I built a 6-figure investing portfolio in 7 years: Here's what I do to grow wealth

"My general rule is that I need to understand the investment before I put in any money."

Shaquana Watson-Harkness is the founder of Dollars Makes Cents.
Courtesy Shaquana Watson-Harkness

As a personal finance coach, I work with many clients who save enough money to travel, buy homes, fund their children's education, and pay their bills. But they're often worried that they won't have enough to cover their monthly expenses when the time comes to retire

This is a concern that I can definitely relate to. In my 20s, I didn't think a lot about investing for my future. At the time, my main concern was if I was making enough money to do things like get my first car and apartment, and travel

I viewed retirement as something that I could explore later in life, since I had time on my side. But after cashing out a retirement account to cover my bills when I was laid off, and constantly struggling to budget, I realized as I was approaching 30 that I needed to take investing more seriously if I wanted to save enough to have $1 million or more after I left the workforce. 

I met with a financial advisor in December 2014 and began changing how I approached my portfolio. Investing was a skill that I had to develop over time, but that practice has paid off. I've built a six-figure portfolio in seven years. And I'm steadily working toward accumulating $1 million for my retirement.

Here is what worked for me, and my best advice for anyone trying to do the same.  

I created a budget that helps me invest in myself

I started a debt elimination journey in April 2018 to pay off my six-figure debt. When I put together my budget, I used it to tackle a few key goals at the same time: to track my cash flow, to increase my savings to cover my debt and my monthly expenses, and to consistently pay myself first.  

I paid off $169,000 in 20 months, and today, my budgeting system includes saving at least $800 a month to put towards retirement accounts. 

Every time that I receive any income, including things like bonuses from work, I automatically put a portion of those funds into my retirement accounts. This has allowed my investment accounts to grow significantly, even when the stock market has trended downwards.

Personal finance coach stopped investing in 2020: How she got back on track

Video by Courtney Stith

I slowly increase my contributions over time 

Since 2015, after meeting with my financial advisor, I have automatically set up a 1% increase to my contribution to my employer-sponsored retirement account every year. Doing this has helped me feel more comfortable investing more over time without significantly affecting my take-home pay. 

Also, at the beginning of each year, I review my current contributions to my Roth and traditional IRA accounts and make any adjustments to meet the yearly contribution limit. (For 2021, that's $6,000.)

My goal for 2022 is to max out my IRA contributions and employer sponsored plan, and to start contributing to a SEP IRA account.

I monitor my portfolio and make appropriate adjustments 

Every quarter, I receive statements from my retirement accounts about how much money I made during the past three months. I used to ignore them but now I consistently review them to ensure that my investments have continued to grow.

At the beginning of each year, I look at the statement from the fourth quarter, which shows me the performance of my investments over the last three months, and the entire year. 

Why boring investments are actually better

Video by Courtney Stith

If I see that my investments lost a significant amount of money over the last year, I will decide whether I want to stick with a given investment, decrease my contribution, or invest in another mutual fund that has been performing better in the stock market. 

When making the decision to switch to another mutual fund, I will compare the performance over the last 10 years and look at the types of companies that are included within the mutual fund.

When the market is volatile, I focus on the future

I've learned that when the stock market is down, maintaining your current investments and increasing your contributions with any extra money you're able to spare can help you earn more in the long run. 

Particularly in the spring of 2020, I saw my investments decrease in value amid stock market volatility. But based on my investing experience during the 2008 recession, I felt confident that the market would eventually rebound

Suze Orman: Why volatility can be good for investors

Video by Helen Zhao

I also didn't want to make any early withdrawals from my retirement accounts because I knew from experience I would be penalized for doing so. So I stayed the course and continued to contribute $800/month towards my retirement. 

Once the stock market recovered, the value of my investment portfolio actually increased because I had accumulated more stocks and made a profit. 

I didn't let fear keep me frozen in place 

Investing can be an overwhelming prospect, and this can lead to inaction. But I've found that education is a great way to lessen any fear. My general rule is that I need to understand the investment before I put in any money. 

So I do my research first, whether that is reviewing the investment's performance or consulting with a financial advisor, and then I trust my instincts. 

I do my research first, whether that is reviewing the investment's performance or consulting with a financial advisor, and then I trust my instincts. 

Now, my portfolio is predominantly made up of mutual funds that are invested 80% in stocks and 20% in bonds. They are considered large-cap and growth mutual funds that include companies in the technology, health care, and financial services sectors. 

Ultimately, my best advice is to start investing as soon as possible, with as much as you feel comfortable setting aside. Whether it's contributing a small amount in an employer retirement account or opening up a 401(k) or IRA on your own and slowly increasing your contributions over time, your future self will thank you. 

Shaquana Watson-Harkness is a wealth literacy expert and personal finance contributor who has been featured on Grow, CNBC Make It, KYW News Radio, and Black Enterprise. She is the founder of Dollars Makes Cents and her goal is to help professional millennial women achieve financial independence by shifting their mindset towards wealth building. Stay connected with her on Instagram or Facebook for more personal finance tips and resources.

More from Grow: