Welcome to another edition of WealthFam’s Wealth Diaries. This series explores the financial values and wealth of real people.
Think you would be a good person to be featured in our Wealth Diaries series? Email us and tell us why at hello at wealthfam.com. All submissions are kept confidential.
Meet “Ryan” from Chicago
Occupation: Business Analyst
Location: Chicago, IL
Relationship Status | Kids?: Single with no kids
Housing Status: Rent with no roomates
Education: College grad
Ryan’s Financial Summary
Salary: $74,000 annual
Paycheck Amount: $2,150 (2x/month)
Monthly Expenses: $2,100
Net Worth: $27,000
Estimated Net Worth Needed for Financial Independence : $756,000*
*Assumes requirement of 30x annual expenditures for financial independence. This is a fairly common and conservative rule of thumb when it comes to financial independence. Note if annual expenses change, the net worth requirement also changes.
Q&A with Ryan
What do you do for a career?
I work for a well-known company as a business analyst. Basically I spent a lot time looking at data in Excel. And going to meetings. Lots of meetings. Overall I like it as my co-workers are cool and the work can be challenging.
What financial goals do you have?
Saving more money is my biggest immediate goal. My salary is decent but rent, eating out, and travel pretty much leaves me with nothing left over.
Longer term I hope to settle down and have a family so I want to be in good financial shape for that. I’ve seen my parents go through layoffs and how hard that has been so would like some financial security.
On a scale of 1 to 10 how would you rate your financial health? Why?
5. I feel really lucky not to have any student loans but at the same time I haven’t saved all that much. So I guess I’m somewhere in the middle. Not bad but not great either. I need to find a way to save more money.
Biggest financial accomplishment?
Maxing out my 401k.
Biggest financial fail?
Expensive apartment. I have a good job and work hard so I want to come home to a place I feel really good about. But downside is so much of my paycheck goes to rent which sucks. In hindsight I probably should have found a cheaper place.
Best financial advice you’ve received?
Pay off your credit card in full every month.
WealthFam’s Two Cents:
The good: Ryan is young and is debt free. Although he hasn’t accumulated a ton of assets he also hasn’t accumulated any debt. He has a good paying job and lots of income earning years left.
The bad: Nothing terrible but we agree there is an opportunity to save and invest to grow Ryan’s net worth in support of his goals.
Ideas for the future: Keep working hard with goal of growing income via promotions. Cut or hold living expenses by moving to a more humble apartment or getting a roommate.
Think you would be a good person to be featured in our Money Journals series? Email us and tell us why at hello at wealthfam.com. All submissions are kept confidential.