How to Go From $0 to $100k Net Worth in 1 Year or Less (in Tech) : Chris

How to Go From $0 to $100k Net Worth in 1 Year or Less (in Tech)
by: Chris
blow post content copied from  Be on the Right Side of Change
click here to view original post

5/5 - (1 vote)

Billionaire investor Charlie Munger is famously quoted as saying, “The first $100,000 is a bitch, but you gotta do it. I don’t care what you have to do – if it means walking and not eating anything that wasn’t purchased with a coupon, find a way to get your hands on $100,000”.

For most people, saving $100k in a single year is tough. In the following table, I have compiled a list of job descriptions of how long it would take them to save $100,000, assuming a 10% and a 50% savings rate:

Profession Avg Income (USD) Years to $100k (10% Savings Rate) Years to $100k (50% Savings Rate)
Software Engineer $105,000 9.52 1.90
Data Scientist $120,000 8.33 1.67
IT Manager $135,000 7.41 1.48
Systems Administrator $80,000 12.5 2.5
Civil Engineer $87,000 11.49 2.30

Even though it takes 5-10 years of study, hard work, and possibly, a student loan to join each profession, it takes roughly another 10 years to save up $100,000 with a 10% savings rate.

Not impressive.

Even if you live frugally and save up half of your annual salary, you’d need two years, so it wouldn’t make our challenge of achieving $100k of net worth in a single year.

This brings us to the first answer to our challenge of saving up $100k in a single year. It’s not the best option, my favorite is Way 3 (keep reading), but it is possible with brute force…

Way 1: A Single High-Paying Job

High-level tech positions earn $200k or more annually, especially when considering total compensation (base salary, bonuses, stock options, etc.).

Here’s a list of 10 tech job descriptions where it is possible to make $200k or more, depending on the company, location, and nuances of the job role:

  1. Machine Learning Engineer: Specializes in designing and implementing machine learning applications. They utilize data modeling and evaluation strategy to create and deploy ML models.
  2. Data Engineering Manager: Leads the team responsible for building and maintaining the architecture (like databases and large-scale processing systems), pipelines, and data sets used by data scientists and analysts.
  3. Site Reliability Engineer (SRE): Combines software and systems engineering to build and run large-scale, distributed, fault-tolerant systems.
  4. Cloud Solutions Architect: Designs multi-platform solutions that interface with cloud services like AWS, Google Cloud, or Azure.
  5. Blockchain Developer: Specializes in developing and implementing blockchain solutions and smart contracts.
  6. AI Research Scientist: Focuses on advanced computational techniques and methods to improve or develop new AI algorithms.
  7. Prompt Engineer: Expert in designing and implementing models like GPT-3 or GPT-4, ensuring they cater to specific user needs while maintaining efficiency and effectiveness.
  8. DevOps Director: Leads the engineering team that builds and maintains the infrastructure, ensuring smooth CI/CD processes, scalability, and system reliability.
  9. Cybersecurity Director: Heads the strategy and implementation of cybersecurity measures across the organization, ensuring data protection and compliance with regulations.
  10. Chief Technology Officer (CTO): The senior-most tech role in most organizations. Responsible for the technological direction of the company, including setting tech strategy, making high-level decisions, and managing tech teams.

Here’s the same table as before, but for those roles:

Profession Income (USD) Years (10% Savings Rate) Years (50% Savings Rate)
Machine Learning Engineer $220,000 4.55 0.91
Data Engineering Manager $230,000 4.35 0.87
Site Reliability Engineer (SRE) $210,000 4.76 0.95
Cloud Solutions Architect $225,000 4.44 0.89
Blockchain Developer $240,000 4.17 0.83
AI Research Scientist $250,000 4.00 0.80
Prompt Engineer $235,000 4.26 0.85
DevOps Director $245,000 4.08 0.82
Cybersecurity Director $260,000 3.85 0.77
Chief Technology Officer (CTO) $280,000 3.57 0.71

All those high earners will go from $0 to $100,000 net worth in a single year when assuming a 50% savings rate which is easily possible given the high income levels.

