# How long would it take you to save $100,000.00 cash?



## Montrealer (Sep 13, 2010)

Like the title says: 

How long would it take you to save $100,000.00 cash? And once you do save it up, where and how would you invest it? 

Post your thoughts, ideas and tips!


----------



## Jon_Snow (May 20, 2009)

About 25 months... If we decide to kill our mortgage, we could do it in less than 20 months. Living below one's means WORKS. It's nice not having to rely on market returns to get ahead.


----------



## Four Pillars (Apr 5, 2009)

I think we could do it in 3 years if we were really motivated (which we're not). Five is more likely.


----------



## andrewf (Mar 1, 2010)

At my current savings rate, about 4 - 5 years.


----------



## crazyjackcsa (Aug 8, 2010)

You mean like saving it into a sock drawer? IE, not allowing for interest to accumulate? Given current savings rates: 20 years, If we for some reason really pushed it: 7 years. If we forsake all else (ie house upkeep, car upkeep, any gifts, holidays or anything) 5 years.

As I've said before, we're on the lower end of the income scale as compared to others on cmf. Our current savings rate is about 8% of gross income. We could easily push that to 16% if we put mortgage prepayment and RESPs on hold.


----------



## Ihatetaxes (May 5, 2010)

6-8 months. Now that the mortgage is paid off we are putting aside tons of dough. I take quarterly bonuses on top of a $112k base and the first three this year have added up to $209k so I should be around $350k this year depending on Q4. Not bad for a commissioned sales guy.


----------



## Plugging Along (Jan 3, 2011)

If we reallocated all of our current savings (RSPS, RESP, etc), stopped extra mortgage payments, but maintained the a general same lifestyle, about 1.5 years. If we went into frugal crisis mode, we could probably do it in about 8 months but it would be tricky to pull out because wouldn't have the same flexibility with taxes.


----------



## steve41 (Apr 18, 2009)

Why not ask a more meaningful question....

"I have $X saved already, I gross $Y in salary, plan to retire at age Z. How much should I continue to save each year such that I can maintain a constant lifestyle (budget) out to a comfortable age (95 say)?"

Why do we persist in these simplistic planning mantras such as the '4% withdrawal rule', 'how much do I need to retire on?', etc.

We are, each of us, sitting on computer power unprecedented even 2 decades ago. Why don't we use it?


----------



## Liquid Independence (Oct 6, 2011)

On my current single income, about 6-7 years I guess. Once saved, I would invest half in the local real estate, and the other half split between gold bullion and dividend paying stocks.


----------



## Montrealer (Sep 13, 2010)

crazyjackcsa said:


> You mean like saving it into a sock drawer? IE, not allowing for interest to accumulate? Given current savings rates: 20 years, If we for some reason really pushed it: 7 years. If we forsake all else (ie house upkeep, car upkeep, any gifts, holidays or anything) 5 years.
> 
> As I've said before, we're on the lower end of the income scale as compared to others on cmf. Our current savings rate is about 8% of gross income. We could easily push that to 16% if we put mortgage prepayment and RESPs on hold.


No, by "cash" I meant not invested in a stock, GIC, mutual fund or property, $100,000.00 cash in a checking or savings account that you have access to anytime, anywhere etc.


----------



## donald (Apr 18, 2011)

It took me nine yrs to do(20-29)it was hard!!
Ive saved about 60k from 30-32.


----------



## Montrealer (Sep 13, 2010)

Very nice, I did not save up much in my 20's (refer to my post in the biggest financial mistakes thread), however, my goal now is to save $100,000.00 a.s.a.p.


----------



## donald (Apr 18, 2011)

Im trying to hit a million in 8yrs,excluding real estate(doesnt count in my books,even if its paid off)Im in my sweet spot i think (30-40),ill need help from mr market.It would feel awesome to see a 7 digit portfolio!Couple hundred k in growth stocks,couple hundred k in income stocks.The key is to get a half a million working by 36,and drip the shitout of income(cvx,fts,abt,mmm,T,Pm,cat)ect........wynn,apple,tif,x,ect on the growth side.Trying to set up a formula!Thats the tough part!And Tune out the nay sayers lol.


----------



## DanFo (Apr 9, 2011)

If It was all I concentrated on I could probably do it in 2 years...What would I spend it on?? Nothing I really want would cost even half of that but a garage would be nice in the backyard.


