How One Couple Climbed Out Of Debt And Became Millionaires In Their 30s

An inspiring story about how a couple got themselves out of debt and grew their net worth!
It was right after college graduation when starting a new life became very expensive for this newly engaged Canadian couple..

Pretty soon the debt was an unsettling reality:

$25,000 for the car loan (honda civic)

$100,000+ mortgage

$45,000 in outstanding student loan debt.

Out of college, the couple had a combined income of $85,000 per year (he’s an engineer, she’s a pharmacist).

By the time he turned 27,  FrugalTrader decided he was going to climb out of debt and and set a 8 year plan to become a millionaire by 35.

He also committed to blogging his journey (he uses FrugalTrader as an online alias to protect his anonymity, since he provides net worth updates every month on his site

In 2006, the couple’s net worth was close to $200,000 – This takes into account around $28K in cash and savings, $70,000 in investments, $266,500 in real estate and $20,000 in two cars.

They paid off student loans, but $186,000 in debt still lingered from the mortgage and car loan.

The car loan was the first to go.

By 2010, they were mortgage free. 

By 2014, they reached the million dollar mark several months ahead of schedule! Keep in mind – they did so in spite of the 2008 financial crisis – and while raising two children. 

So how did they do it?

Let’s go back a bit further.

FrugalTrader’s father was very into investing and the stock market. So Frugal trader started investing in mutual funds at 16 years old.

Sometimes he would invest $20 or $50 a month, every dollar helped.

In college, he did a work-study program which helped him graduate without any student debt. But his wife still had student loans.

The summer after they graduated college, the couple took money out of their savings to put a downpayment on a home with two apartments.  Their idea was to live upstairs and rent the downstairs out for additional income. They were doing well managing their one rental, so they decided to pick up another property a few years later.

FrugalTraders intention was for the rentals to provide passive revenue, but it ended up being more of a hassle to be a landlord. Over four years, they had four different tenants, and having one bad tenant ended up feeling too much like a second job .

So they sold the properties and actually built a brand new home in a kid-friendly area (good for their new baby) with great schools where they still live today. They ended up paying their mortgage off in three years by putting down a large down payment, which kept their mortgage payments low compared to their incomes, and they planned to pay it off quickly – which helped keep their interest payments down. They paid of as often, twice a month and additionally at the end of each year.

Since rental properties didn’t work for their lifestyle, FrugalTrader looked into dividend stocks for passive income. “My hope is to grow the dividend income enough to pay recurring expenses,” says FrugalTrader, who owns some 40 dividend growth stocks. Johnson & Johnson is one, which has increased its dividend for the last 52 years. Coca-Cola is another.

He also invests into index funds, which he likes because “they are cheap, easy, and beat active funds after fees”. Keep in mind, his tolerance for risk is high: Some 95% of his entire portfolio is in stocks, with just 5% in bonds.

“I believe in the long-term growth of the market,” he says of his asset allocation. “I ran the numbers myself. If you bought just the S&P 500 index over the entire history of the stock market, you never lost money over any 20- or 30-year period.”

In addition to experimenting with rental income and investing in the stock market, the couple looked to their jobs to bring in extra income.

By both working full time, the couple was bringing in a combined $105,000 a few years after they graduated, up from the initial $85,000. They also worked overtime and took on extra side jobs. For example, FrugalTrader began running a few websites (including, where he documented his financial journey) and did some consulting.

The other crucial element to the million dollar journey was Aggressive saving (which we hear often from many successful young retires/millionares)

After college, the couple continued to live frugally as they did in their college years  “I think the most effective way we saved money was to keep our lifestyle inflation in check”.

For retirement savings, they’ve always taken full advantage of workplace matches and contributed the maximum amount allowed in tax-advantaged accounts.

To keep their spending at bay, they created a budget that they strictly adhere to.  Frugal spending habbits, simple things, like bagging lunches and getting books for free at the library go a long way. Although they are budget conscious, they still enjoy dining out here and there.

They’ve thought carefully about big recurring expenses, like insurance, too. For instance, whole life insurance is too expensive for what you get. Instead they have a term life insurance policy, which can cost less and protect what’s important, allowing you to invest in products that don’t have as high fees.

By the end of 2014, they hit the million dollar mark they had been shooting for, several months ahead of schedule!

In the next 5 years, FrugalTrader hopes to achieve full financial freedom.


Here are some of his goals: 

His plan is to have at a $1.3 million investment portfolio, which would allow him to quit his day job. “I can picture myself stepping away from the 9 to 5 work,” he says

He wants to travel more. Right now, the family tries to take a big vacation every two years.

He wants to pay for his children’s first undergrad degrees. He’s been contributing to their college education funds and is hopeful the balance after 17 years will be enough to cover tuition. While he invests and saves, he’s teaching them about the value of money and perseverance – preparing them for their financial future.


If you found this story inspiring, make sure to visit FrugalTraders website to get more advice and tips on early retirement and investing! Million Dollar Journey

Click here for more of this story.

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