How to Become a Millionaire in your 30’s – Interview 11 (Juan)

October 18, 2018

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When you truly become intentional about your actions, there’s little you can’t accomplish.

The next member of the Young Millionaire’s Club is walking, talking proof that good things come to the intentional.

Juan from A Journey to FI joins me today to discuss how taking some short-term sacrifices in his life lead to some long-term financial wins for his family. At a $1.3 million net worth in his late 30’s, Juan is charging toward financial independence and not stopping to look back.

Let’s welcome Juan!

The Details

How old are you? If you have a family, tell us about them and their ages.

I’m 38 years old, happily married for 9 years and blessed with two amazing boys. Our oldest is 4 years old and he’s honestly the one who keeps me in shape. I think he skipped the crawling and walking phases and went straight to running. He loves sports, playing with friends and being a big brother.

Our youngest joined us exactly 12 months ago and again … we continue to be blessed. We call him little speedy Gonzalez because, as opposed to his big brother, he’s taking it easy and hasn’t started walking yet. However, when it comes to crawling, we have to be extra careful when we put him on the floor cause as soon as we take our eyes off of him, he’ll be somewhere else.

I could go on and on talking about my family but honestly who wouldn’t? They motivate me, they bring me joy and are the reason I live a happy life.

What part of the country do you live in? Do you own your home or rent?

We live in Thornton, Colorado and have been in the area for the past 3 years. We have rented in the past but currently own the house we live in.

When did you start tracking your net worth? What was it at that time?

I started tracking my net worth using Excel sheets back in 2009; however, it was a very rudimentary process. I’m having a hard time remembering what it was so I wouldn’t like to guess and therefore give you the impression that my net worth increased by X amount since I started. Today, I do a better job tracking my number using Personal Capital. I started using it back in 2015. At that point in time my net worth was ~ $750M.

What is your current net worth? And what is it made up of?

Today, my net worth is sitting at ~$1.3MM. My Financial money map is a good summary of what it is composed of; however, allow me to summarize it for you:

Assets: ~$1.9MM

  • Cash
    • Checking accounts
    • Online Saving accounts
  • Investments
    • 401(k) Traditional and Roth
    • HSA
    • Roth IRA(s)
    • Brokerage accounts
    • 529(s)
    • Peer to peer lending
    • Individual Stocks
  • Real Estate
    • Primary home – Financed
    • Rental properties (4X) – (2X) Personal – Financed & (2X) Partnership – Cash

Liabilities: ~$600M

  • Credit card(s)
  • Car loan (1X)
  • Mortgage (3X) – Primary home & 2 rentals

The Process

What are your current sources of income? 

My job is by far our main source of income; however, we have some passive income coming from our rentals and dividends from investing in the stock market. On the latter, we have been intentional about letting dividends to be automatically reinvested as opposed to allowing them to hit any of our spending accounts.

As for your second question, our story is somewhat unique in that when we got married, my wife moved to the US from our home country and was not allowed to work. Things changed and after some time she became eligible to work; however, after having our first boy we both realized that it was more important for her to stay at home to raise our kid than going back to work. With that being said, we have been able to build our nest egg based on one income.

What has been the single best thing you’ve done to increase your income up to this point?

I find it difficult to boil things down to a single thing. In my opinion, it has been the combination of many intentional decisions that have allowed us to achieve our current results. If you allow me to expand, the first decision was to pursue a high paying career as an engineer in my home country of Venezuela. The second one, and perhaps the most difficult one was to pursue graduate studies in the US and leaving my family, friends and my girlfriend behind. My goal was to better my professional development and expose myself to opportunities in hopes of a better future. Fast forward 10 years, and today I continue to let intentionality be the main driver of the decisions we make as a family. When you couple that with things like frugality, living below your means, and avoiding lifestyle inflation, and you could end up with results like the ones I’m sharing with you today.  

Related Podcast5 steps to take after becoming debt-free

What ways do you invest your money?

In general, I’ve tried to keep things simple by investing in paper assets and real estate. I’ve entertained the idea of starting a business but that is still a work in progress. When it comes to paper assets, my strategy is centered around low-cost index fund investing with an asset allocation of 93% stocks and 7% bonds. I give more details of my investment portfolio on my site but below is a quick summary of all my accounts:

  • 401(k) – Fidelity: FSEVX, FXAIX, VIVIX, VTSNX, Company stock
  • Roth IRA – Fidelity: FSTVX
  • HSA – Fidelity: FTSVX
  • Roth IRA(s) – Vanguard: VTSAX
  • 529(s) – Vanguard: VITPX
  • Taxable – Vanguard: VTI
  • Taxable – Betterment: 90/10 with various funds

I also invest in individual stocks but that represents less than 1% of my net worth. In addition, I invest in real estate with 2 rentals of my own and 2 that I’ve purchased with a partner. I should add P2P lending but that is less than 0.5% of my net worth.

Did you receive an inheritance or windfall of some kind during your life so far?

This is an interesting question. If I were to be literal, I would say No, I have not received an inheritance or a windfall during my life and do not expect to receive one. However, I have and continue to receive more important things other than money from my parents. Their love, teachings and support have led me to be where I am today. I am a man of faith, a father, brother and member of a family and it’s all because of them. Thanks mom, thanks dad!

What debts do you have (if any)? If so, what are they? Which have you paid off?

