Joining the Million Dollar Club/Challenge and So Can You
Today, we are going to talk about networth and how we are joining the Million Dollar Club/Challenge which is a club/challenge that can be joined by anyone who wants to be a millionaire, or who’s already a millionaire and wants to continue progressing.
A millionaire is someone who has a networth of at least one million. Investopedia defines networth as “The amount by which assets exceed liabilities. Net worth is a concept applicable to individuals as a key measure of how much an entity is worth. A consistent increase in net worth indicates good financial health”.
In summary, to calculate your networth, you add all your assets and deduct all your liabilities. It’s a good way to track how you are progressing and how close you are to being financially independent.
The good thing about tracking your networth, is that you get to see where you are doing great and where you need to improve. In our case, we started tracking our networth in December last year, and we will continue tracking/updating it at least once year.
A lot of personal finance bloggers, including ourselves, publicly disclose/track our networth in order to motivate ourselves and our readers. The tracker can be found here: Rockstar Finance Networth tracker.
Below, are the details of our networth. We are showing the amounts in both Canadian dollars and US dollars for our American and international readers and for also tracking purposes with the Rockstar Finance Networth tracker.
$100K Emergency Fund/Short term investments
As you can see we have a lot in emergency fund/short term investments. We are paranoid about going back to being broke so we keep a healthy emergency fund. In one of our previous post, we talked about how we spend only 15% of our income.
Therefore, that $100K emergency fund can last us more than 2-3 years should both of us stop working.
Note that a lot of it is in short term investments, and not just sitting around in a savings account collecting $0 interests, or laying under the mattress collecting dust 😊.
We live in HCOL (High Cost Of Living) area and we have had real estate agents knock on our door offering $1.3M+ but we are staying put and raising Baby99to1percent and any future babies here. Once they are out of the house, we might then downsize and cash in.
And we are valuing the house at only $1.1M, instead of the $1.3M+ we have been offered since the government is introducing a lot of new rules trying to cool down the real estate market.
But at the same time, they are limiting the number of detached houses to be built, thus we think our detached house will continue to increase in value year after year.
We bought the house for $560K 5 years ago, added $40,000 in upgrades for a total of $600K. We took a 30 year mortgage and since we were about to get married, and dealing with wedding expenses, we took the risk and put down only 5% instead of the recommended 20% (I know, shame on us 😊).
It turned out not to be a bad idea actually, because if we had waited a year or 2 to come up with the 20%, we would have been priced out since in our neighborhood, houses have been increasing about $100K+/year.
The consulting business
We are conservatively valuing the business at $850K, because we won’t really know how much it’s worth until we sell it if ever. We have had offers, but we are not entertaining anything below a certain amount.
The business is in a very nice, small but potentially lucrative niche. We just found an even easier way to recruit clients, and now we have to figure out an easier way to recruit the specialized, talented employees that we need in order to service the clients.
We feel that if we stick with it, it has the potential to make us millions a year and it might be our ticket from the 1% to the 0.01%. This blog is about progress, prosperity and financial independence after all.
Other assets include 2 cars and an engagement ring. Mr99to1percent bought the ring online at a discount for $20,000. When we had to appraise it for insurance purposes, it was appraised at $30,000 and last year, when we wanted to switch to a cheaper insurance, we were required to have it re-appraised, and we were surprised to see that it had increased in value to $35,000.
The 2 cars that we own are my 13-year-old sedan and Mr99to1percent’s 11-year-old SUV. We don’t have any car loans, and we drive our cars until they completely fall apart.
Our mortgage is our only debt and we have a vision (Vision 2020) of paying it off in 2020 at 39 years old. We are trying to pay off $80K-$100K/year and that will allow us to meet our vision (see details here). With a new baby, it’s been challenging but we are determined to pay it off by 2020.
We don’t have any other liabilities. We pay off our credit cards each month. I can’t remember the last time I paid interest. I always say that instead of giving the money to the bankers, give it to charity instead.
