How I Grew my Net Worth to $100,000 by Age 25

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For today’s post, I’m sharing how I grew my net worth to over $100,000 by age 25! My personal financial situation growing up that got me to where I am today, my biggest money regrets / mistakes (to guarantee you avoid them) and what I did correctly!

That seems really exciting and fun to discuss but I feel a sort of awkwardness while writing this… I don’t know if people will think that’s a lot or a little but I guess we’re going to find out!

Also, I should mention! I’m no longer 25, I’m 26 now and I wrote this before “Saving with Sofi” even existed. It took me a while to post this however, because of the above mentioned fear of judgement. I digress.

Before we get started I’m throwing in a shameless plug… How do you calculate your net worth? Use my net worth tracker spreadsheet! Click here to access that spreadsheet for FREE by signing up to my email list!

Let’s get into the chisme.

Table of Contents

Back to the Beginning

I want to paint a clear picture about my financial situation.

I don’t have a crazy story about how I grew up in poverty, managed to get into college and graduated with 400k in debt, only to pay it off and be 100k richer at 25.

That wasn’t my situation at all and I want to acknowledge how privilege played a huge role in getting me to where I am. I was very lucky growing up. My mom put in hard work chasing the American Dream so I didn’t have to.

My mom was born and raised in Mexico (shout out Mami!!). When she was 20, her parents decided to move to the United States.

They packed all their things into a camper (where they lived for a while) and moved here to start a small business. Unfortunately, as happens more often than not, the business wasn’t as successful as hoped. Additionally, It was a huge change in lifestyle coming from a comfortable high middle class home in Mexico.

After two years trying to make the American Dream a reality my grandparents decided it was a lost cause and moved back to Mexico with what they could salvage. Of the 7 of them who had moved, only my mom and my aunt stayed in the United States; they wanted to finish school.

The family lost almost everything they had trying to make it in the U.S. Because of this experience, my mom quickly learned the importance of saving money. She was able to work and put herself through college, then a masters program!

Saving money, and working your ass off, became ingrained; then later passed on to me.

She once told me the day she found out she was pregnant was the day she started saving for my college tuition. I had one of those “this is why I am the way that I am” moments when she told me; meaning I have to plan everything extremely in advance or I’ll stress out :D.

So ya, I was incredibly lucky to have such an amazing, capable mom who led by example when it came to finances. It meant I got to graduate without student loans and I got a first hand look at how working hard can pay off.

How I Spent All The Money I Made/Saved Growing Up and During College

Although I was able to avoid student loans (again thank you mom!!) I somehow managed to blow any, and all, money I had saved growing up…

During college I studied abroad. My mom and I agreed she would pay for my rent and I would pay for all my travels, a pretty sweet ass deal if you ask me! Let’s just say, I did not hold back! 12 countries later… I had no money! But it was fine, because I was going back to school for senior year!

I should mention, I did have a job all throughout college. However, I was paid 10 dollars an hour and only worked 10 hours a week. So this was pretty much just my grocery and boba money.

Then graduation happened, wooo class of 2017!

My dad took me to TD Ameritrade where I opened up a Roth IRA and a regular trading account (big day, big dayyyy). Additionally, I was able to get a full time job as an accounts receivable clerk making $16 dollars an hour. Things were looking up!

I also set up an auto transfer to start putting money into both of these accounts every month. The ball started rolling!

However, 6 months after starting the new job, I decided I wanted to become a CPA and work in public accounting. I started job hunting and studying for the CPA exam.

I was able to get a job offer in the Bay Area starting in October 2018, which meant I had 10 months to work and study for my exams. A few months later, I learned balancing my accounts receivable job and studying for the CPA was absolutely brutal.

So much so that after a couple months of walking up at 4:30 am to study before work, I decided to quit my job to focus on studying. I was once again extremely privileged here. I was living at home and didn’t have many expenses. It became the perfect opportunity to study full time and knock out my CPA exams before my new job. However it did mean I had to turn off my auto-transfer and I wasn’t saving money anymore.

After paying a bunch of fees, and yes I truly mean a bunch, for my exams and living without an income, it was finally time to move! My salary had increased, my auto-transfers had started again and I was ready to take on the real adult world!

My biggest money mistakes.

Mistake #1: Overpaying for Rent

For those of you that don’t know, the Bay Area holds some of the most expensive cities in the United States. The only other competition is New York. So it is no surprise that rent was going to be expensive.

My first Bay Area apartment, aka my 1,400 dollar a month apartment (which if you don’t live here, this is a steal, it was a two bed two bath dual master apartment ahh, clarification, my half was $1,400 the total was $2,800), well it had cockroaches…. And those suckers DO NOT LEAVE. Believe me. We tried.

Since the cockroaches wouldn’t leave, we had to leave.

Then, there were some more unforeseen circumstances, which I don’t need to dive into. But, long story short, my new rent was 1,800 dollars. Which was MORE than an entire paycheck.

Just… Wow.

The cherry on top, which was 100% my fault, was that I didn’t leave when the lease was up!

In my defense, it was busy season! For those of you non-accountants, that’s when accountants go into an excel cave and don’t come out from January to March. But that is no excuse. I didn’t leave and the rent had now increased to 2,000 dollars with utilities. Ouch.

Note: If you’re wondering about my living situation now, I ended up leaving that 2k apartment early and finding a subletter. The pandemic started, I didn’t need to go into work so I moved to the suburbs in East Bay where I was paying 900 dollars less in rent. And now, when prepping this post, I actually don’t have a lease! Which, damn not paying rent is a dream….