The best bet you have is to start in a fresh industry where few people have industry experience or even academic degrees because the industry is extremely young such as blockchain development, Bitcoin, and prompt engineering.

Yet it’s really tough to even get those jobs. In fact, seeking a single job is not the best vehicle to attack this challenge, in my opinion.

Way 2: A Chill Job with Side Income Freelancing

A much better second way, in my opinion, is to seek a chill job that pays for your living expenses (or find a spouse who does it) and that gives you some daily space and time to work on your side income business as a freelancer or consultant.

If the job is not too stressful, you can work on your side income daily. There are many such jobs. In fact, I’d say most normal jobs are like this. I personally know many German employees working for large automobile companies (e.g., Bosch, Daimler) that offer a cool 30h work-week that gives you more than enough time and space.

Let’s assume you can work 1 hour in the morning before going to your chill job and 2 hours in the evening instead of watching Netflix (between 7:30 p.m. and 9:30 p.m. so you can go to bed early). Let’s be aggressive and assume your chill job gives you one additional hour to work on your business during job time (or during a 2h “lunch” break in front of your screen).

With such a chiller job, you can easily add 4 hours per day, including Saturday and Sunday, without getting too exhausted.

Remember, our challenge only lasts one year!

Per year, you can work an additional 1460 hours in your side-income freelancing business. As your main job (or spouse) pays for the lifestyle, you can save all proceeds of this freelancing business.

To save $100,000 in a single year this way, you’d have to average $69 per hour after tax in your freelancing business:

With a bit of hustle, this is not unlikely, even during the first year. Many have done it before you. Making $69 per hour as a freelancer is just slightly above average, depending on which sources you check out:

But we are not striving for average anyway; the top one-third is good enough for our purposes. At the very least, making $69 per hour as a freelance developer is much more likely than getting a $200k per year job without prior experience.

💡 Resources: How to accomplish this is beyond the scope of this article. You can check out our freelance developer course on the Finxter Academy to learn how to approach your own 1-person freelancing coding startup, starting from zero.

Way 3: Creating a Small Saleable Business System

Now here’s to my preferred way to address this challenge without spending 12 hours per day working: create a saleable business system.

💡 A saleable business system is often valued at a multiple of the monthly profit. Many web businesses such as software as a service (SaaS), dropshipping, Amazon FBA, advertising businesses, or Kindle ebook stores are often valued at a 48x monthly multiple. So to get to a $100,000 net worth, you only need to create a saleable business system with a $2,200 monthly profit.

How would you sell it? There are many online brokers you could list your business system, such as this one:

Where could you get ideas for such a software-as-a-service (SaaS) business? Check out our Finxter article here:

💡 Recommended: 10 OpenAI SaaS Ideas to Scale a One-Person AI Company

Also, feel free to consider joining the Finxter Academy with dozens of high-value practical exponential tech courses on AI, blockchain dev, and coding, such as this one on prompt engineering:

Prompt Engineering with Python and OpenAI

You can check out the whole course on OpenAI Prompt Engineering using Python on the Finxter academy. We cover topics such as:

  • Embeddings
  • Semantic search
  • Web scraping
  • Query embeddings
  • Movie recommendation
  • Sentiment analysis

👨‍💻 Academy: Prompt Engineering with Python and OpenAI

The post How to Go From $0 to $100k Net Worth in 1 Year or Less (in Tech) appeared first on Be on the Right Side of Change.

September 18, 2023 at 04:31PM
Click here for more details...

The original post is available in Be on the Right Side of Change by Chris
this post has been published as it is through automation. Automation script brings all the top bloggers post under a single umbrella.
The purpose of this blog, Follow the top Salesforce bloggers and collect all blogs in a single place through automation.