How did we do it?
- We paid off student loans before graduating. In this blog post, we detailed how we moved from broke with a negative net worth (student loans, car loans, ) to finding good jobs, and paying off student loans before graduating.
- We increased our income from $0 to $160K to $400K+. And we plan to continue doubling it every 5 years. Join our challenge here.
- We bought our dream (to us) house as soon as we could. If we had waited we could not have done it. We might downsize and cash in once the kiddos are grown and out.
- We are paying off the mortgage faster which will save us $500K in interests and give us the freedom to become more aggressive and increase our income.
- We only spend 15% of our income. We only spend about 15% of our income.
- We read personal finance / career books. Check out our recommended personal finance/career books.
Joining the Million Dollar Club/Challenge
Like I previously mentioned, the good thing about tracking your networth, is that you get to see where you are doing great and where you need to improve. For example, even though our networth seems high on paper, in reality, it’s not enough for us to be financially independent as most of it is tied to the house equity and the business.
Yes, we can decide to sell and cash in, but what if we decide not to cash in and to give those 2 assets to our kid(s)? After all, it’s all about leaving a legacy. Just because we had to suffer and fend for ourselves, put ourselves through school, incurred student loans, worked 2-3 jobs at the same time, lived in not so safe neighborhoods, barely had food to eat, hustled and saved like maniacs to be able to buy our first home and start our first business; doesn’t mean that we should let our kid(s) also suffer and fend for themselves.
That’s why our goal for the next 9-10 years, is to double our networth to $4M. At that point, we will consider ourselves fully financially independent and will be able FIRE (Financially Independent, Retire Early) if we choose to do so. Wouldn’t be sweet to FIRE at 45 years old?
The $4M would not only allow us to FIRE comfortably, but to also pay for our kids’ education, help them become homeowners themselves in this crazy expensive real estate market, and hand over the business to them if they want it.
The $4M would also facilitate our lifelong dream of setting up school(s) for kids, especially underprivileged kids. We tried to start the project this past spring, but we realized how expensive and time consuming it was, especially dealing with government bylaws and bureaucracies.
We ended up wasting thousands of dollars for nothing, and thus, the project has been suspended until we FIRE and have enough money and time to manage the project.
Therefore, we have decided to join J.Money’s Million Dollar Club/Challenge in order to stay focused and motivated. Note that the club can be joined by anyone who wants to be a millionaire, or who’s already a millionaire and wants to continue progressing.
In order to achieve the $4M networth in 9-10 years, we pledge to:
- Continue living below our means, ideally between 15%-20% of our income
- Pay off the mortgage by 2020
- Find ways to continue to double our income every 5 years. Join our challenge here.
- Grow our consulting business every year, by adding clients and employees every year.
- Continue having/creating multiple streams of revenues.
- Double our networth to $4M by the time we are 45 years old.
Can we reach that $4M networth by 45 years old? We think so. We are only in our mid 30’s, and just starting out. Watch this space 😊.
What about you guys? When do you plan to become financially independent? What do you think about the Million Dollar Club/Challenge? Will you join? Or have you already joined? If so let us know where you are with your target.
Thanks for reading. Please feel free to comment, share and subscribe! We love ya and wanna get to know ya!
Do you want an easier way to manage/track your finances/investments? The Personal Capital app can help. Do you want to start blogging? Bluehost can get you started. Make sure to also check out other resources that we recommend such as books that have helped us get where we are.
