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Can a 45 year old couple have $1.5 million liquid net worth and be debt free? Math shows its very plausible

I saw this question posted on HardwareZone so I thought I will tackle it. The question asks whether it is rare to find folks currently in their 40s to be debt free and have a liquid net worth of $1,500,000.

I think we all tend to not know the math behind the end result and thus at first thought, this seems rather rare, but the math below does show that it is entirely possible, and you can have a sensible monthly amount left over.

Before I get on with the numbers, I want to state that I am not doing some every university graduate can achieve this article. There are likely subset that don’t fall within this scenario but it is likely that there are niche number of your friends and acquaintance that do.

If a person is 45 this year, 20 years ago, the couple should be 25 years old and perhaps just graduated. They probably are not married yet, but working towards getting married, by saving up for the big stuff in their lives.

The year then should be 1995, 2 years before the Asian currency crisis. It is entirely possible that much civil sector folks, Temasek linked company folks are earning an AWS and 2 month bonus consistently. Over 20 years there can be good years and poor years, they smoothed out to a consistent 15 month annual salary.

The part that I am unsure of was the possibility of a starting salary of $3,000 per month. I suppose that is possible as those were the go-go years when things are getting great, not many will anticipate the upcoming Asian Financial Crisis.

A young couple who starts earnings $3000 each and hold an annual income of $45,000, given the bond like nature of their jobs could reach such a conclusion.

The single income take home grew from $2,400 to $4,334 20 years later at 3% per year. There are some folks who will be incredulous if you tell them at 45 years old a middle manager is taking in $5,418 gross income and not more, but lets just leave things like this.

The rest are just math really.

The key thing to focus on are highlighted in yellow.

The dual annual income net of CPF accumulated shows the total amount a couple over 20 years have earned. This is $1,934,666.

This might shock some folks but this sum is large enough that perhaps, you need to be responsible with how you allocate it.

Below that I showed 5 different levels where the dual income couple can put into  their wealth machine, or their way of building wealth, at a conservative 3% rate of return. Corresponding to the right, I showed the monthly amount left over for family spending at age 25 and 45.

From the math, the figures closer to $1,500,000 is when the couple channel 50% to 70% of their take home income.

It may be be quite hard to believe that a couple can survive on $3,000 per month, but I believe some of the folks who have good self controlled, dual income with no kids, or dual income with one kid can make it work. Myself have shown that I can work with $2,000 for a family of 3.5 people.

And your income would grow over time as well to have a bigger spending sum to work with.

A 5 room HDB home cost around $280,000 then. So with a combined CPF OA accumulated of $574,596, the couple should be able to pay off the HDB flat with enough to spare.

Last Word

I think, if I am wrong that some couple in 1995 can start with $3,000 per month, I am quite sure that many today do start with that amount.

If there are lessons to be learn it is that, if you don’t work out the math, you won’t realize how valuable a couple’s 20 year human capital is. You have nearly $2.7 million to work with, and if you screw that up, that is on you guys.

If you say, you can’t work with $3000 per month in spending for 2 person, or that you don’t have so many month of bonus, just learn the math and vary it and see what you can come up with.

I am sure folks would be rather happy that they are debt free with $800,000, rather than not taking action and start planning and communicating with their spouse and not having this much at all.

If you would like to find out more of the math behind how to get wealthy, what makes the most impact, do take a look at my wealthy formula here.

If you like this do check out the FREE Stock Portfolio Trackerand FREE Dividend Stock Tracker today




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Friday 19th of August 2016

Btw, can you please change my published name to mummy1234 please?


Thursday 18th of August 2016

Hi, my hubby and I are in our early to mid 40s and have a net worth of 2 million including our 3 properties. Thanks to the ability to leverage and the boom in our landed terrace valuation. So we can actually cash out and buy a HDB and have 1.5 mil in liquid cash. Do read my blog at if interested to know how I did it.


Thursday 18th of August 2016

btw your blog seem to be set up in a very strange manner. when i click into one article, it still show me snippets. i need to click in further to read.


Thursday 18th of August 2016

Hi Cindy How, thanks for letting me know. congrats and i will read your blog from time to time.


Sunday 21st of June 2015

Hello! Kyith, 20 years ago, starting pay of graduates were much lower. Accountancy grads drew below $2k whilst engineering grads were about $2.2k. Your hypothetical target at 45 yrs old is achievable. I think the following is important: (1) Wealth machine to consistently generate above average returns (>10%); (2) Being frugal, living within means in early years; (3) Work harder and smarter than peers to get better increments and promotions. Just my thoughts...


Sunday 21st of June 2015

HI bookworm,

Thanks for point out my mistakes! looks like i am overreaching here. I think (1) is not known to many, but perhaps they invest in properties and thus is able to achieve this. (2) we do see much here and there. (3) is very common for a group of folks, and perhaps why they will reach this sum much better than their peers.


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