Filed in General by on April 14, 2016 0 Comments
This month my wife and I hit a pretty major goal, we became millionaires.  Yes, millionaires! How was this determined, you ask?  Through www.mint.com; which we use to track our budget and net worth.  This month the update email came through with the following first line:

Your Monthly Financial Summary
Tuesday, March 1, 2016 – Thursday, March 31, 2016
YOUR MONEY                                             $1,013,820.97

1The number above equates to our net worth as calculated by www.mint.com. Simply, it is our assets minus our liabilities. If you have more assets (i.e., houses, cars, cash in the bank, etc.) than liabilities (i.e., mortgages, car loans, credit cards, etc.) then you have a positive net worth. This, however, DOES NOT mean that we have a million dollars sitting in the bank, but that our assets are worth a million dollars more than our liabilities.  Most of this number is on paper – it’s the equity in our home, the equity in our rentals, the value of our cars, retirement accounts and bank accounts.

There are many number of ways to get there.  My wife and I have chosen to live a relatively frugal life, save a lot, carry little debt, and buy appreciating assets that we understand.  Some people go the other way, and carry a lot of debt, but also have more assets.

Now don’t get me wrong, I am not trying to down play the achievement by any means. My wife and I have worked extremely hard and sacrificed much to achieve this in our thirties. It is extremely exciting to now be able to call ourselves “millionaires,” but we are not sitting on the beach sipping on pina coladas either. I am actually at the office two hours before anyone else comes in writing this article. I will be working until 8 pm tonight hosting a webinar. I work several 12-15 hour days per month, and I often find my wife logging into her computer to work after we put our son to sleep.

We have 2 cars that are fully paid off.  My wife’s car has 200,000 miles on it and it is going strong.  My car has 70,000 miles.  We plan on driving these until they die and then replacing them with used cars.  Are they the nicest, cleanest, smoothest vehicles on the road?  Not by any means, but they run well and cost us very little.

Our house is a modest 1,200 sq ft home. It is beginning to feel a bit crowded with a 3 year old and 2another on the way, but people have made this work for hundreds of years, at least the 117 years of our home, so why should we be different? That being said, we do fight the urge to keep up with the Jones’.  Could we sell our house and buy something bigger and better or alternatively add on to our existing home to make it bigger and better? Sure, but we’ve chosen not to in lieu of spending monies elsewhere (i.e., investment properties).  We were blessed/smart enough/lucky enough to buy in Sloans Lake and the Highlands area of Denver back in 2010. That area has skyrocketed with appreciation and growth.  There are bigger and better houses being built every day.  But we also bought smart. We bought the day before the house went to foreclosure auction and had to fix up the property. It was a full interior and exterior renovation and my wife and I did a lot of the work ourselves.  It is now worth more than double what we bought it for through the forced appreciation of the repairs and the appreciation of the market recovering.

We have 2 rental properties, a single family home in Aurora and a duplex in SW Denver. Like our primary residence, the purchase of these two properties follows a similar thread in that we purchased right (i.e., great timing, below market purchase price) and have benefited from a rising market. Our Aurora property has doubled in value since purchase, and I just saw a similar duplex to ours in SW Denver come on the market for $140,000 more than what we bought ours for. Both of these properties have required fix up and maintenance along the way.  We manage the properties ourselves, and although it could be said that it is a great time to be managing your own properties, there is certainly a cost to it.  We have not had that 2 am phone call for a sewer back up, but we have had tenants leave the house needing full renovation, a mold remediation, and hassles with the city over parking and the ever continuing struggle to get rent paid on time.

3Yes, we have worked hard and sacrificed a lot, but I still indulge a bit and pick up a morning coffee and breakfast burrito from a local shop, as well as eat out for lunch almost every day. These are little things but, health concerns aside, they keep me happy.  We share a passion for traveling – as evidenced by the 3 weeks in Europe before our son was born, or the 3 weeks in South Africa with our son and my wife’s family, or the long weekend we are taking to San Diego later this spring – but we have prioritized this love and would prefer to live a “normal” life and do the things we’re passionate about than keep up with the Jones’. So, we plan, we save, and we make smart investments. We have benefited greatly by this recovery and will undoubtedly take a hit when the next down turn comes, but if we stay true to our principles of planning, saving, working hard and making smart investments, we will certainly weather that storm and continue to be “millionaires” for a long time to come.

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