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Building and growing your own online businesses can be an incredible way to get some extra cash. In the case of our interviewee today, it was great way for him to become a millionaire in less than 10 years.
Marc from Vital Dollar joins me today to discuss how during his 30’s he went from a $50,000 net worth to $1,400,000.
The Young Millionaire Interviews continue my friends! Enjoy our 10th interview!
How old are you? If you have a family, tell us about them and their ages.
I’m 39 years old, unfortunately approaching 40 very quickly. My wife’s name is Crystal and we have two kids (our daughter is 5 and our son is 3).
What part of the country do you live in? Do you own your home or rent?
We live in Pennsylvania and we own our home. I rented an apartment before we were married and we bought our first home (a condo) when we’d been married for about 6 months. We’ve been married for 12 years now, so I guess we’ve been homeowners for about 11.5 years between the 3 different houses that we’ve lived in. The longer I’m a homeowner, the more appealing renting sounds. I love our house, but it takes a lot of work and money to maintain the house and property.
When did you start tracking your net worth? What was it at that time?
I only started tracking our net worth within the past year. I had done a rough calculation in a spreadsheet a couple of times over the past five years or so, but never anything consistently. When I got more immersed in the world of finance blogging I started to see a lot of ads and recommendations for Personal Capital, so I thought I should try it out. Earlier this year when I first started using Personal Capital I think our net worth was about $1.4 million.
What is your current net worth? What are your assets and what are your liabilities?
Our current net worth is about $1.7 million. That includes about $400,000 of equity in our home (we bought it for $417,500 with cash two years ago). The rest is in money market and savings accounts, 401(k)s and IRA’s (all with Vanguard), and other non-retirement accounts with Vanguard.
We don’t have any debt aside from credit cards that we pay off each month. At our previous home, we did have a 30-year mortgage, but we were able to pay it off in 4 years. We lived without a mortgage at that house for about 2 years and didn’t want to go back to having a mortgage, so when we moved 2 years ago we decided to pay cash for the house.
We have two cars with no car loans, but I don’t factor that into our net worth. Honestly, I have no idea what they are worth, but probably not that much. We have a 2010 Mazda Tribute with about 75,000 miles on it, and a 2012 Mazda3 with about 40,000 miles on it. With neither of us working outside the home we don’t put a ton of miles on our cars.
We do have fairly high property taxes (almost $9,000 per year) considering we live in a small town. I know that’s nothing compared to what someone in San Francisco or some other places would pay, but it’s a lot more than most areas away from major cities. Property taxes are high in our county for some reason, but at least the public schools are pretty good.
What are your current sources of income? If married, does your spouse have other income sources?
I’ve been self-employed in internet marketing for the past 10 years. My wife has been a stay-at-home mom for almost 6 years now. Before we had kids she worked in finance.
My income the past 10 years has been pretty good (six figures the past 9 years), but it varies wildly. The biggest reason it varies so much is that I’ve sold a number of websites and online businesses. That means I get a nice lump sum of money, but then my recurring income drops because I’ve sold off an income-producing asset. Just two months ago I sold a blog that had been our primary source of income for the past year, so I’m kind of starting over right now.
The lump sums from these sales have been the single biggest contributing factor to getting us over the hump of $1 million in net worth. Selling a website can be a great thing if you are able to replace that income.
My website sales have been:
- 2010 – $50,000
- 2013 – $500,000
- 2016 – $500,000
- 2017 – $225,000 (this was an Amazon FBA business that was a partnership with my wife)
- 2018 – $216,000 ($194,400 after broker fees)
Our daughter started kindergarten this year and our son has about 3 more years until he starts. When both kids are in school my wife will probably do something part-time, but we’re hoping she’ll work with me rather than getting a part-time job. Three years is still a long time though, so we’ll see what happens.
Related Podcast: How to Become a Millionaire by 30 – with Grant Sabatier
What has been the single best thing you’ve done to increase your income up to this point?
I guess I kind of answered this in the previous question in terms of selling the websites. But going back one step further, the decision for me to start my own business made a huge impact on our finances.
When I was 30, almost 10 years ago, I think our net worth was probably about $50,000 or somewhere around there. We had been married two years and we owned a condo, but we bought right before the market crash so we were upside down on that.
Over the past 10 years, my income has probably been 4-5 times what I would have made if I had stayed at my old job.
I worked on my business part-time for a year and a half before it got to the point that we felt safe with me quitting my job. We made some sacrifices, especially in terms of our time together, but it paid off pretty quickly.
What ways do you invest your money?
Right now most of our investments are with Vanguard. That money is basically in index funds, target retirement funds, and what Vanguard calls “LifeStrategy” funds. We do have some in a REIT as well. I’m planning to change up some things in the near future and try dividend stocks and some other types of investments that will produce passive income.
