I saved 30%-50% of my income and became a millionaire in my 30s: Here's my best advice

Adopt an attitude of gratitude.

Shang is the founder of the blog Save My Cents.
Courtesy Shang of Save My Cents

On the surface, it might seem like I know a lot about how to manage my finances. I earned an undergraduate degree in economics from Harvard and an MBA from the University of Chicago. I was fortunate to graduate from both without debt thanks to a combination of scholarships and parental support. 

After I left school, I worked in high-paying fields like management consulting and technology. Eventually I got to the point where I was able to save around 30% of my annual income. And, in my early 30s, I reached my goal of being work-optional — meaning that I no longer had to hold a job in order to support myself — and I became a millionaire

Despite that strong foundation, I often struggled with my spending and worried about what would happen to my finances if my career plans were derailed or put on hold. Surprisingly, one of the things that made the biggest difference in my approach to money was understanding the power of gratitude. Adopting that mindset was the key to committing to a budget that helped me steadily increase my savings over the last several years.

In 2016, after meeting my savings goals, I launched a blog called Save My Cents to share what I've learned from my experience. 

Here is my best advice about building wealth

Make your 9-to-5 income work for you

My first job out of school was at a consulting firm where I had a five-figure salary. I was fortunate that any bonuses I got I was able to invest, either in my employer-sponsored 401(k), my Roth IRA, or my taxable brokerage account.

While no one taught me directly about investing, I was exposed to investing as a concept through my work, because a part of my job was helping private equity investors learn about new companies they wanted to invest in. And then I started doing more research, reading up on it in my own time. 

At 25, I was earning double the income that I brought in from my first job, and by age 31, I was making three times what I earned out of undergrad. I was able to do this by negotiating for more money, with the exception of one job, each time I changed roles.  

If you are getting ready to negotiate for a higher salary, my best advice is to go in with data about what you are contributing to the company and what your industry pays at your level of expertise and responsibility. Also, if your company has more rigid salary bands, you may still have room to negotiate for nonsalary benefits that protect your work/life balance, like paid time off days. 

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Find a side hustle you enjoy 

For 10 years, I side hustled as a wedding photographer. I started my business right after I graduated from college. Photography had been a hobby of mine since high school, and I figured that people always needed wedding photos. At the height of my business, I did about 20 weddings a year. 

If you are launching a side hustle, my best advice is to build relationships in your industry. Having this support network is so important, especially because those connections were able to help me understand the value I brought to the table.

Other photographers taught me how to create an infrastructure for my business, figure out how much to charge for my services, and close sales. And I improved on my skills every year. 

In the decade I was a wedding photographer, I made about $200,000 in profits and I invested it all, either through my taxable brokerage or a SEP IRA I'd set up for the company. My side hustle earnings and my day job salary both contributed to a solid financial foundation that fueled my path to FIRE (financial independence, retire early). 

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Be intentional about your spending and saving

As my income rose, I learned to track my expenses and live on less than I earned. I challenged myself to save as much as I could and ended up being able to save around 30% of my annual income. But despite having this system in place, I still needed to work on my spending habits.

I enjoyed nice clothes and vacations and dinners out at fancy restaurants. They were all "nice to have" items but never ones I budgeted for. This meant at the end of every year, those spur of the moment purchases significantly ate into my savings rate. 

I figured that since it seemed like I was doing enough to retire "on time" at the age of 65, I didn't have to worry about doing more than saving that 30% each year. I had also adopted the mindset that if I was earning more, I deserved to treat myself. Many of my friends shared this way of thinking. But over time, I started to question if this hands-off approach was really what I wanted and needed. 

Find a partner who is on the same page as you 

When I was 25, a few things happened that started to change my perspective. At that point, I had changed industries and was working at a start-up. Even though my job paid well, I knew that the tech industry could be volatile and I couldn't count on a stable income if I stayed on this path.

