I’ve Built Up a Six-Figure Investment Portfolio on an Average Salary—Here’s How

all before turning 30, too
Source: Esra Korkmaz | Pexels
Source: Esra Korkmaz | Pexels

Investing is often touted as being key to building wealth, but it can often feel like there’s a big gap between investing $20 a paycheck and waking up retirement-ready in 30 years. Does it actually work? How do you get started? In my experience, it’s kind of like how you follow the steps for amazing skin and then just have to trust that all of those tiny pimples will be gone when you wake up. While I’m still waiting to see the full magic of my skincare routine, I can attest that investing is pretty magical and does work over time.

I started investing at the age of 20 after receiving a small one-time government grant for living with a chronic illness (yay me). It was just a few hundred dollars, but a requirement was that it needed to be invested until I hit retirement age for me to keep it. Forced investing, if you will. Up until that point, I knew about investing in theory but had never dabbled in it. Suddenly, I had to go to the bank and open an investing account and decide what to do with that money, which was intimidating. I read some books, did some light research on exchange-traded funds (ETFs), and just went for it. Now, almost ten years later, that money has grown to be a six-figure nest egg, and I never had any huge salaries or inheritance to use. Here’s a guide to how I did it so you can, too!


1. Pick the right account for you

The first option I was presented with when I arrived at my bank in person (old-school days!) was what type of account I wanted to open. There are a few different options to pick from, some of which offer tax benefits in the form of a refund when you file your taxes or you won’t be charged taxes when you withdraw the money down the road. These are your typical 401k and Roth IRA accounts, and they have a limit to how much you can put in them each year. There are also non-tax-sheltered accounts that you can open and invest as much as you want, but you’ll pay taxes on any gains you make. I opted to go for a tax-sheltered account as I knew I wouldn’t be maxing out the amount I could put in anytime soon (a girl can dream…), and it was nice knowing I didn’t have to worry about paying taxes on my investments for the foreseeable future.

The other thing I considered was where I wanted to invest my money. I first went with an account run through my bank (the same one my parents had used forever), but after a few years, I decided to move my money over to an online investing platform with lower fees. Keep an eye on those fees, even 2% can eat into your investments over years and years! I recommend looking for something in the 0.5% or below range so you keep as much money as possible.


2. Pick the right investments for you

Once I had my account set up and added my money, it was time to decide what to invest in. Originally I was drawn towards mutual funds—they seemed safest since they’re managed by professionals and are pretty hands-off—but after doing some research I realized that I could do it myself, so I opted for buying several different ETFs. ETFs are naturally diversified since they consist of little bits of shares from hundreds of different companies and have historically done well (the S&P500 follows a lot of the big household names, for example). Deciding to go with ETFs rather than high-fee mutual funds or individual stocks turned out to be a good bet for me because it kept my fees low and eliminated the need for constantly buying and selling like a wolf on wall street.

In addition to buying ETFs, I also had a small chunk of my portfolio with my work benefits (more below!) in a different, managed investing platform. The only decision I needed to make here was how safe or risky I wanted to go with my money; safer investments are lower risk but lower reward, while riskier investments have a higher possibility for making more money over time but with a bigger possibility of risk (duh). When you’re young and have a long investing timeline, such as 30 years until retirement, you can afford to go a bit riskier with your investments and ride out any ups and downs, which is what I opted to do. There are lots of great calculators online to help you determine your risk level, but being less conservative as a young investor allowed me to grow my returns faster.


3. Set aside money from every paycheck or income source

I decided early in my investing journey that I was going to view my investments as non-negotiable and I would put some amount of money, no matter how small, into my account when I got paid. I think this has been the #1 thing that has helped me grow my investment portfolio over the years. I haven’t stuck to a set percentage as my income has fluctuated a lot over the past ten years, but rather a number that feels right based on where I am at the moment. Sometimes that meant $20 per paycheck while working part-time in college, other times it meant $1000 a month when my day job and freelance work were booming. I also applied this to birthday money, tax refunds, and bonuses (so fun!).

Regardless of the amount, if you put something into your account on a regular cadence that works for you, you’ll be amazed at how quickly the compound interest starts adding up. I like to automate my investments so I don’t see the money sitting in my checking account and have to decide to move it each time (I’m not that motivated!), and I also keep a net worth tracker above my desk so I can see the numbers increasing little by little.


4. Monitor your accounts regularly

A lot of advice out there recommends not looking at your investment accounts because the ups and downs can feel scary, but regularly monitoring my investments was actually something that helped me build up my portfolio. The first reason was that it reminded me that I had skin in the game and needed to stay informed. It wasn’t a lot of money, but it was my money (and $20 a paycheck in college felt like a lot!) and I wanted to know what was happening with it. The second reason was that regular check-ins allowed me to reinvest the dividends I was receiving, which is a small amount of money a company pays you for owning their stock, as well as monitor the fees that were being taken out. While the ups and downs can be a little tough to stomach, I always recommend checking your investments every few weeks so you can keep an eye on things and make corrections early if necessary.


5. Get help when needed 

After a few years of investing a bit each paycheck and reading a bunch of investing books, I decided to splurge on a session with a fee-only financial advisor (they get paid only for their advice, not for products or services they sell) to get her take on whether my portfolio was set up for success. I had grown some nice compound interest over the first five years, but she helped me see that I needed to increase my contributions to hit my goal of a six-figure portfolio before 30. She helped me figure out how I could reinvest more of my tax refund each year, and that I should have more ETFs outside of just tech and retail for diversification. While the session seemed pricey upfront (about $300), having that customized, unbiased financial advice helped me to double my returns over the following few years to hit my six-figure goal.


6. Use government and employer investing options 

In addition to regular contributions, the next biggest way I was able to grow my investments was by ensuring I was using all free investing money available to me. I was pushed into investing when I was given that small government grant, but I realized I could reapply every few years to get another couple hundred dollars from the same program. It was work, sure, but it was worth it! Every dollar counts when it comes to compound interest.

In a similar vein, after a few years of working, I joined a company that offered employer-matching 401k benefits, which means that you put a certain percentage away from each paycheck (usually up to 5%) and your employer will also give you a certain percentage, matching what you contribute. I started doing this in addition to my regular contributions and it helped push me over the six-figure mark earlier this year at the age of 29. Without this free investment money from my employer, I would have had to cut corners by giving up some dinners out or new clothing purchases, which I never want to do. Everyone should check to see if their company offers a retirement match and do some research to see if there are any government programs that you can tap into, it’s worth it!


7. Stay true to your plan

Last but not least, the ultimate strategy that helped me grow my investments was simple: sticking to my plan and staying consistent. Listen, I’m not saying there weren’t months where I would have preferred to spend the $50 I invested on a dinner out, but I put it away in my account, even when other financial goals came up. I also watched with my hands over my eyes as my portfolio took a nosedive at the beginning of the pandemic, but I didn’t pull out my investments or stop putting money in. I just kept going and trusted that I had enough time to ride out any ups and downs, which I knew would happen eventually. And it did—my portfolio fully recovered after the pandemic and is doing better than ever, sitting pretty at a little over 100k. Trust me, if I can do it, so can you, the key is just getting started and staying consistent, and then letting the stock market do its thing!