for grad school. Got my PhD in 2006 and didn’t pay off student loans until 2013. Plus 1 brand new car and 1 house along the way. Spent lots of money eating out (mainly Red Lobster) and gambling in Vegas.

          My last location was high-rent: $1475/month. Had 3 long stints of unemployment, incluing first 10 months after graduation. Yet from 2006 until 2020 I accumulated enough to retire. My total time receiving a paycheck was 11 years 3 months.

          My best year of compensation was my last one, earning $154k counting my employer’s 401k match. For you, making ~$120k, it should take less than 14 years to financial independence. My 2 biggest questions about your situation are 1) what are you investing in? and 2) what are your annual expenses?

          Are you investing during market crashes? I was literally borrowing money in March 2020 to invest in the COVID crash, and I hope you did as well. Your fund choices sound pretty bad. IMO You should only invest in 3 different funds: VOO, VTI and QQQ. I buy individual stocks. Your annual expenses should be <$33,000 even if your rent is $1400 plus.


    • Anonymous · March 12

      I’m 30 with a net worth of ~$140k, and my highest salary earnings in a year were about $50k. I’ve been fairly lucky with crypto though, which accounts for probably a third of that value. On average since I started working full time at 23 I’ve spent 60% of my income every year. I live in a fairly low cost country where I was able to buy and pay off a small place a couple years ago, killing my rent expense. Also had the advantage of no debt starting out (tertiary education and first car I still drive paid for by parents).

      Liked by 2 people

  2. mblanc46 · March 12

    Mme B and I have upwards of $2 million, not including two paid-for residential properties. It’s mostly in stocks. We’re in our 70s. Until the past couple of years I’d thought that it would take a really bad run for us to not make it to the end in reasonable comfort. Since the beginning of the Plague Panic and ensuing money-printing, followed by the election of a lunatic federal government, I’m getting concerned that what survives a market crash will be inflated away. Your mileposts are reasonable for a sustained period of economic stability. Whether we’re looking at a sustained period of economic stability in the foreseeable future remains to be seen.

    Liked by 1 person

    • Nikolai Vladivostok · March 12

      If you’re in your 70s, have $2M saved plus a paid-off house or two, it would take a Mad Max level catastrophe to wipe you out, in which case you’d have bigger problems (like feral kids throwing metal boomerangs at you).
      Inflation is a concern but you are diversified into real estate, which inflation will cause to increase in value.
      The amounts in the article are the ‘relax’ points, and you can relax. You’ve made it.
      If in doubt, invest in a GT Falcon and some shotgun cartridges so that you can raid other survivors for fuel.

      Liked by 2 people

  3. Frank K · March 12

    A lot of people think that you have to be a financial genius to have money in the bank, when it’s actually quite simple: live far below your means and save the surplus. Sure, it means you won’t drive cool cars, take expensive vacations or eat out at fancy restaurants. But when you’re in your 50’s you won’t have to worry about losing your job and can even retire early.

    Liked by 1 person

    • Kentucky Gent · March 14

      I agree with Frank K. And the most important part of Nikolai’s advice, IMO, is “live a frugal life and save as much as possible.”

      Because frugality is a double-edged weapon. Not only do you save more when frugal, but you also don’t need to save as much in total. Netting $60k/year, but living on $40k, means you need to work 2 years to save 1 years’ expenses. But living on $20k means you save 2 years’ expenses in 1 year.


      • HazHap · March 17

        Seconding this. Keeping expenses low is key, for the double effect of saving more and then those savings lasting longer. Minimizing taxes is vital for keeping total expenses low, which often means moving to a lower tax jurisdiction if at all possible. Expensive cities in high tax states can be terrible for your long term finances, even though salaries appear to be great. Unless you really are making the truly big bucks, you do not actually come out ahead long term.


  4. Pingback: This is financial advice (for Smaug) | SovietMen

Leave a Reply

Fill in your details below or click an icon to log in: Logo

You are commenting using your account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s