Even if I had the means to retire at 65, I also started to wonder if I really wanted that.

I began dating my now-husband, and he shared with me that he was able to save a lot, while earning less than I did, and I wanted to learn more. At the same time, some of my friends began having children, and the question of how having a family could affect a woman's finances and career began to gnaw at me.

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I dreamed of becoming a CEO, but I also dreamed of becoming a parent. What would happen to my earning power if I decided to put my career on pause?

My husband and I often talked about our goals for our finances and careers. Eventually we asked ourselves, what if we could exit the rat race altogether? What if we never had to live in fear of losing income, or of scaling back careers when we became parents? We wanted to have flexibility to become work-optional down the line.

We ran the numbers and realized that it was possible, but in order to do it, we had to learn how to live on the lower of our two incomes, which in turn would allow us to save 50% of our combined income each year.

Adopt an attitude of gratitude

In 2013, we decided to put this 50% saving rate plan into motion. We got married, and I moved from San Francisco to New York City to be with my husband. I took a pay cut at a new job, we managed to find a rent-stabilized apartment, and I began the hard work of trying to maintain my budget. 

I had to find a way to cut about $500 out of my monthly nonrent spending. This meant scaling back on clothes, only taking cabs when absolutely medically necessary, way fewer restaurant outings, and no appetizers, drinks, or desserts on the rare occasions we did dine out. 

If I wanted to go on a trip – travel was one of my top three spending categories before I started budgeting – I could only use credit card or loyalty program points and miles. 

The FOMO soon set in. I went on social media and became jealous of my friends who shared things like lavish vacations and haute cuisine experiences. I felt stressed and unhappy and was starting to resent the plan that we had put in place to give us more freedom. Then, one day, I came across a simple phrase online that started to change my perspective: "I get to."

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I stepped back and realized that I had so much to be grateful for. I had a job and my health, and my basics were covered. It felt a little silly at first, but I started replacing phrases like "I have to go to work" with "I get to go to work," and took the time to acknowledge the privileges I had.

Using this one phrase started leading to other changes in my life. 

I decided to unfollow any social media accounts that made me feel jealous. I invited friends over for potlucks instead of going to expensive restaurants. I learned how to find great used clothing, so that I could still feel fabulous in what I wore. And I continued to work toward my financial objectives with renewed confidence. 

Prioritize your mental health and well-being 

I began to understand that my financial journey wasn't just about the numbers and how much we had in the bank. Hitting those money milestones wouldn't be worth anything if I didn't feel good about my mental health.

During this time, I also went to therapy for two years, and I learned how to better acknowledge and address my psychological and emotional needs instead of trying to suppress them. Doing this work had a big impact on my approach to money. 

I learned to advocate for myself and became a better communicator. I also learned to be kinder to myself. It became easier to stick to my frugal lifestyle and my budget because I didn't feel I had to explain myself to others. I was doing this for me. 

I started replacing phrases like 'I have to go to work' with 'I get to go to work,' and took the time to acknowledge the privileges I had.

Feeling both mentally strong and in control of my money meant that I was able to make financial decisions with conviction. So I continued to invest my savings in low-cost index funds and was careful to avoid lifestyle creep. My feelings of jealousy decreased the more we stayed the course with our plan. 

In 2016, when my husband and I were going over our finances, we realized we had enough saved to become work-optional. It was actually somewhat of an anticlimactic moment. Still, I had learned that what was most valuable was the hard work and the journey, not the destination.

I still have tough days. But remembering all the things that "I get to" do helps me take charge of how I react to my circumstances and puts me in a position to make decisions about my money and my career from a place of joy and abundance.  

Shang teaches Americans how to retire through her Instagram and blog Save My Cents. She lives with her husband, son, and two cats in the heart of New York City. After reaching work-optionality, Shang took a year off, became a new mom, and started working part time. Shang wants everyone to understand that wealth-building is possible if they welcome abundance into their lives.

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