I occasionally peruse the Bogleheads online forum for advice and inspiration on my finances. One amazing aspect about online forums is that there is almost always an answer for everything. There are many data-minded people out there to do the calculations and plenty others who are itching to poke out flaws and nitpick.
While I’ve developed a thick skin to comparing my finances to those of others online, it is always humbling to read about some poor soul who is much younger than you with a much higher net worth frantically asking for financial advice.
A few days ago, someone who was 27 years young with an emergency fund of $275,000 and a tax-advantaged account value of over $100,000 (Roth IRA, 401k) asked about where to put $150,000 in a taxable account. By doctor standards, this guy is wealthy. When I was his age, I was well into a negative six-figure net worth. A doctor in her 30’s would have to be somewhat knowledgeable about finances to be in a similar financial situation (A large percentage of doctors have less than $500,000 in savings!).
This scenario does remind me of two lessons:
1. Everyone’s Circumstances Are Different. How someone manages to build a certain net worth at a certain age has little bearing on how you build own net worth. You may have started from scratch while someone else may have had a windfall. It’s not their fault that you spent ten years of your life learning to become a doctor while someone else spent that time making money. Likewise, just because you are a decade behind financially you are not condemned to a lifetime of financial failure. Psychology is a powerful phenomenon. Use that to your advantage. Let it not hinder but fuel your hunger to succeed.
2. You Can Only Control What Happens To You. It doesn’t matter if your neighbor or the guy on the Internet has a huge amounts of wealth. It’s not like they are going to give it to you. However, you can control how wealthy you can become. If someone from the Internet can do it, so can you. If a random guy can save 70% of his income on a $100,000 annual salary, you can certainly do so on a $200,000 income! You just have to ask yourself how badly you want it and what you need to modify your lifestyle to get there.
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