Do you want to learn more about us? If so, you can also read these other posts:
- About us
- How We Increased Our Annual Income From $0 to $160K to $400K+
- How we live on 15% of our income
- How To Pay Off A Mortgage In 5 Years
- Our Biggest Money Fight and 9 Lessons Learned
Here’s a list of almost 200 people who have already joined the Millionaire Club/Challenge:
- James@ DINK’s Finance [Now a millionaire!!! Breakdown here]
- Ginger@ Ginger Won’t Snap
- Erica@ Erica’s Funny Farm
- Brian@ My Next Buck –> Brian’s millionaire list
- Brad@ Enemy of Debt –> Brad’s millionaire list
- Paul@ Fiscal Geek
- Shawanda@ You Have More Than You Think –> Shawanda’s millionaire list
- Financial Samurai–> Financial Samurai’s millionaire list
- Yellow Piggy Bank
- Michelle@ Penny and Nickel to Wealth –> Michelle’s millionaire list
- Megan@ Student Charade –> Megan’s millionaire list
- LuLu@ How I Save Money –> LuLu’s millionaire list
- Jayde Moss
- The Broke M.B.A.
- Ryan@ Planting Dollars –> Ryan’s millionaire list
- Roger@ The Amateur Financier –> Roger’s millionaire list
- The Financial Blogger–> Financial Blogger’s millionaire list
- Money Wise 24
- BudgetBabe@ Lean with Green –> BudgetBabe’s Millionaire List
- Sabrina@ Freedom 45 –> Sabrina’s Millionaire List
- Jeff Kosola
- Money Handler@ Money Handler’s millionaire list
- Broke by Choice
- Money Reasons–> Money Reasons’ millionaire list
- Barbara Bryn Klare
- Meghan Fife
- FinEngr@ Engineer Your Finances –> FinEngr’s millionaire list
- Harvest Wages
- Matt @ Dividend Monk –> Dividend Monk’s millionaire list
- Budgeting In The Fun Stuff
- Anon Lawyer@ Thoughts of an Anonymous Lawyer –> Anon’s millionaire list [2nd MILLIONAIRE WHO’S MADE IT! Congrats!!]
- Saving Savy Pinky
- Utbytte–> Utbytte’s millionaire list
- Darren@ More Than Finances –> Darren’s millionaire list
- Jeffrey Mitchell
- Ashley Jacobs
- Wendy P.
- Ginger @ Frugal Students – Starting a New Life –> Ginger’s millionaire list
- Will@ Frugal Norwegian –> Will’s millionaire list
- Money Rabbit
- Chris Parsons
- Divas With Cents
- Jack Crown
- BigChrisB@ Debt Digger –> Big Chris’ millionaire list [The first one to a million! Congrats!!]
- Eric@ Post Grad Agenda –> Eric’s millionaire list
- Jamie J
- T. T.
- Jane Sanders
- Dani@ OK, Dani –> Dani’s millionaire list
- Nitza@ Nitza’s Pizza –> Nitza’s millionaire list
- Aspiring Millionaire@ Aspiring Millionaire.com –> Aspiring’s millionaire list
- Multi-Millionaire Before 30–> Multi-Millionaire’s list
- Kelsey Horner
- Kody@ Financial Money Tips –> Kody’s millionaire list
- Steve Ryan
- Jeff@ My Multiple Streams –> Jeff’s millionaire list
- Thema Martin@ Savionaire
- Rich Uncle El@ Money Watch 101 –> Rich Uncle El’s millionaire list
- Long@ Budget For Wealth –> Long’s millionaire list
- Cameron Cohen
- Shondell@ Call Me What You Want, Even Cheap! –> Shondell’s millionaire list
- Busy Executive
- Alunda@ My Take on Money –> Alunda’s millionaire list
- DC@ Young Adult Money –> DC’s millionaire list
- Mike Collins@ Wealthy Turtle –> Mike’s millionaire list
- Just Pay It Off–> JustPayItOff’s millionaire list
- DZ@ Debtzilla –> DZ’s millionaire list
- Lena@ What Mommy Does –> Lena’s millionaire list
- Jim[Another member who’s made it! CONGRATS, Millionaire!]
