How to Save $100K: 12 Guaranteed Steps to Get There


Do you want to have $100,000 in your bank account without having a six-figure salary?

But you look at your current financial situation and don’t think saving your first $1,000, let alone $100K, is possible.

You think there’s no way an average person could amass this amount, but there’s hope.

You can save your first $100,000 or even more than this.

In this article, I’ll show you how to save $100K.

If you follow these steps, you’ll see significant progress by the end of the year simply by setting a savings goal.

Let’s get started so you can achieve your goal of improving your work with personal finance!


You don’t need a financial educator to reach your financial goals. By following these simple steps and putting in the right amount of effort, you can start your journey to reaching $100k in your bank!
With the mindset of putting away as much as you can from your earnings, even supposedly simple acts of financial frugality can add up over years of continual practice.
Everything revolves around your positivity; you can still enjoy life to the fullest while working at that nest egg, so don’t give up before you’ve even started. You have the power to take control of your finances and shape your economic stability.

12 Steps for How To Save $100K

#1. Have the Right Mindset

how to save $100K

The starting point has nothing to do with building up your nest egg; it’s all about your mindset.

You have to stay positive, regardless of what’s happening.

There’s a great study about two people out in the wilderness.

One person has all the survival skills but a negative attitude, and the other has no survival skills but a positive attitude.

Which one do you think survives?

It’s the one with a positive attitude.

Life can get tricky, but learning to see the positives in everything will make you much happier and more likely to succeed.

If you doubt yourself from the start, you have no hope of reaching your goals, financial or not.

Therefore, learning to believe in yourself and think positively as often as possible is critical.

And I have a couple of quick tricks to help you with this.

  • Take things slow. Most times, when we think negatively, our thoughts go a mile a minute. By learning to slow things down, we keep things in perspective. When you think negative thoughts, stop, take a deep breath, and then think through the situation.
  • Take a walk. This trick is my #1 way to deal with negative thoughts. I go for a 15-minute walk. Usually, I start the walk down the tunnel of negative thinking. By the end of my walk, I’m not. What happened? Along the walk, I noticed things or said hello to someone outside. These distractions changed my thought process.
  • Find a funny video. I have a funny video saved in my bookmarks that I can watch in seconds. It distracts me from going down the well, and I end up laughing, which puts me in a good mood.

Using these tips, you can practice staying positive when negative things happen.

While you’ll never eliminate negative thoughts, you can avoid dwelling on them and allowing them to take control.

#2. Create Short-Term Goals

The next step toward having six figures in the bank is to create short-term goals.

Arguably, the biggest problem with reaching a goal of $100,000 is that you have very little or nothing saved at all.

You look at your bank account with zero in it and look at your goal of $100,000 and immediately get discouraged.

You think you’ll never be able to save $100K.

For some people, this feeling doesn’t come about until after a few months.

You work hard to save and see you have $250 toward your goal.

Then you realize it’ll take a lifetime to get there, so you become depressed and give up.

But if you break your big goals down into manageable steps, you can keep yourself motivated and, as a result, are more likely to succeed.

For example, I was in over $10,000 of credit card debt years ago.

I wanted to eliminate it but felt I wasn’t progressing with my small monthly payments.

After a handful of failures, I decided to look at my debt in smaller dollar amounts.

Instead of focusing on the entire $10,000, I focused on paying off $2,500.

My goal was to get the amount I owed down to $7,500.

This goal was more manageable and kept me motivated.

percent of payment based on goal

Once I hit this goal, I celebrated by having a nice dinner.

Then, I made a new goal to reduce it by another $2,500.

Once my debt hit $5,000, I celebrated again.

Eventually, this technique helped me get rid of my whole debt.

My $250 payment toward $10,000 felt like nothing because it was only 3% of my goal.

But that same payment toward my goal of $2,500 felt a lot more impactful.

With a smaller goal, that same payment was 10% of my goal.

Had I dropped my short-term goal to $1,000, that $250 payment would be 25% of my goal.

You can keep your main goal of saving $100K but focus on a smaller amount.

Create savings goals of $1,000.

Or break it out monthly if that amount is still too big.

Putting away $1,000 a year is $83 a month.

See how much easier it feels to save that amount?

When you achieve your smaller goal, celebrate.

Then, create another small goal.

#3. Invest Pre-Tax Dollars

One of the smartest things you can do with your finances is to invest in a 401k.

Many people with a full-time job have access to this retirement account.

What makes it so important is that you invest before taxes or pre-tax dollars.

Doing this allows you to pay tax when you withdraw at a lower retirement tax rate than your current tax rate.

Investing this way also lowers your taxable income, meaning you owe less in taxes today.

If your employer offers a company match, you essentially get free money.

Your employer will match a percentage of every dollar you put into your retirement savings plan.

What if your employer doesn’t offer you a 401k plan?

You can save in a traditional or Roth IRA.

A traditional IRA may give you a tax break upfront, but not always.

However, your earnings will grow tax-deferred, meaning you don’t owe taxes until you withdraw it in retirement.

With a Roth IRA, however much money you invest is post-tax, and you never owe any other taxes, even when you withdraw it.

Finally, even if you have a 401k, most people also recommend you open a Roth IRA.