----------



## Montrealer (Sep 13, 2010)

donald said:


> Im trying to hit a million in 8yrs,excluding real estate(doesnt count in my books,even if its paid off)Im in my sweet spot i think (30-40),ill need help from mr market.It would feel awesome to see a 7 digit portfolio!Couple hundred k in growth stocks,couple hundred k in income stocks.The key is to get a half a million working by 36,and drip the shitout of income(cvx,fts,abt,mmm,T,Pm,cat)ect........wynn,apple,tif,x,ect on the growth side.Trying to set up a formula!Thats the tough part!And Tune out the nay sayers lol.


What do you do for a living? 

$1,000,000.00 in 8 years is $125,000.00 per year, is that just savings or growth as well?


----------



## Addy (Mar 12, 2010)

At our current rate of savings, which is modest right now as we've recently dropped down to one income, and considering you said sitting in an account (which currently pays 2.5%) it would take at least 12 years. We could do it faster if we omit our RESP, TFSA, RESP and some discretionary spending but I think it would still take us at least 8 years realistically.


----------



## donald (Apr 18, 2011)

Pa,im talking about building off my base(which is in play right now,inside my portfolio)spread between a rrsp,tfsa,and a non reg.Ive got a 160k book vaule portfolio right now,by 36(4yrs) to get it to a half million,im working out a plan now,should be able to get @ least 200k more in it in 4 yrs.I own a small construction firm.Ill know more as i go.

Plugging,how long did it take you to reach a 100k in savings?age?


----------



## steve41 (Apr 18, 2009)

It has been my experience, that when you factor in a salary which grows at say, 2% faster than inflation (merit raises and career advances), your savings rate will be very small in the early years. 

I see a lot of plans, and I find that most individuals won't start saving in earnest until their mid 40s.

Adding to this skewed savings effect is that, in those early years you will be busy paying off your mortgage and raising your kids.


----------



## marina628 (Dec 14, 2010)

It took me 17 months to save $100,000 cash .


----------



## Plugging Along (Jan 3, 2011)

^Tough answer, I don’t know the specifics for myself, as my spouse and I have been together for a really long time, so I count our networth together. We had our first $100K in investment accounts/cash (combined and not including our real estate) when I was about 25 & 27 (he’s a couple of years older). Part of it was we invested in a couple really high risk start ups and did really well. We probably had $200K together by 30/32. I didn’t count that we also saved up for two down payments on two properties that came from our other funds as you said you don’t count real estate. Each of those down payments took about 2 years of saving a lot, some luck in our investments, and not really having the huge expense of kids. 

Our goal is to have our vacation property paid off in 3 years or less, and try at save additional $50 k for emergency/float on top of our normal savings rate at the same time. We anticipate to be able to save about $100k more in our registered accounts (just savings, no growth), and $50K for float money while I make a transition of our business. My age will be 40 at the time. I’m targeting $1 Mil in all our investment accounts by the time I turn 45 (8 years) realistically, assuming transition works well, and kids don’t cost more than planned, and there are no layoffs, etc. All of these numbers also assume that I stick with my spouse  We're hoping to have $1 mil by 40 (in 4 years), but I don't see that happening unless our high risk gambles pay off.


----------



## Cal (Jun 17, 2009)

legally or....?


----------



## Plugging Along (Jan 3, 2011)

steve41 said:


> I see a lot of plans, and I find that most individuals won't start saving in earnest until their mid 40s.
> 
> Adding to this skewed savings effect is that, in those early years you will be busy paying off your mortgage and raising your kids.


Great point about the age. Though spouse and I have always had decent earnings, when we were young, we were too stupid to save that much because we were young. Now with kids and a mortgage, it makes it much harder. We figured that when our last mortgage is paid off, and we're not paying for childcare or private school, we'll be able to put in another $50-60K a year. That will probably not happen until we are in our 40's. 

I also find with kids, I am less willing to take risks with our incomes to make the bigger money with less stability (like consulting, etc).


----------



## atrp2biz (Sep 22, 2010)

We live off of my salary and save my wife's income within the professional corporation. We are not touching it (taking it out of the PC)--forever (just pay the taxes). However, we do take out distributions up to $50K (essentially tax free at the personal level).

