Having a net worth of even $100,000 is a major accomplishment. According to a Federal Reserve survey, the median net worth for someone who’s under the age of 35 and is the head of household is $39,000. That number increases with age, but not so many people get past the six-figure mark, at least not for a long time.
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This isn’t too surprising considering how many financial roadblocks people have to overcome to reach those higher net worth figures. From the increased cost of living to inflation to keeping to a consistent investing schedule, it can be hard to reach even six figures — much less seven.
But hard doesn’t mean impossible.
GOBankingRates spoke with Nicole Stanley, someone who’s on the path to reaching the seven-figure mark, about her journey and the challenges she has faced along the way.
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An Introduction to Nicole Stanley
Stanley is a Latina founder, business owner and head financial coach of Arise Financial Coaching, a company that has aided hundreds of women in getting out of debt, saving money and becoming confident investors. After paying off debt and building her family’s net worth through strategic investing, she found her passion for helping other women build and change their communities through wealth.
Stanley is currently on track to become a millionaire. But like many people, she had her share of money challenges before getting to where she is today.
“My family went from $30,000 in debt to a $250,000 net worth on an average $56,000 annual salary in under a decade,” she said. “As a person who is a quarter millionaire at age 31, my projection is to become a millionaire by age 38.”
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3 Challenges in Building That 6-Figure Net Worth
When asked about the top money challenges she has faced in keeping her net worth at six figures, Stanley said: “Some of the challenges in keeping our net worth at six figures [have] been the cost of housing, inflation and keeping a consistent investing schedule. Things are more expensive now than they were at the beginning of our journey: housing, food costs, travel, etc.”
Let’s break some of this down.
The cost of housing has steadily increased over the years. According to the National Association of Realtors (NAR), the national median home price went from just over $165,000 in 2011 to a little over $357,000 in 2021. Currently, the median sales price of homes in the USA hovers at just over $420,000 — about $150,000 higher than it was a decade ago.
In 2021, consumer prices were up 8.6% across the board, according to the Bureau of Labor Statistics. Inflation rates have stabilized recently with an annual inflation rate of 3.3% for the 12 months ending in May. However, certain things — like food away from home, energy services and transportation services — have increased more than that.
As for investing, doing so consistently — and strategically — in the face of rising prices and economic uncertainty can be a challenge in and of itself. Stanley’s family has managed to overcome this particular challenge through automation and dedication.
“We combat this by staying dedicated to investing in our employee-sponsored investment accounts and our Roth IRAs,” she said. “Automating our investing has been life-changing. We ‘set it and forget it’ so that we can handle the other financial stressors in our lives with more ease and our investments continue to grow.”
Roadblocks to the Path of Becoming a Millionaire
Even those who are on track to building their net worth might start to fall behind or indulge in self-limiting behaviors that keep them from getting to or past that six-figure net worth goal. Oftentimes, these behaviors might not even be immediately apparent.
If you’re trying to keep your net worth at six figures or get beyond that goal, there are two major things that can happen to keep you from getting there.
“Some of the things that can affect someone’s path to becoming a millionaire when they’re already on that trajectory is lifestyle creep and becoming more lackadaisical with investing as a priority,” Stanley said. “As your net worth increases, assuming your income also increases, it’s easier than ever to spend that increase instead of investing it.”
Fortunately, there’s a solution to every problem. And sometimes, that solution is simpler than you think.
“It’s important to remember why you started investing in the first place and what investing can bring to your life: security and peace of mind,” Stanley said.
By being consistent and focused on your goals — and by investing consistently — you can continue building your net worth and reach your own net worth goals.
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This article originally appeared on GOBankingRates.com: I’m Almost a Millionaire: 3 Money Challenges Keeping My Net Worth at 6 Figures
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