A New Millionaires in the Making is Up at CNNMoney.com

I wish they had these more often, they're always an interesting read.  It's also something of a measuring stick.  It's fun to see how other people are doing, and see how I stack up.  Most of the people profiled are doing rather well, otherwise they would not have sent their story to cnnmoney.com.  This young couple is doing very well.

This edition profiled Matt and Lori Marchbanks of Dallas, Texas.  They are high school sweethearts who went to college together and got married two weeks after graduation.  He works in Real Estate and she works in Accounting.  Today they are 28 and 27 respectively, no kids, and the biggest fact that jumps out at you?  Their income.  They make a combined $185,000 per year.

The Marchbanks are certainly the prototypical couple that CNNMoney is looking for.  Young, high level of savings, clearly millionaires in the making.  Somehow, this one was kind of boring to me.  Maybe it was their high income.  Maybe it was the "we're not penny pinchers" mentality.

Their goals are much like many of the personal finance bloggers we read every day, "we can afford a lot more, but we choose to pay ourselves first," Matt says. "When we're 55, we want to be the ones to decide if we continue working, or take part-time jobs or just travel. Nothing beats saving when you're young so you can get ahead with the power of compound interest."

True, true.  Exactly what I tell young people.

"They pay off credit cards every month, so their only debt is their mortgage"

Also very wise.

"Beyond that, they don't really operate with a strict budget - more like strict values."

True, it all starts with shared values.  Budgets can be difficult to stick to, values are much more enduring.

So, why did this one bore me?

Well, it could be the high income.  According to the Millionaire Next Door Wealth Formula, which I found on JLP's site, they are not good savers.  Of course, that's silly.  $300,000 at 28 years old?  That's good savings.  The formula is Income times Age, divided by Ten.  So, (Income x Age)/10.  With the Marchbanks' income of $185k, and their average age of 27.5, they should have a net worth of $508,750.  Admittedly, I'm also "underwealthy" by that formula.  I'm not so sure how much I buy the validity of the formula, because I have always believed that wealth is a function of how much you have versus how much you spend, not how much you make.  Maybe I'll write my own formula.

I suppose it may be the squeaky clean image.  The photo that says, "Hello from Maui!" The high school sweethearts who went to college together.  Matt's golf indulgence.

Maybe I'm just in a sour mood and being extra critical.  Anyway, go read it.  And if you haven't kept up with the series print them all out and read it sometime this weekend.  A few of them are pretty inspirational.

Comments

[financial freedumb]

Somehow that formula seems like it's got one big flaw...it should be (average income during period of working years) * age / 10.

This would give a more accurate, achievable estimate.

If you make tons of money at the end of your career, you're numbers will be overinflated. If you make less money at the end of your career, you'll look like you're doing really well...

[lamoneyguy]

That's exactly what I was thinking, the average income over some number of years part. I think it should be a fairly large number of years, like 10. That way a 26 yr old engineer making 65k also factors in the low or no income of the recent college years.

[mapgirl]

Wow. What a boring couple.

No doubt they are well on their way to being millionaires, but I wasn't really impressed with their work. I could easily see both of them being laid off in a harsh economic downturn. But they'll have a lot of savings to live off of during that time.

I guess I like the articles about couples that are a bit more entrepreneurial in spirit.

[braouni yacine]

hi

[Medicated Money]

I agree with you on the boring aspect of this couple. For me, I enjoy reading the 'we were on the ropes, and realized we needed to change' stories. In order not to sound like a jealous, green-eyed monster, I must admit that this couple is doing an excellent job!

Yet, the key to the story is told in one line, "Our parents paid for college so we didn't start with any debt." This is the main reason this couple is doing so well! I would have enjoyed reading about their parents and how they saved to pay for their children education then the kids who reaped the rewards and now know that they should put money into a bank account instead of a latte!

-Medicated

[Charles]

Since I'm reading that book right now, I'd point out that they really only seem to apply their formula to people 40+ and generally 50+ in age. For us in the <30 age-group, we haven't had much time for compound interest to do its job.

[soy yo]

yo no jugar con ustedes tienes una terjeta roja

[john morgan]

It's not about how much you make, it's about how you spend what you make. Take advantage of Roth IRA's and mutual funds while you are young. I started investing with help two weeks after turning 21. I'm glad I started that young. All I have is a High School diploma and im well on my way to being a millionaire. I figure another 7 years. Im only 27 now!

[PT from Prime Time Money]

Some of the people they profile actually are young. I compiled the entire list and will soon publish the stats of the millionaires in the making. For now, here's the entire list of profiles.

http://ptmoney.blogspot.com/2007/12/complete-list-of-cnn-moneys.html

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[Queensridge Las Vegas]

Its good to see all these youngsters making it big in the market, the young couple certainly are inspiring. At present FB owner must be the youngest millionaire.