We'll likely do an estate freeze in a few years so that the bulk of the value of the PC can be passed down to our children.

At this rate, we save $100K in four months. In a few years it will be on a monthly basis.


----------



## donald (Apr 18, 2011)

Atrp2biz:I take it @ your point your building generation wealth.You are completely in the drivers seat.Do you ever worry if your children will be able to handle it?Do you teach them about money?Do they know the vaule of a dollar?This is none of my business im just curious,im guessing there will be multiple millions passed on.Do they know?


----------



## KaeJS (Sep 28, 2010)

It would take me 8.3 years at my current savings rate.

And others are doing it in a year....


----------



## englishguy29 (Feb 20, 2011)

I'm 35 and my wife and I have that saved now + just not sure what to do with it... that's the hard question. Whether to put on the mortgage or do something else...


----------



## jamesbe (May 8, 2010)

Based on me putting 25k a year extra in my rrsp the last few years I'll say 4 years.

But then I'd be tighter because I no longer have the tax savings.


----------



## Dmoney (Apr 28, 2011)

KaeJS said:


> It would take me 8.3 years at my current savings rate.
> 
> And others are doing it in a year....


And some are doing it in a few months...

But you're young...
And so am I

I'd say if I don't count investment income I could do it in 4 years as is, 3 if I really really *reallllly* scrimped.

Depending what my bonus is, it could be a shorter time period but I have no clue what to expect in the bonus department.

I'm curious what some of those who can save 100K in less than a year do for a living/have invested/do to be able to save so quickly???

Hoping to one day be in their shoes.


----------



## ddkay (Nov 20, 2010)

Wow @ some people saving 25 grand / month. That takes some serious cash flow. In the olden days people used to have humongous families and use income pooling. Well they still do that in places like rural China, but they're competing for hundreds and thousands not hundreds of thousands.


----------



## Jon_Snow (May 20, 2009)

Don't underestimate the advantages of dual incomes. Once I started living with my future wife, and we made the decision to combine our finances, the wealth accumulation really took off.


----------



## LBCfan (Jan 13, 2011)

I suppose we could do it over a 2-4 year period without much of a life-style hit. Problem, for us, is why? To leave it to our "ungrateful" children?

Being retired and with enough to handle our needs, and probably our wants, until age 120 why bother?


----------



## the-royal-mail (Dec 11, 2009)

I believe the OP is using our responses to feed his blog content. Hopefully I'm wrong.


----------



## Dmoney (Apr 28, 2011)

the-royal-mail said:


> I believe the OP is using our responses to feed his blog content. Hopefully I'm wrong.


How dare he/she...


----------



## Four Pillars (Apr 5, 2009)

the-royal-mail said:


> I believe the OP is using our responses to feed his blog content. Hopefully I'm wrong.


Why do you think that?


----------



## nathan79 (Feb 21, 2011)

Since I began saving four years ago I have saved $33,000 (including the 8K extra payment on the mortgage), so it would take me about 12 years to do.


----------



## Montrealer (Sep 13, 2010)

the-royal-mail said:


> I believe the OP is using our responses to feed his blog content. Hopefully I'm wrong.


Your wrong, I don't blog (at least not yet!)


----------



## atrp2biz (Sep 22, 2010)

donald said:


> Atrp2biz:I take it @ your point your building generation wealth.You are completely in the drivers seat.Do you ever worry if your children will be able to handle it?Do you teach them about money?Do they know the vaule of a dollar?This is none of my business im just curious,im guessing there will be multiple millions passed on.Do they know?


Teaching them about money will certainly be a priority. Right now, our goal is to have him go two weeks without peeing his pants. He's the first of hopefully many, but we hope to instill similar values as us. For us, money is a scorecard and the goal is accumulation.


----------



## Ihatetaxes (May 5, 2010)

atrp2biz said:


> Teaching them about money will certainly be a priority. *Right now, our goal is to have him go two weeks without peeing his pants.* He's the first of hopefully many, but we hope to instill similar values as us. For us, money is a scorecard and the goal is accumulation.


Just think, one day he will say the same about you!!


