Welcome to Kiplinger’s My First $1 Million series, in which we hear from people who have made $1 million. They’re sharing how they did it and what they’re doing with it.
This time, we hear from a married 74-year-old retired marketing and communications consultant for global technology firms. He lives, and works part time, in Southern New Hampshire and is originally from New York City.
See our earlier profiles, including a writer in New England, a literacy interventionist in Colorado, a semiretired entrepreneur in Nashville and an events industry CEO in Northern New Jersey. (See all of the profiles here.)
Each profile features one person or couple, who will always be completely anonymous to readers, answering questions to help our readers learn from their experience.
These features are intended to provide a window into how different people build their savings — they’re not intended to provide financial advice.
I first achieved the $1 million milestone in 2017 at the age of 66. It was earned over a 40-year period of conservative investing in low-cost domestic and international stock and bond funds.
A modest inheritance from my parents came when they both passed within a year. I invested in a Vanguard Balanced Fund. I still own that fund, and over 30 years, it has increased 400% in share value.
We plan to live comfortably in a retirement community with available health care and pay for health care as our needs evolve.
We also want to leave the remaining balance to our children and grandchildren.
I took my wife to dinner. We have a low-maintenance lifestyle, so this was a milestone to be appreciated for gaining peace of mind in our imminent retirement years.
Emotional relief. Barring economic catastrophe or severe health issues, we secured a base level of economic independence.
The money provided a glide path into our retirement years and enabled us to pay down our mortgage and remaining debts.
My wife retired in her early 60s. I retired at my full retirement age of 66 after my job was transferred to a distant office, and I opted to accept a modest financial buyout.
This enabled me to maintain health coverage until I became eligible for Medicare and Social Security.
We invested with an adviser affiliated with two major brokerage firms, but the investment advice resulted in higher commissions for the firms than returns for our account.
We switched to Vanguard brokerage in the early 2000s and never looked back. Our adviser at Vanguard is a fiduciary and has our interests as his goal.
Vanguard advisory fees are less costly than a typical independent adviser who might charge 1% to 1.5% of invested assets annually.
Mentors at my workplace understood much of what I’ve stated above. They didn’t always express it, but they led by example.
Try saving a little more each month. It hurts your lifestyle a little, but it makes a big difference in a few decades. Save at least 10% to 15% of your monthly earnings, plus any company matches.
Also, during the Great Recession, I was laid off from three separate jobs. The most critical issues were maintaining some income, health insurance for my wife and myself and avoiding raiding our retirement funds for living expenses.
We were able to do this by these methods (which others could apply to their own situation):
Never stop networking! Always maintain professional connections even when it’s inconvenient.
You never know when a job will sour, and it’s an advantage to have connections who can help. A little paranoia in the business world is useful!
We have a will, a power of attorney and a living will. Our estate planning attorney advised these actions based on our types of assets and assuming straightforward probate.
When you first started saving? You can never predict the future. Jobs may be lost instantly — your employer doesn’t care about you except for the immediate returns you contribute. They may hire a younger, cheaper person — you are expendable.
Save your money, live below your means and take advantage of every dollar match contributed by your employer.
When you first started investing? Read John C. Bogle (founder of Vanguard Investments) to understand the power of low-fee investing.
Don’t raid your retirement funds no matter how tempting. You cannot make up lost funds once you’re retired and living on a fixed income.
Before you retired? I did research on geographic locations, health care, long-term care costs and options, so there were not a lot of unknowns by the time retirement age came around.
Kiplinger is a valuable resource for researching where to live, taxes, health care and housing costs. Plan for the worst, adapt and execute your plan under the current circumstances.
When you first started working with a financial professional? If you feel unheard, don’t understand the investment advice or cannot speak honestly about your fears and financial goals, look elsewhere.
Much like a marriage, you are in a partnership where both parties benefit from trust.