Did you receive an inheritance or windfall of some kind during your life so far?
No inheritance, but we did have some windfalls from the larger website sales.
What debts do you have (if any)? If so, what are they? Which have you paid off?
We have no debt aside from credit card bills that are paid each month. We did initially have loans on both of our cars, but we paid them off in one year each. When we replace those cars we’ll most likely pay cash.
We were fortunate to both graduate college with no student loans. We did that by making some sacrifices in college, by avoiding expenses schools, and my parents also helped me. My wife’s parents worked at our college so she got free tuition. She lived on campus and paid for room and board herself.
We’ve been mortgage-free for about 4 years now. We hadn’t planned on paying off our mortgage early, but when my wife left her job we decided with only one inconsistent income it reduced our stress level to have the mortgage paid off.
How do you track your net worth?
I use Personal Capital.
What are your annual expenses?
About $60,000. I expect that to increase though because we have a lot of things that we want to do with our house and property.
What is your favorite fintech tool that helps you grow your wealth?
I’d say Personal Capital. It doesn’t directly help me to make more money but there’s something about seeing your net worth that motivates you and changes the way you make financial decisions. I really wish I had started tracking net worth a long time ago.
Related Podcast: How to Consistently Save $85,000 Per Year – with Jamila Souffrant
Why is it important for you to build up your wealth?
The biggest reason is an attempt to increase the security for my family. When I left my job 10 years ago to pursue an online business I didn’t really know what the future would hold. Things on the internet change so fast that it’s hard to predict what will happen more than a couple of years into the future. I’ve always felt like I’m fortunate to be able to make money while I can because that could change at any time. My goal has been to build up a nest egg and if I do have to go back to a real job at least we’ll have a good start on our retirement savings.
What is one financial mistake you’ve made during your young millionaire journey?
I think the biggest mistake I made was not starting my own business earlier. I was 28 when I started my business and I left my full-time job the week I turned 30. My 20’s were mostly a waste financially. That’s not because I was bad at managing my money, but because I just wasn’t making enough. Once I started my own business things changed drastically.
What book has been most influential to you?
I’ve read very few books. I just don’t have the patience to sit down and read long things. That’s probably not good, but it’s the truth. The one book I did read that has had a huge impact on me is called “The Hole in Our Gospel”. It’s not really a financial book, but it does have significant financial ramifications.
As a disclaimer, the book is probably only going to be of interest to Christians, in case that wasn’t obvious from the title. The book was written by Richard Stearns, who is the President (soon to be retired) of the humanitarian organization World Vision. I read the book because my wife and I have been supporters of World Vision for about 8 years and within the past few years I’ve been very interested in studying what Jesus says about money in the Bible.
The book basically looks at what God expects of us as His followers, and specifically how it impacts our concern for people in need. There are a lot of alarming statistics about the impact the American church could have on worldwide poverty if we wanted to. I’d say I was already sharing the views expressed in the book before I read it, but it really cemented those views and caused me to have a much greater sense of urgency to take action on it.
What is one financial hack that has helped you that you think most people don’t know about?
About 7 years ago we started working with a new accountant. The first time we met with him he told us we could have saved $9,000 in taxes the previous year by making a change to my business structure. The business is an LLC and the change was to move to being taxed as an S-Corp. We took his advice (he did the work for us) and we’ve saved a considerable amount in taxes over the past several years.
I’m not an accountant so I won’t try to explain it, but for anyone who has an LLC I would recommend talking to an account to see if changing to S-Corp status for tax purposes would help you. Obviously, everyone’s situation is different.
We do have some added accounting expenses related the S-Corp status, but the tax savings more than offset it.
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— Andy Hill (@AndyHillMKM) October 5, 2018
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Where do you find the most joy in your life?
I enjoy spending time with my family and supporting causes that are important to me (either financially or through my time). I also get a lot of joy when my favorite football team (the University of Miami) wins.
My favorite things to do on my own are hiking and nature photography, which I was able to use with my business for several years. I have an article How I Turned a Photography Hobby Into $1,138,610 that talks about that.
For the 20-something with a $0 net worth, what advice would you give them to become a millionaire in their 30’s?
My first piece of advice is to start saving right away. You might be tempted to wait on saving since you’re young, but those years are by far the best time to save because of the impact of compounding.
Next, I would advise them to make an effort to increase their income. For me, that meant starting my own business. For someone else, it could be getting a certification, improving a valuable skill, or starting a side hustle. Any extra money that you can make (and save) will help you to reach your goals a lot faster. Being thrifty and saving money is great, but increasing your income can often have more powerful results.
Where are you in your net worth journey?
Please let me know in the comments below!
Track your net worth today for FREE with Personal Capital. It’s the first step on your journey to becoming a young millionaire!