The best way to get to a $100k net worth at 25 is to save and invest a majority of your income on a broad based market index like the S&P 500. There’s no need to start a business or play the lottery to build wealth. The simple route to build wealth is the best route to build wealth.
I built up a $200k net worth at 25 because I followed the simple basic rules of building wealth. I increased my income as much as possible, lived below my means, and invested everything I could into the S&P 500. I’m currently 28 and have a $500k net worth to show for it.
It’s not complicated but it is difficult. It was difficult to cook food every night and bring it to work to save money. Not to mention skipping eating out with my friends. I know I’m supposed to “enjoy my 20s” but I would much rather be rich than be poor in my 20s.
I also increased my income to $100k+ by 25, as well. The great part was that I was in the early stages of building wealth so I still had more energy left in me to continue the path. I’m on the 7th year of building wealth and I’m starting to lose energy and enthusiasm to build wealth.
When you’re in your early 20s, that’s the best time to build wealth because you have endless energy. Not only that, achieving progress at a young age just feels great. It sets you up for life into your 30s, if you play it right. All it takes is a little mindset and behavioral shift to get there.
It’s not complicated to get to a $100k net worth at 25.
$100k Net Worth at 25: How to Get Rich in Your 20s
Below are 9 ways on how to get to a $100k net worth at 25. The strategies below are strategies I personally used myself to get there.
1) Start Investing As Soon As Possible
This one is key. A dollar in your 20s is worth far more than a dollar in your 30s and beyond. The power of compounding is surreal. When you start investing from the very first paycheck you receive, magic starts happening. I started investing into my company’s 401k as soon as possible.
Because I started work in the middle of the year, I set aside 50% of my income into my 401k. By the end of the year, that was $14k that went straight into the S&P 500. I literally lived on paycheck to paycheck because my after-tax and after-contribution amount was $700 that was leftover.
Even though every paycheck hurt me, I still kept going. It was a good thing my rent was only $640/mo at the time. I didn’t have time to complain about my situation. If I wanted to go from broke to rich, I knew I had to make sacrifices and make hard choices.
I have zero regrets of what I did. $100k net worth at 25 requires investing a lot, investing often, and investing early.
2) $100k Net Worth at 25: Graduate With a Marketable Degree
For one, I didn’t mess around in school. I got my grades to near pristine condition with a 3.82 GPA. For another, I graduated with a marketable degree that companies will want to pay good money for, Finance. That’s how I increased my income to $100k+ at just 25 years old.
There are many who graduate with good GPAs but they don’t have a marketable degree that companies are willing to pay good money for. It’s a knowledge economy today. Companies pay money for your knowledge that customers can use to buy their products.
It’s difficult to go into finance with a marketing degree. Getting to a $100k net worth at 25 means you need to have a good income to not only pay for your living expenses but to have savings and investments on top. The stability of the industry matters, as well.
We’re dishing out tens of thousands of dollars for a college education. We should take advantage of it as much as possible by getting a good return on investment.
3) Ask for Raises Often
This is one thing that I regret doing. I miraculously received raises often. It took me six months to increase my income from $52.5k to $86k. Then it took me another 15 months to increase my income from $86k to $108k. I didn’t do that because I asked for the raises.
Another company miraculously reached out and gave me a better offer than what I was currently getting paid. For someone who didn’t get as lucky as I did, it’s time to ask for raises often. Your bosses will never offer you more money out of their own accord.
To get to a $100k net worth at 25, it requires increasing income quickly. Investment returns help but it can only help so much. The bulk of the net worth will be from the savings from your income. Provide as much value to your employer as possible.
Then asking for raises will be a cakewalk in the making. The American work culture is toxic but not if you know how to get paid for your efforts.
4) Job Hop If You Top Out Your Salary
If you ask for a raise and the company refuses, even if you have a good performance review, it’s time to dust the old resume and job hop to another company. It’s not “disloyal”. It’s not “selfish”. The company would get rid of you in a second if they had a chance to.
The pandemic taught many that there’s no such thing as job security. Corporations laid off many employees in March 2020 without giving it a second thought. To get to a $100k net worth at 25, it’s time to treat your job as the business relationship it really is.
There’s no team that should be “family”. We’re all just there to make money. The company wants to make money and the employee wants to make money. If the employee costs more money than what they generate, the company gets rid of them.
If the company costs more headaches than the money they pay you, you shouldn’t hesitate to get rid of them in a second, either.
5) Live With Roommates
There’s nothing wrong with living with roommates. Especially because you’re so young, people expect you to have roommates in the first place. Roommates are not just a college experience. It goes beyond that. I’m 28 years old and I still live with a roommate.
It cuts my rent in half. I would pay $1300+ if I lived by myself. I only pay ~$700/mo, all-in, because I live with a roommate. Housing is one of the biggest expenses people have. When we can halve that, it makes getting to a $100k net worth at 25 that much easier.
