Boston Gal's Open Wallet

Fabulous!

 

Yet another millionaire in the making where the person's housing portion of their total portfolio is way of whack.

95+36+8 = 139K, which isn't impressive for someone at age 36.

In addition, from a different part of the same website, the average salary at Booz Hamilton for an "associate" pays $100,800 (http://money.cnn.com/magazines/fortune/bestcompanies/2007/snapshots/63.html)
In this article, it says she is a "senior consultant in project management", which sounds like it pays more than just an associate.

No wonder she can afford the tiny payments on a 114K mortgage and pay it off early.

While I applaud Sherelle for turning things around, I think CNN does a disservice to its readers by not giving us the entire picture, not revealing salaries and highlighting people who either hit it big in real estate or make a lot of money.

 

... the soft bigotry of low expectations?

 

Ronaldo,

That's $108K average for the whole company. But you have to consider that BAH is primarily a government contractor and so they are paying out the wazoo for people with security clearances, even at the lowest levels. If you don't have one, you can easily make $20K less than your peers who do.

I'm not sure that "Senior Consultant" actually means anything other than she's been around doing this job for a while. If you notice at the BAH website, there is no job called 'Senior Consultant'. The closest thing I could find was Project Manager and no salary listed. There's a lot of meaningless titles floating around DC.

I wouldn't knock her down. Being a single mom in a consulting business can be hard. She can't take the plum travel jobs and that can hurt you at a consulting firm like BAH.

I think she's doing great! I don't think I'll have 139K when I'm 36 and I certainly don't think I'll have my home paid off in 10 years. Around DC and specifically where she lives, it's expensive. The thing that's making her wealthy is her self discipline not to overspend. If I ate a turkey sandwich every day for lunch, I'd have a lot more to save too.

If you read the whole series, they do profile people who aren't making 6-figures.

 

Considering Sherelle is a divorced single parent, I give her props for her financial discipline. Divorce is often a financial disaster for both parties, so kudos to her for building up a nice safety net.

Personally, I'm uncomfortable about her Lexus 460 purchase. She has $139K in assets excluding her primary home. The Lexus will set her back over $70K, that is a huge chunk of her net worth. I own a $70K Mercedes E-500 myself, but did not feel comfortable buying it until I exceeded $2M in assets.

 

I agree with Renaldo. I was not impressed by this person's finanicla position. She should have much more finanical assets if she's on the road to the millionaire club.

 

It is a pretty inspiring story. I think Ronaldo is onto something about not getting the entire picture. I remember the "millionaire" series used to have a separate box listing asset and liability info and pretty much outlining where the subject stood (as Ronoldo pointed out, usually lots of real estate). I guess people were nervous about exposing themselves like that so CNN quit doing that long ago.

I think my favorite "millionare" was the teacher in LA who made 60K a year and whose net worth wasn't jacked up by home equity.

 

Wow, OK - those are some interesting comments. She is my favorite so far because her Net Worth has been built primarily on her own(her divorce happened when her baby was very young and it sounds like child support came later rather than sooner).

I am 35 - soon to be 36. So she is the closest profile to myself, and is doing better than I am and I don't have a child to support! If I have low expectations for her - what does that say about me?!

I agree that I miss the old sidebar box with all the juicy details about income and assets and liabilities - but can understand why people are uncomfortable revealing that info.

What I really wish they would do is revisit the Millionaire in the Making subjects and chart their progress. I think the series has been around long enough that they could now do a 5 year check-in - that would be really interesting!

 

A Project Manager and a Senior Associate are 2 entirely different positions. The payscale is different. Although if you want to know her rough salary, it's about $95k. The article states she puts 20% of her salary to her 401k and IRA. Since the max you can put in a 401k is $15k and in an IRA 4k, that's 19k total. 20% is 1/5 of 100% so multiply 19k by 5 and 95k is her salary.

Reading these CNN articles and stalking Boston Gal's blog for quite some time now is extremely interesting. I have been thinking of making a blog to help out others with finances, but I don't have enough time to constantly update it. I contemplated with the thought of submitting a financial piece for Boston Gal to post/discuss.

I am 25 years old, live in the Boston area and my net worth is above a million now. There was an old front page news story about how I did it here:

http://www.tnhonline.com/media/paper674/news/2004/04/16/News/Student.Entrepreneurs.Master.The.Internet.Market-662699.shtml

My strategy now has change from generating income to putting my existing money into hyper-growth mode. Publicly, I don't speak about my personal wealth to often. A young person with wealth breeds a lot of animosity and jealousy, but I believe I have a lot of unique knowledge in finance that could benefit people.

 

i don't understand why some people are so afraid of credit cards. if one has the discipline to eat turkey sandwiches every day, or to only use a landline for phone calls, wouldn't one be able to NOT use a credit card for that for which they cannot pay, and get miles, points, or $$ back for using it responsibly?

 

I was inspired by the story. I am also a single mom and to see how much she has overcome is very inspiring. Reading these comments saddens me. No matter how much progress people make in their lives, to some it still isn't enough. So what if her networth includes home equity. And so what if she chose to splurge on her Lexus. Is she not entitled to anything after eating homemade sandwiches everyday. Everyone's success shouldn't be measured by other people's rulers. I think she is successful based upon her discipline and the personal circumstances she has had to overcome.