Mistake #2: Not Actually Investing

Remember how I said I started transferring money into my Roth and regular trading account? Well I was transferring money… However it was just sitting there.

I wasn’t actually investing any of it.

DO NOT DO THIS! I miraculously got very lucky.

Covid had begun, I was working from home, and I decided to FINALLY do some research into which index fund ETFs I should be investing in. On March 27th 2020, I dumped all of the money I had been saving for the last three years into the market.

Which, if you don’t remember what was going on in the market during March 2020. Here is a little visual for you.

The result? A year later, the account was 3x the size. Before you check my math, that number isn’t 100% related to capital gains because I continued to contribute regularly (and some extra because of the previously mentioned money I was saving on rent).

I think standing alone, the money I already had in the account grew about 1.7 – 1.8x (after one year) simply because of when I invested it. Which is still a wild return! Again, I got lucky.

Even though I got lucky, this is a TERRIBLE thing to do. If you’re going to invest money, make sure you’re actually investing it! Preferably consistently, regardless of what the market is doing. Don’t let it just sit, not growing, there like I did.

It seems like investing is really difficult, but it doesn’t have to be! Especially when robo-investors exist and diversify for you. You can learn how to invest easily nowadays! Read more about investing for beginners here.

Things I Did Right – That You Should Do Too

Commit to Your Goals

Although my rent was an entire paycheck, I was dedicated to saving 1,000 dollars a month no matter what! If that meant I couldn’t buy new clothes or eat out, I was going to do it.

This basically forced me to only spend on necessary items or the money would run out. It was here that I started taking money more seriously and learning about my spending habits.

Figuring out how much it costs you to live is EXTREMELY important. So yes, this means you have to track your expenses and actually know where your money is going. Once you know how much you need to live, you can set up automatic transfers to make sure you are hitting your savings goals.

However, I don’t recommend being as strict as I was. I cut out a lot of “fun” things and the most important part of budgeting is having a balance, not limiting yourself. Limiting yourself is not sustainable or healthy; and honestly, it’s also no fun.

Set goals, but make sure they are feasible and attainable.

Make a Budget and Track Your Expenses

Sure this doesn’t sound sexy. But creating a budget and tracking your expenses are some of the best ways you can get to know your spending habits and truly see where your money is going.

If you are making financial goals without a budget, you’re kind of just guessing where your money is going and you don’t know if these goals are attainable.

If you take the time to create a budget you’ll know EXACTLY where all your money is going and be able to set feasible, attainable financial goals!

I’ve been tracking my expenses for years and it’s kind of fun to compare how much I’ve spent throughout the years! I can compare pre-covid to during covid; I can compare how much I spent depending on where I live, who I was hanging out with, when I was single vs. in a relationship! Not to mention I know how much all my vacations have cost me. How awesome is that?

Maybe I’m just a werido who loves having data on myself… Regardless, a budget has helped me create goals, hold myself accountable and track my progress!

Take Advantage of Your 401(k)

If your work offers a 401(k) you best be contributing!!

Moreover, if your employer offers a 401(k) match… that should be your number one priority! That is FREE MONEY they are giving you. Take the free money! (Well technically it’s priority number 3… you can read about your money “priority” list from this post).

You should consider your income the amount you get paid after contributing the minimum amount required to get your full employer match %. Meaning if they match 5%, you better be contributing 5%.

Last time I checked my 401k, my employer match amount alone was $9,000. That’s WILD. I literally have received a free 9 thousand dollars for simply just contributing 6% of my salary the last 3 years!

Normalize Free Activities with Friends

The most common social activity seems to be going out for dinner or drinks. Let’s change that!

If anytime you want to see a friend you’re going out for a drink, those bills can really start to add up. Start setting the precedent for different types of activities. Normalize board game nights at home.

Set up hikes with your friends or a picnic in the park!

There are so many fun activities that don’t involve money. It might even be fun to come up with new activities you haven’t done before.

Save / Make Extra Money When You Can

If you don’t want to go full on side hustle mode, you can still make extra cash or save extra cash without a lot of work.

What does this mean?

Instead of donating your clothes when you’re clearing out your closet, sell them!

Instead of buying a new couch, look around on Facebook marketplace.

There are so many little ways to save money here and there! One of my favorites is using Rakuten to get cash back on your purchases! This year I got $120 from using Rakuten on purchases I would have made anyway. Check out this post to find out more about Rakuten and more about saving money on all your purchases.

My favorite “side hustle,” not really a side hustle, is being a dog walker for Wag. I really enjoy doing this because 1. Who doesn’t love dogs? And 2. It allows you to make extra money without a strict schedule.

If I want to watch a dog for a week and make 200-300 dollars I can. However, if I’m swamped and can’t do any walks for a month, that’s ok too! I get flexibility when I need it, but plenty of chances to make some good side money as well.

Find an activity that can make extra money and works with your schedule!

Final Thoughts

I was able to save $100,000 by age 25.

I was committed to taking my savings goals seriously, maybe even a little too seriously. It can seem hard and it’s kind of a bummer to always be thinking about money. However, if you put in the time, make a budget and track your expenses, I truly believe you can accomplish your financial goals! Just recognize it takes time.

I feel empowered knowing I’m taking control of my finances and I know you can do it too.

Grab one of my free budget templates for google sheets to help get you started. Additionally, shop ALL my budget templates at The Budget Empire!

So let’s get rich together! Aka let’s be smart with our money from the beginning so it can work for us and we can all retire early together! How exciting!