Thursday, October 23, 2008

Saving 80% of your pay can pay off

How far could you get if you scraped back all the luxuries, worked your big ass off, scrimped and save so strongly that people thought you were crazy, and put 80% of your income into a goal?

Perry Goertzen did it. And it got his house paid off in three years:

Most people have trouble saving just 5% or 10% of what they make, but my wife Tiffany and I decided that it was worth living like paupers for a few years if it could give us a huge jump start on life. Saving as much as we did was challenging, but what we accomplished was amazing -- I still can't believe it myself sometimes. When we started, we had a rusty old Toyota Tercel, no house, few possessions and a crushing debt of $37,000. A few years later, we had two almost-new cars and a beautiful new four-bedroom house on a 46-ft lot in Milton, Ont. Everything was completely paid off -- we had zero debt. During this time, neither of us made much more than $60,000 a year at any one job, but by working several jobs and saving almost all of our income, our net worth increased from negative $37,000 to positive $420,000 in less than five years.

The article is up on the Moneysense magazine web site.

The author is clear that he doesn't recommend that anyone else take on the kind of workload he and his lady did. But was it worth it? Absolutely, he says. "Right now, I wouldn't change anything for the world. We're only in our 30s, but in a lot of ways, we're set for life."

1 comment:

  1. Oh.... my... gawd. That is insane. Granted he has more than rectified his finances but holy mother.

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