Have you ever wondered why reaching your first $100,000 is such a big milestone in your financial journey? And, why net worth EXPLODES after $100K? Here I reveal the $100k Golden Rule, how I reached my first $100k and share biblical truths about multiplying money that could change your financial future. Plus, I’ll share my personal 5-step strategy to reach my first $100k. Whether you’re a beginner or looking to accelerate your wealth-building, this article could help you on your way to financial freedom, God’s way.
The $100k Golden Rule: More Relevant Than Ever
The $100k rule gained popularity in the ’90s when the average salary was around $29,000 – about a third of $100k. Today, with median salaries hovering around $60,000, you might think this rule is outdated. However, the principles behind this golden rule remain as powerful as ever.
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Why $100k Makes a Big Difference?
When it comes to investing and building wealth, the first $100k is often considered the magic number. Financial giants like Warren Buffett and Charlie Munger frequently reference this milestone. But why is it so significant? Let’s break down why net worth EXPLODES after $100K from three perspectives: mindset, stock market investing, and real estate.
1. Mindset: The Foundation of Financial Success
Developing the right mindset is crucial for reaching your first $100k. This journey requires discipline, wisdom, and faith. Here’s why mindset matters:
Biblical Stewardship
Understanding that God is the true owner of wealth is fundamental. As Proverbs 21:20 states, “A wise man saves for the future, but a foolish man spends whatever he gets.” This principle of biblical stewardship is key to managing money wisely.
Delayed Gratification
Mastering delayed gratification is essential. In a world of instant satisfaction and social media comparisons, the ability to focus on long-term goals is invaluable.
Financial Literacy
Developing financial literacy helps you make informed decisions. It’s about understanding risk, market fluctuations, and long-term investment strategies.
Unshakable Faith
Building wealth requires faith – not just in your strategies, but in God’s wisdom. As you face life’s storms, being anchored in God’s power and glory will help you become unshakable in your financial journey.
2. Stock Market: The Power of Compound Interest
The stock market offers incredible potential for growing your wealth, especially through the power of compound interest. Here’s a real-life example that changed my perspective:
The Millionaire Lunch
During a lunch with John, an executive at a Fortune 500 company, I learned a powerful lesson. He said, “If you start investing now, at least the amount the company matches, you’ll retire a millionaire.” This simple advice sparked a transformation in my investment strategy.
The Magic of Compound Interest (It’s Why Net Worth EXPLODES After $100K)
Let’s look at some numbers:
- If one invests $1,300 monthly for five years at a 10% interest rate (the average S&P 500 return for the past decade), that could turn into over $100,000.
- Only contributing $78,000, and gaining over $22,000 in interest.
- If we stop contributing after five years and let that $100,000 compound for 25 more years, it could turn in over $1 million.
- Extend that to 35 years, and we’re looking at nearly $3 million.
This is the power of compound interest, which Albert Einstein called the “eighth wonder of the world.” It’s also why the $100k milestone is so crucial – it provides a substantial base for compound growth. And, it helps us understand better why net worth explodes after $100K.
3. Real Estate: Why Net Worth EXPLODES After $100K?
Real estate investing offers unique benefits that can significantly contribute to the wealth-building journey. Here’s why it’s a powerful strategy:
A Basic Human Need
As my stepdad’s brother once said, “We cannot put this money under the mattress. We have to invest in something. And the best place to invest is real estate because it’s a basic human need.” This wisdom has stuck with me throughout my investing journey.
Three Key Benefits of Real Estate Investing
- Appreciation: Property values tend to increase over time, building equity.
- Cash Flow: Rental income can provide a steady stream of passive income.
- Tax Benefits: Depreciation can offset rental income, potentially reducing your tax burden.
Building Trust and Opportunities
When you reach $100k in investments, banks and other financial institutions start to view you differently. They see that you can manage assets responsibly, which often leads to better terms and more opportunities. As Luke 16:11-12 says, “If you have not been trustworthy in handling worldly wealth, who will trust you with true riches?”
5-Steps That Helped Me Reach My First $100k
Want to learn my full journey...I have a good one, click here if you want to check it out.
Now that we understand why the $100k milestone is so important, let’s look the five practical steps I took to reach the first $100k goal and hopefully this can help you too:
1. Invest in Myself
The most important investment you can make is in yourself. This includes:
- Pursuing education (I worked as a server to pay for my degree)
- Hiring coaches or mentors (I paid for real estate investing mentorship)
- Seeking wisdom from others
As Proverbs 12:15 reminds us, “The way of a fool is right in his own eyes, but he who heeds counsel is wise.”
2. Automate Investments
After my lunch with John, I set up an automatic transaction to invest 20% of every paycheck. Automation removes the temptation to spend and ensures consistent investing.
3. Diversify Investments
The Bible encourages diversification. Ecclesiastes 11:2 says, “Divide your portion to seven, or even to eight, for you do not know what misfortune may occur on earth.” This principle led me to explore real estate investing alongside my stock market investments.
4. Live On Less
Practicing prudence and avoiding lifestyle inflation is crucial. When I was approved for a $360,000 home loan, I chose to buy a $165,000 home instead, allowing me to invest more.
5. Give Generously
I gave when things were not going well and when they were. And, I chose to give a percentage of the gross income. Giving is a fundamental principle of biblical finance. As you build wealth, remember to honor God with your finances and use your resources to bless others. This alone, God’s favor, can be why net worth explodes after $100K.
Building Unshakable Wealth: The Journey Beyond $100k
Remember, reaching $100,000 is more than a financial milestone—it’s a transformative journey of discipline, wisdom, and faith. By anchoring your approach in biblical principles, you can build wealth that glorifies God and withstands life’s storms. As you implement these strategies, keep in mind Proverbs 21:21: “Whoever pursues righteousness and kindness will find life, righteousness, and honor.” Your financial journey is not just about accumulating wealth, but about growing in wisdom and using your resources to make a positive impact.
If you want to learn these steps in even more details, then I highly recommend my Wall Street Journal best selling book ‘Destined for Wealth.’ You can get it on my website, for a better price, when you click here. Or you can grab it on Amazon here.
There’s also a destined for wealth planner that comes with it to anchor these principles even further and make it more tangible and actionable.
And if you want to learn how to get smart with money and manage it according to God’s principles, I highly recommend you go watch this video.
