Do you remember your first time on an airplane?
I still remember my first flight.
My family was headed from Texas to Phoenix for a family reunion. Good vibes, good times, and this 8 year old’s very first airplane trip.
What struck me the most about my first flight? The violence. Or should I say, the violence of that first 20 seconds.
Anyone who’s ever flown on a plane knows the drill, but to this young first-time flyer, it was quite the surprise.
The pilots hammer down the afterburners with a roar loud enough to make the cabin shake. You’re pinned to the back of the seat with g-force that’d make an astronaut squirm. The whole cabin begins ratting and shaking as the airplane struggles to move, then begins picking up more and more speed.
50 mph, 70 mph, 100 mph.
Cabin’s really shaking now. This is the part where the first time flyers have long since closed their eyes, said a prayer, and are fumbling around against the seat-back in hopes of feeling for the puke bag.
110 mph. 120 mph.
The wheels start to bounce on the runway. The plane sways back and forth. Surely it’s going to explode now?
140 mph. 150 mph.
The wheels start to lift. And then… nothing. The chaos suddenly stops and gives way to weightlessness. Silence. Smooth sailing. Liftoff.
Yeah, building wealth is kind of like that…
The First $100,000 is a total grind.
When you start the wealth building game, the mountain looks insurmountable.
You see these personal finance bloggers talking about $500K portfolios. Whoop-de-doo, for them. You’re just looking for $1-2K to get started.
But you start saving anyway, and… It’s even harder than you imagined.
The plane is barely moving.
You keep clawing and scraping. Progress feels like it’s taking forever, and it is.
In fact, even if you’re saving $10K a year and earning average market returns, mathematically that first $100K will probably take you 7-8 years.
But guess what?
After investing $100,000, those afterburners are hammered down.
It’s still a bumpy ride, as anyone who’s ever watched my net worth updates knows. You’re still pinned against the back of your seat and the cabin’s shaking, but that initial $100k of momentum allows you to start building speed.
Zach from FourPillarFreedom.com has an awesome chart showing this:
As the chart shows, mathematically, even if you save the same amount and earn the same returns, you’ll save your second $100,000 about 35% faster than your first $100,000.
But that’s just the beginning. Eventually, your investments get the “all clear” and you’re ready for exponential growth.
By the time you’re near liftoff, your savings will grow from $600K to $1 million faster than it took you to save your first $100,000.
Compound interest is the weightless part of liftoff.
Why do your savings speed up so exponentially?
Well, it’s really just the mathematical law of exponential growth in action. But since our human brains aren’t designed to understand exponential growth, I find it more relatable to attribute this warp-speed growth of your portfolio to that magical moment when your investments turn into money printing machines.
Your money starts earning more money, and you reach a point when even just normal investment returns are actually double, triple, or quadruple your entire initial investment.
- A 7% return when you’re only $50,000 into your savings journey is a mere $3,500… not much to get excited about.
- A 7% return on a $1 million portfolio? That’s $70,000 – more than most people make in a year!
In any case, just like a busy airport, most every takeoff is the same. A slow, frightening start, followed by a weightless liftoff that propels you to wealth.
This pattern happens on every single plane flight. So much so that once you’ve got a few flights under your belt (or in our analogy, a few thousand under your belt) the anxiety goes away.
You stop seeing each takeoff as some sort of death defying feat and instead see it for what it truly is – business as usual, transporting you to the wealth of your dreams.
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