Even though my income now is $200k+, I still live with a roommate. I know that will turbocharge my wealth building efforts that much faster. When I become a millionaire, I’m not going to regret living with a roommate, even though I prefer to be alone.
$100k net worth at 25 means cutting down expenses as much as possible.
6) Don’t Go Out Weekly to Bars
I get it. You were so used to having $0 income in your college years that once you have money, you want to live it up!! That’s not right. There’s nothing in the bars that’s worth having over a $100k net worth at 25. After graduation, my friends went out to bars and spent money.
I was squirreled away in my house, watching Netflix videos and enjoying being alone. It really helped because my net worth just kept rising and rising with no end in sight. That’s not to say that I didn’t occasionally go out. However, it does mean that I didn’t spend my money frivolously.
I didn’t care about “living my best life”. All I cared about was creating the best life I could for myself. I know one day, I’m going to thank my younger self for not messing around after college graduation. I’m going to be happy that I sacrificed to get to the elusive millionaire status.
Having fun is OK, but spending money is not the only way to have fun. There are many free entertainment options out there.
7) $100k Net Worth at 25: Drive a Cheap but Reliable Car
Even though I bought a car in 2022 because I got into a car wreck, if I didn’t get into a car wreck, I would still be driving the same beater car. I had a $10.3k 2015 Nissan Versa Hatchback and everything was fine and dandy until the perpetrator didn’t stop properly at a stop sign.
Their insurance covered the new car, thank goodness. However, the moral of the story is that getting a new car every so often is a waste of money. I drive the most reliable cars out there with little maintenance issues besides the usual oil changes here and there.
I spent $10k, all-in for my first car and there was no need for me to spend more on a flashy new car. $100k net worth at 25 means controlling one of the most expensive line items in your budget. Which is transportation.
There’s no need to buy a $25k new car when a $10k car gets the job done, too. It’s one of the best ways to show off our stealth wealth signs.
8) Cook at Home
$20 here and there throughout the week adds up over time. When I first started my wealth building journey, I cooked on Sunday and meal prepped. Not only did I learn how to cook, I saved money while doing so, too. It saved me thousands of dollars over the 2 years I did so.
Nowadays, my time is worth way more than the hours it takes to cook and do the dishes. Therefore, I don’t do it anymore. However, when you’re first starting out, your time is not worth very much. Therefore, to get to a $100k net worth at 25 means cooking at home. It helps more than you know.
It doesn’t even have to be for forever, either, and may only be necessary for 1 – 3 years. Afterwards, you can save time and enjoy more delicious food by eating out. Even though I eat out every day, I still don’t spend a lot of money. I spend ~$5/day on food, after taking advantage of all the rewards programs.
It’s a good thing that I don’t really need to eat a lot to keep me satiated. I spend so little on food because I know the 10 benefits of saving money.
9) Use Coupons, Buy in Bulk, and Wait for Sales
There’s nothing wrong with waiting for deals. Saving money requires putting ego aside and making purchasing decisions that are in your best business interest. For big purchases, I specifically wait for Holidays for sales to happen.
For Black Friday 2022, I waited until I could get a brand new MacBook Pro for only $899.99 from Costco. Not only that, it included a free Costco membership as well. I rushed over to the store and actually called their customer service department to make sure the purchase went through.
There’s nothing wrong with shopping clearance and waiting out for the sales. $100 saved here and there really adds up throughout the year. There’s nothing wrong with buying the exact same product but just at a cheaper price.
Building to a $100k net worth at 25 means putting ego and pride aside and saving as much money as possible whenever you can.
$100k Net Worth at 25 is Possible
One thing I wish I did earlier was get a Costco membership. Although I’m generally good at finding deals at the local grocery store, I didn’t know just how great Costco was until I got the membership in late 2022. That would’ve allowed me to save even more money.
Maybe I could even saved more money by 25, who knows! $100k net worth at 25 is possible because salaries are increasing to keep up with inflation. Just look at the salary statistics for the University of Texas at Austin. College graduates are, on average, earning $80k/year.
That’s a lot! Companies are increasing salaries for specialized jobs at a faster pace than ever before. It’s time to take advantage of the boom because companies are paying top dollar for top talent. Companies have more money than what they know to do with, as a result of the COVID stimulus money.
Although they keep the majority of the money for themselves, that doesn’t mean they still don’t pass down some of their profits onto their employees. $100k net worth at 25 is more possible than ever before because of the wide availability of information in the internet age.
There’s an unlimited amount of opportunities to save money, build wealth, and practice sound investing strategies. It’s amazing that millionaires give this personal finance advice on the internet all for free. It’s time to take advantage and stand on our own two feet.
Our future depends on it.
$100k Net Worth at 25: How to Get There Shortlist
- Start investing as soon as possible
- $100k net worth at 25: graduate with a marketable degree
- Ask for raises often
- Job hop if you top out your salary
- Live with roommates
- Don’t go out weekly to bars
- $100k net worth at 25: drive a cheap but reliable car
- Cook at home
- Use coupons, buy in bulk, and wait for sales