- Abbie Stokes
- Free Money Minute–> Free Money Minute’s millionaire list
- Anton Ivanov
- Christine@ ThePursuitofGreen –> Christine’s millionaire list
- EJ@ My Millionaire Status Dream –> EJ’s millionaire list
- Kim@ Eyes on The Dollar –> Kim’s millionaire list
- Mel@ Broke Girl Rich
- Izzye G
- Corinne Hoener
- S Dot
- Graham@ Money Stepper
- Kirby@ TheSimpleMoneyBlog
- Bobby@ Making Money Fast and Slow –> Bobby’s millionaire list
- Jessi Mendoza
- Franklin B
- Lisa E.@ Lisa vs. The Loans –> Lisa’s millionaire list
- Deacon Hayes@ Well Kept Wallet –> Deacon’s millionaire list
- Mama Breeze@ Following Life’s Breeze
- Krista and John
- Shannon— Hit millionaire status on 8/10/16!!! Congrats!!
- Mr Ikonz@ Project Ikonz
- Zac@ Money Journal
- No Nonsense Landlord–> Going for $1 Million in *liquid* net worth!
- John C.@ Action Economics –> John’s millionaire list
- F2P@ Free To Pursue –> F2P’s millionaire list
- Derek@ Derek and Carrie –> Derek’s millionaire list
- Cody Wheeler@ Academy Success –> Cody’s millionaire list
- Single Dad@ Single Dad Living –> Single Dad’s millionaire pledge
- Journey To Total Freedom
- Tim Seidler
- Elisha Buffet@ Warren Buffet Wannabe –> Elisha’s millionaire pledge
- Taylor Lee
- Jeff@ Middle Class Success –> Jeff’s millionaire pledge
- Happy Frugaler@ The Happy Frugaler –> Happy Frugaler’s millionaire pledge
- Fervent Finance–> Fervent Finance’s millionaire pledge
- MP@ Mustachian Post –> MP’s millionaire pledge
- M/M Kash
- Gene Roberts
- Joshua Whitaker
- My Road to Wealth and Freedom–> millionaire pledge
- Aja McClanahan
- The Captain@ The Pirates Life For Me –> The Captain’s millionaire pledge
- Gen Y Finance Guy–> Gen Y Finance Guy’s millionaire pledge
- The Money Mine–> Nick’s millionaire pledge
- Live Debt-free in NYC
- Future Beachbum
- Debt Free Fanatic–> Miranda’s millionaire pledge
- Beards and Money–> Dr Beard’s millionaire pledge
- Fiprogress–> Fiprogress’ millionaire pledge
- The Finance Games
- The Green Swan–> millionaire pledge (The first blogger who already *has* a million dollars but is going for multi-millionare status! ;))
- DauvO–> millionaire pledge
- Miss Mazuma–> millionaire pledge
- Dollar Engineer
- A4L–> millionaire pledge
- Travel Travel & Retire!–> millionaire pledge (Just crossed the $500k mark!)
- Our Financial Path–> Xyz’s millionaire pledge
- The Millionaire Educator–> Ed hit a million dollars! Now working towards a trillion 🙂
- Solving Finance
- Her Every Cent Counts–> Joy’s millionaire pledge
- I Vigilante–> The Vigilante’s millionaire pledge
- *Honorary member* My Own Advisor–> Mark hit a million dollars and is now going for a $1 Mil real estate portfolio!
- Rick– Now a millionaire, congrats!
- Adventure Rich–> Mrs Adventure Rich’s millionaire pledge
- *NEW*Smart Budget Life –> Chris’s millionaire pledge
- *NEW*The Frugal Gene –> Lily He-Prudhomme’s millionaire pledge
- *NEW**Honorary member* Steveark –> Hit a million back in his forties 15 years ago, and has since added a few more
- *NEW*Frugal Asian Finance –> FAF’s millionaire pledge
- *NEW* Smart Money–> Mr. Smart Money’s millionaire pledge
- *NEW*The Canny Contractor –> The Canny Contractor’s millionaire pledge
- *NEW*Ms & Mr 99to1percent -> Ms & Mr 99to1percent pledge