 

Great story! I'm the same age as Sherelle and I'm no where near where she is..yet Both Sherelle and you BG are are an inspiration to keep doing better!

 

"Derico has no credit cards and pays for everything in cash with the exception of her Lexus"

Paying cash for everything, is a good step to not being in debt.

 

I can see both sides of things here. She's definitely a good saver. However, "The value of the property has soared in Fairfax County's overheated real estate market. Similar homes in the area sell for $500,000-$600,000.

Derico has racked up $460,000 in equity in the town home."

If you can take a $114,000 home and make it worth 500-600K 8 years, we'll yeah, you are going to on your way to a million.

Without that extremely fortunate circumstance would she be a millionaire in the making?

It's a little disappointing that when I read this, I can't get a lot of duplicatable advice. I learn to be frugal, but it seems like that's maybe 25% the key and 75% is to get lucky in the real estate game.

 

I have to agree with many of the posters here: anyone who finances a 70k luxury car has no place in a financial success story. I'd like to see a follow up story in 5 years. See how much she manages to save once her house is not doing the work for her.

 

I'm with Jon. There are plenty of fine cars for 1/3rd to 1/2 the cost of the Lexus. Additionally the insurance and maintenance add to the true costs of the car. There's a lot more she could be doing with the money. That said, I applaud her for instilling in her daughter the habit of saving and committing to charitable donations.

 

People are slamming her for financing the car, but she admits that it was a foolish thing to do. Every once in a while you have to indulge yourself. Better a resaleable car than all those lovely restaurant meals I eat.

Let her be. She's bucking a demographic trend as a single mom.

 

This is a tough audience. By the way, I believe in BAH, the job title hierarchy is Consultant -> Associate -> Partner. If average Associate pay is $105K, then she's making less as Sr. Consultant. Also, government contract pay is lower than commercial contract pay.

I think what people are missing is that she's amassed this wealth in a relatively short period of time. She was in a bit of trouble when 9/11 happened. So in probably less than 5 years, she's turned everything around. Not bad at all, if you ask me. I don't need the next 5 years to see how well she'll do.... I already know from her past 5 years.

Also, I don't know why everyone is so down on real estate wealth. Wealth is wealth. If she relocates to lower cost place (like Dallas, Atlanta, etc), she will be extremely well off since housing is probably 1/3 - 1/2 of what it is in DC/Virginia. It may not be repeatable for everyone, but what jackpot is? If I gave you a hot stock tip, I wouldn't expect everyone in the world to benefit from it? Just a select few; but you wouldn't slam the select few that made money.

I live in the same area that she's in, and believe me, it is expensive and she's done well.

 

Yes, but that real estate wealth only has value if you move completely out of town. My parents are sitting on $600K in equity in Fairfax County. But, since all the smaller homes around them have increased in value too, they'll only realize 200K max of that amount. If you really care about where you live - esp. if you have kids in school - are you really going to leave your community/job/friends/family to capitalize upon that real estate wealth?

Your *second* property is an investment. The one you live in is your home.

 

Also, I don't know why everyone is so down on real estate wealth.

I agree this is really tough crowd. I can see some reasons to be down on real estate wealth, but it doesn't seem like she intentionally skewed her net worth -- she managed to accumulate $130k in addition to the home equity.

People can't prevent rapid rises in their home's value, but that doesn't necessarily mean they deserve derision for a misbalanced portfolio.

 

There's nothing wrong with splurging on a Lexus. I should have said I would have been uncomfortable myself with such a purchase, given the same assets. It's totally a personal choice.

I don't think material possessions are important. Before the Mercedes, I owned a second-hand Honda Accord for many years. My next car will be a Toyota Prius. I'd rather use the bulk of my wealth for purposes other than buying stuff. But it's totally a personal choice.

 

Quick response on ronaldo's and lazymanandmoney's posts. I think it's pretty obvious how to become a millionaire. Those millionaire in the making stories highlight real estate wealth or big salaries because those are two main roads to wealth. You can attain wealth through 1) owning/building your own business 2) investing small money in stocks for your entire lifetime 3) investing big money in stocks/businesses 4) real estate investments 5) big salary and/or stock options. I can't think of anything else that doesn't involve inheritance or winning the lottery. Odds are if someone has a low salary and wants to become a millionaire by working for someone else, they have to study or work to improve their salary and benefits, or invest a little money over a lifetime.

I really don't think being frugal is going to get you there, unless you're willing to wait a lifetime for those savings to accrue. Time is more important than money. The time you spend saving a few dollars is time you might be wasting to make bigger money (sometimes saving money doesn't take extra time, and I take advantage of those few opportunities). Yup, I know people who spend an afternoon comparison shopping to save $5 on a DVD - that time could have been better used. I believe saving a few dollars here and there can make you a million dollars over a lifetime, if you're patient and disciplined enough to wait that long, and willing to sacrifice all those decades.