Unfortunately, we are not debt free; however, I’m trying to get to the point where our only debt is the mortgage on our primary home. Currently, we have the following:

  • Credit card debt: Fully paid every month and have never paid interest. We take advantage of travel hacking and are very disciplined on utilization making sure we use them for needs, i.e. fixed expenses.
  • Primary home mortgage: We put 20% down when we bought our house and were able to lock a 3.125% interest rate for a 30-year loan. Sometimes, I think about paying extra but I struggle to do so given the competitive rate I was able to lock. To compensate, I make bi-weekly payments that translate to 13 payments in a year. I’m good with that at least for now.
  • Rental mortgage(s): I put 20% down on each of my properties and decided not to accelerate paying them off. They have been rented for 2 years and have been cash flowing from day 1. My tenants are covering the mortgage so no need for me to do anything else at this time.

How do you track your net worth?

I’ve been using Personal Capital since 2015. I love it!

Do you budget your money monthly?

I haven’t budgeted in a long time. I’m a strong believer in paying yourself first and taking full advantage of automation. As a result, all my buckets are taken care of and whatever is left on my checking account is guilt-free money. I do keep track of my expenses once a month to make sure our expenditures are in line with our expectations and to make sure there are no surprises (fees). This strategy works for us; however, creating a budget is a great tool if you are getting started. There is nothing more important than tracking your expenses and being vulnerable to recognize what your spending habits are.

What are your annual expenses?

Instead of providing a $ amount, let me share the categories that capture 80% of our annual expenses:

  1. Mortgage on the primary home
  2. Daycare
  3. Groceries
  4. Travel
  5. Eating out
  6. Transportation

What is your favorite fintech tool that helps you grow your wealth?

Not sure I would call this a fintech tool but the one thing that has helped me grow my wealth is listening to Personal Finance podcasts and doing research. If it hadn’t been for the information and insights shared on these resources, I’m not really sure if I would be on my quest for achieving Financial Independence. My favorite podcasts and books include:

Related article: 5 Books to Skyrocket Your Net Worth

Millionaire in the Making

How do you feel about becoming a young millionaire?

I don’t think about becoming a millionaire, instead my goal is achieving financial independence which I define as reaching that point in life in which you generate enough passive income to cover your monthly expenses. As a result, you give yourself options to keep doing what you’re doing or explore other things that bring joy to your life.   

Why is it important for you to build up your wealth?

One word … options … so that I can: 

  • …spend more time with my family.
  • …better support my parents and extended family if needed.
  • …continue to work at my current job if that’s what I want.
  • …leave my job if that’s what I would like to do.
  • …change jobs even if it pays less but brings me more happiness.
  • ….do more traveling.
  • ….never have to worry about money.

What is one financial mistake you’ve made along your young millionaire journey?

I’ve been a saver for as long as I can remember; however, saving is just one element of the strategy to generate wealth. This takes me to my biggest financial mistake which was not starting to invest earlier and missing out on the miracle of compounding for ~6 years.

What book has been influential to you on your financial journey?

I can’t avoid thinking about two books. The first one is “The Automatic Millionaire” from David Bach. This was a game changer for me because it cemented the idea of paying yourself first coupled with automation. The second one was “The Simple Path to Wealth” from JL Collins. The title of this book really does justice to its content. Investing does not have to be complicated and honestly, it can be very simple. VTSAX is the name of the game at least for me :)  

Listen to my weekly podcast to grow your family’s wealth!

What is one financial hack that has helped you that you think most people don’t know about?

Two things come to mind:

  1. Travel Rewards. Today we sit at ~ 500K miles, a companion pass and cash back. This has not resulted in lifestyle inflation, increased expenditure (wants vs needs) or payment of late fees. Instead, we have accomplished these milestones by timing the opening of new cards with large expenses and using them for every fixed expenditure around our house.
  2. I will ask for a discount on almost on every purchase. You’ll be surprised the discounts you can get if you only take the time to ask. My favorite saying is “If you don’t ask you don’t get”

Where do you find the most joy in your life?

At home with my family and during trips. No matter where we are, as long as we are together, I’m a happy man.

What’s one piece of advice you’d give to someone who wants to become a young millionaire like you?

Popular recommendations include:

1) tracking your expenses

2) creating a budget

3) automation

4) living below your means

5) starting to invest early

6) using low-cost index funds, etc.

I like all of these but honestly, the one piece of advice I would give someone is “to be intentional” and understand that every action has a consequence. If you're intentional about:

  • …tracking your expenses then the consequence is you’ll have a better understanding of what your spending habits are.
  • …creating a budget, you’ll have a tracking mechanism that will allow you to make progress and see how well you’re doing.
  • …leveraging automation, you’ll potentially enjoy the benefits of paying yourself first and avoid fees.
  • …living below your means, you’ll enjoy the fruits of avoiding lifestyle inflation.
  • …investing earlier, you’ll take advantage of years and years of compounding.
  • …using low-cost index funds, you’ll be saving yourself a significant amount of money in fund fees.

I think you get my point :)

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!

Andy Hill

Andy Hill, AFC® is the award-winning family finance coach behind Marriage Kids and Money - a platform dedicated to helping families build wealth and happiness. With millions of podcast downloads and video views, Andy’s message of family financial empowerment has resonated with listeners, readers and viewers across the world. When he's not "talking money", Andy enjoys being a Soccer Dad, singing karaoke with his wife and relaxing on his hammock.


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