How a Software Developer Who’s Also Developing His Net Worth Does Money

Photo credit: Mike, CC BY 2.0.

Jay Sun is a 28-year-old software developer in Atlanta, Georgia.

So, Jay, how much are you making?

So, I don’t want to disclose my current salary, but I am willing to disclose my last job’s salary plus a range that my current salary is within (due to concern about corporate guidelines). Is that okay?


Okay, my previous position had a salary of $105K.

My current position is within a 10 percent band of that.

How does that income compare to your expenses? What are you spending money on? What are you saving?

Let me pull up my Mint account real quick..

All right. According to Mint, 33 percent of my spending is on housing (mortgage+HOA+miscellaneous housing expenses).

Another 18 percent is on transportation, which is auto payments, insurance, gas, and repairs.

17 percent is food, no distinction made between eating out or cooking/dining in.

19 percent on entertainment and shopping.

7 percent on bills and utilities.

And 6 percent on miscellaneous.

For the previous month, I made about $5,400 after taxes, savings, and payroll deductions.

This is the first year that I’ll max out my 401(k), but I’ve contributed the max to my Roth IRA since I’ve started working.

What percentage of your income is going towards savings and retirement, then?

Retirement, which includes my HSA contributions (I pay for my medical expenses out of pocket and plan on using the HSA like a regular retirement account when I’m old), is approximately 23 percent of my income.

Principal payments (car, mortgage) is another 12 percent of my income.

So roughly 35 percent of my income goes towards increasing my net worth in any given month.

I love that way of looking at it!

Have you in fact been successful in increasing your net worth? Or has something come up to get in the way?

I have, actually.

The first few years out of college, the vast majority of the increase in my net worth occurred by the rapid appreciation of my condo, which I bought as a foreclosure soon after graduating.

That was made possible by not having any debt (thanks, mom and dad!) and the FHA’s First Time Buyer program, so I only needed to put 3.5 percent down.

The past few years, most of the increase in my net worth has happened by me ramping up my debt payments and increasing contribution to my retirement accounts.

Do you have a goal for your net worth, like early retirement?

My goal is to continue working into my 50s, and then depending on market conditions, the economy, and my own professional viability (it’s a lot harder to get rehired past the age of 50, especially in software development), I may or may not continue working into my 60s.

I don’t really have a specific goal for net worth. Ideally, I’d be close to 8 figures by the time I’m ready to retire, but that’s thirty years from now.

So what do you think you do really well, financially, and what do you wish you could do better?

I think I’m really good at staying disciplined and keeping abreast of financial news. I subscribe to the idea of efficient markets, which basically means to buy stocks as soon as you can and never sell them, regardless of what happens.

My dad really hammered home the point to me when I first started investing in 2007. Our family’s finances had been burned by the dot com bubble in the early 2000s and he sat me down and told me “everybody’s happy when times are good, but when the market crashes and your portfolio is down, 50, 60, 70 percent, you’ll know what kind of investor you are.”

One year later, the financial crisis hit and my highflying portfolio was indeed down 70 percent at its trough.

But I never sold and two years later, I recovered everything that I lost. That lesson really stuck with me, and I’m glad I was able to learn that lesson when my portfolio was much smaller than it is now.

In terms of what I’d like to do better, really, I think I’ve got a pretty good handle on financial matters. Any improvement would be marginal. Other parts of my life are a different story.

Fair enough! So let’s go back to your dad’s advice, since you’ve mentioned your parents twice now. Did they provide the bulk of your financial education?

Not really. I learned almost all of it on my own.

I actually got the idea to start investing from a coworker from a temp job I had in the summer. I told him (a married middle-aged dude) I was gonna buy a paintball gun with my first paycheck and he suggested investing it instead.

Something about his message stuck with me and I just started reading as much as I could on finance.

But I do owe my financial habits to my parents. They were very frugal with money. I’m not as frugal, but the basic principle, to save a substantial portion of your income, definitely stuck.

Two questions then:

  1. Did you ever get your paintball gun?
  2. Can you estimate the return you got on that initial investment?

I did, but it wasn’t a top of the line model that I wanted. I compromised and got something way cheaper.

In terms of pure ROI, that initial $4K that I earned from my summer job is probably worth around $15K now. But the financial education it provided was invaluable.

What advice do you have for someone who wants to start investing?

There is no silver bullet to doing anything.

If you want to become knowledgeable at finance, you need to read a ton. If you want to amass a lot of money through investing, you need to invest a lot of money.

One of the key factors that isn’t always mentioned, to be sure!

Exactly. Too many personal finance “gurus” try to make it seem effortless and easy. It’s anything but.

Are there any books you’d recommend?

For a “this is what you’re supposed to do” book, two books were crucial to me.

A Random Walk Down Wall Street: The Time-Tested Strategy for Successful Investing, by Burton Malkiel. It’s the Bible of efficient market theory, and it’s been in publication for decades.

The other book is The Little Blue Book That Still Beats the Market, by Joel Greenblatt. It does a great job at breaking down what stock ownership really means, and it also advocates a strategy that I don’t follow, but it’s a good, entertaining read that gives you actionable advice.

If you’re interested in the history of money and finance, Niall Ferguson’s The Ascent of Money: A Financial History of the World is really interesting and well researched.

Excellent, thank you!

Last question then: aside from investment advice, what other financial advice do you have for Billfold readers?


You already know what you’re supposed to do. The hard part is actually doing it. So find a way to do it.

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