----------



## loggedout (Dec 30, 2009)

Since I started working "real jobs", it took me about 8 years to save $220k (excluding pension but including my own RRSP). But I was really cheap early on in that saving process, now not so much....Right now, I think I could comfortably save 100k in 3-4 years. I'm single income but have lived with roommates (which includes family, so a bit of a family discount on living expenses).

I only started investing within the latter half of that time period, so far I've invested about 1/3rd of that in financial investments, but have not made much money, if at all, from them.


----------



## steve41 (Apr 18, 2009)

Here's an "average" 32 year-old single with 100K in his RRSP and a 200K mortgage. He earns $70K per year and plans to retire at 60.

Assumptions:
-market rate of return 4%
-inflation 2%
-province BC
-salary indexed at 3%
-full CPP&OAS
-after tax spending (ATI) $40K constant in today's dollars throughout lifetime (pre and post retirement)

I know a lot of you will scream "there is no such thing as average", but you can see the effect of contributions over time.... smallish in early career, large in late career. The reason? the mortgage pmts cease in mid career, and the salary increases at 3% whereas inflation is 2%.

The only constant in the equation is his level of consumption after tax.

If he didn't have a mortgage (rented say) and his salary tracked inflation, then his annual savings rate would be much more consistent.

Joe Average

Note that he has to save additionally to his nonreg very early on... the RRSP max contrib limits dictate it.


----------



## jamesbe (May 8, 2010)

Well although not perfect (I certainly do not see 3% raises, I think only govies ever see that). I like your slightly more realistic 4% per year instead of 7%


----------



## cato (Jul 4, 2011)

Er, in the pc less than 4 months - I'm at the top of my profession, 60+yrs old and in a very specialized field ................. and I work 60+ hours a week. 

A valid question would be "Why am I punishing myself with such a brutal schedule ?" 

I only immigrated to Canada 9 yrs ago - and have had to work doubly as hard as other people to be able to afford to retire here. I suspect that many other immigrants are in a similar situation and may not be able to even think about retiring. CPP, OAS and GIS are just a dream for people like me. 

Be grateful for what you have.


----------



## R.O.V. (May 16, 2010)

My wife and I are both 43 and currently net $8000/mth (combined)...we are (very recently) debt free. We are not super frugal as some on this forum are...we like to indulge ourselves and our kids. We pay ourselves first and save $2000/mth. We will save 100K in the 4 yrs...that is if our situation doest change...i.e sickness, etc.


----------



## smihaila (Apr 6, 2009)

Only 1 income, family of 4 => it would take me approx 3 yrs.
Currently having the money to buy a house with 100% cash, but I don't consider it opportune yet. We're also open and looking at other countries as potentially better relocation targets, so it's better to stay flexible and independent for the moment.


----------



## steve41 (Apr 18, 2009)

Once more, notice our 32 year-old earning 70K with his 200K mortgage, retiring at age 60.

Joe Average

Here is his total saved capital (see page 10) every 5 years.... 101K, 154K, 254K, 416K, 653K, 988K, 1.399K

He can only manage to save 10K per year in his first 5 years, whereas by the time he retires, he is saving 80K per year. This shows how important it is to take a person's full financial situation (including time) into account.


----------



## marina628 (Dec 14, 2010)

The first 100k is always the most difficult to save ,I always found if i kept a graph with my savings goals and how much i had to save each month to get there it did not seem so impossible.My daughter and i were playing with calculators last weekend , she needs 13 years to save $100,000 assuming nothing goes wrong ,she can gross $40,000 a year , have a roommate and live for net $1800 a month.I think that is probably more realistic for Jane Average these days .


----------



## Oilers82 (Jan 17, 2011)

Took me about 16 months to save $175K cash. Used $20K to pay taxes back in April, and I have my 2011 tax money within my cash savings ready for this coming spring. Age 29.


----------



## Montrealer (Sep 13, 2010)

My wife and I are going to start putting away $10,000.00 a year in TFSA's and hope to save up the $100,000.00 cash sooner than later, the reason we want to do this is to:

1) Have cash on hand for investments
2) Save up to potentially purchase a flip property or revenue property with 25% down
3) Make sure there is always at least six figures in an account with a decent interest rate

Also, I feel that once you make your first $100,000.00, the interest alone can be up to $3000.00 a year and that helps saving towards the next $100,000.00 and the next etc.

Thanks for all the replies and feedback guys and girls!


----------

