I’m only 27 and hit my first $100,000 in non-retirement assets – here’s how I did it

A 27-year-old Reddit user posted recently to share his financial success. He explained that he had hit his first $100K in non-retirement assets. Part of this was from savings, but he had also made impressive gains in the market. In fact, he’d earned over $33K in returns in his brokerage account, and his account summary showed he had a 49.53% return rate. 

The fact that he has $100K so young means he is in great shape for the future since this money can grow as a result of compound interest and help him become very wealthy over time — even without huge additional contributions. He also wanted to share his wins to demonstrate how he’d managed to hit his target so early. 

A diversified portfolio helped the Reddit user to grow his wealth

The Reddit user shared his investments and he had a good mix of different assets in his portfolio This included some index funds, including a fund tracking the performance of the S&P 500. It also included some shares of stock in individual companies.

Having both index funds and shares of stock in individual companies likely helped this Redditor earn such impressive returns, and can be a good approach for many investors. That’s because index funds minimize risk while limiting potential gains as your assets are spread out across many different stocks. Buying individual company shares, on the other hand, creates the potential for you to earn larger gains if the company does well, but also increases your risk if the company performs poorly. 

Now, some investors are skilled at researching individual companies and understand what to look for in terms of assessing growth potential. It makes good sense for them to invest more in individual companies because of the chance they could earn higher potential returns. Others, however, may not have the knowledge or skill to decide which businesses to invest in and an entire portfolio full of index funds is a better bet for them.

When you decide what to invest in, you should know which of these categories you fit into. A financial advisor can provide some advice on these different approaches, and help you to decide what makes sense given your risk tolerance and investing acumen. 

Regular contributions to a brokerage account are key to success

Regardless of whether you opt to buy index funds or shares of individual companies, the reality is that investing in the stock market in some capacity is going to play an instrumental role in helping you grow your net worth. 

The Reddit user in this scenario very likely would not have hit $100K so early if he hadn’t earned $33K in returns to help him get there. Sure, he made regular contributions, which is very important. But by putting his money to work for him, he was able to grow his wealth much faster than he could have on his own.

This is an important lesson for anyone trying to get ahead financially. You should open an account that allows you to invest, put money into it as quickly and aggressively as you can, and build a diversified portfolio. This path will help you get to $100K and beyond so you can build the wealth that will make financial freedom possible. 

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