Retirement accounts are critical, with the majority offering tax advantages that help lower your taxes and grow your money tax-free or tax-deferred.

#4. Make Saving Money Effortless

So far, you’ve worked on your mindset to stay positive as much as possible and are breaking your goal into smaller amounts to keep you motivated.

You have also taken full advantage of retirement savings.

Now comes the time to make putting earnings away effortless.

You do this by automating the process.

With a 401k, this is easy.

You fill out a form, and your employer invests your contributions for you every time you get paid.

But with other savings, you have to do the work.

The good news is that the work takes you less than five minutes, and you only do it once.

To start, look at saving as a monthly payment.

It isn’t optional, and it isn’t something you do after you pay your bills.

You should do it first.

Go to your bank and set up an automatic transfer into your savings.

The amount you save will depend on how much you make and your expenses.

Your goal is to set up an auto transfer so you never have to think about putting more money aside again.

#5. Make Sure You’re Earning Interest

You must earn a competitive interest rate on your rainy day fund.

Thanks to compound interest, doing so will help every dollar you save grow faster.

This is a fancy way of saying the interest payments you earn also earn you interest.

The best places to get a high interest rate are online banks.

The bank I primarily use is CIT Bank.

Best Bank Account
CIT Bank

With one of the highest paying interest rates in the U.S. CIT Bank stands out as the best high yield savings account. Add in ease of use and great customer service, and you have a clear winner.

LEARN MORE Read My Review
We earn a commission if you make a purchase, at no additional cost to you.

They offer one of the best high-yield accounts as well as one of the highest interest rates in the country.

My money grows faster because I’m earning higher returns.

I highly recommend you look into CIT Bank.

You can click the link below to learn more.

#6. Create a Budget

The next step is creating a budget.

While this doesn’t sound fun, it isn’t as bad as you think.

You can get as detailed with a budget as you like.

For a while, I budgeted for every single expense I had.

Then I modified things to only budget for expenses I had difficulty controlling, like dining out and entertainment.

For many, the first step to budgeting is overcoming the idea that a budget forces you to miss out on living today for an enjoyable tomorrow.

If this is you, learn to look at a budget as a tool to help you reach your savings goals.

You can still have fun and enjoy today while working on building your first $100,000.

The next step is to find a budget that works for you.

There are many options out there.

You can go with a spreadsheet budget if you want total control over your budget.

The beauty of a free budget template is you can make it exactly how you want.

You can look into You Need A Budget or Tiller Money for a more automated option.

Tiller Money - The Best Budget Solution

Tiller Money makes spreadsheet budgeting simple and fast. Use their pre-made budget and let Tiller automatically import your transactions. All you do is categorize them and you are done. No risk 30 day free trial.

Learn More Read My Review
We earn a commission if you make a purchase, at no additional cost to you.

Both will help you reach your goal.

By knowing where your extra money is going, you see where you might be overspending and can take action.

When I started budgeting, how much I wasted eating out blew me away.

At the time, I would go out to lunch four times a week.

I never did the math to understand how $15 each time impacted my finances.

I just thought it was $15 measly dollars.

But throughout a month, I was spending $240!

And this was only lunches, not all the meals I was eating out!

I decided to pack my lunch one more time a week, giving me $15 each week or $60 a month.

This small change resulted in me having an extra $700 a year.

The other benefit I found from budgeting was it helped me to question purchases more.

I thought about purchasing more before paying.

I would ask myself if I needed the item.

I often told myself I would buy it the next month and then forget about it completely.

Finally, one last option is to switch to a cash-only lifestyle.

When you use cash for everything you buy, you’ll spend less.

The reason is psychological.

When we swipe a plastic credit card, there is a disconnect, and we don’t consider the cost.

But when we use the money in our wallets, we think long and hard before purchasing.

While I still recommend building and following a budget, you can start by going all cash, all the time, and see how much of an impact it has on your finances.

If this isn’t possible for you, try looking into a charge card.

A charge card is similar to a credit card, but you must repay your bill in full each month.

This way, you won’t be carrying charges over into the next month, which will save you money in the long run.

Ultimately, the goal is to put as much into your nest egg as possible every month.

But don’t think this means you must go without indulgences and be miserable.

Find the balance between enjoying yourself and setting aside as much as possible.

#7. Avoid Debt

Never gets to the root cause of debt
Photo Credit: Deposit Photos.

To save $100K, you’ll need to avoid debt.

Spending more than you earn is a guaranteed way to save $100,000 instead of $100K.

So, you need to avoid going into the red at all costs.

By getting rid of your debts in the early stages, including your student loan debt, the sooner you can take that money and save it so it grows even more.

How do you get rid of them?

I have a handful of great articles in the pay-off debt section of this site.

There, you will find tips to help you reduce your debt as fast as possible and other tips to help you avoid it altogether.

But my absolute favorite trick is to use the snowball method.

This method has you focus on one debt at a time and wipe it out quickly.

Practicing this will motivate you to keep moving forward.

So, pick your next debt and focus on paying that off quickly.

Rinse and repeat until all your debts are gone.

#8. Generate Additional Income

To have $100,000 in the bank, you need to earn money.

And while putting away a portion of your paycheck is critical, you can speed up the process by making extra.

For starters, look at your current job.

You can quickly increase your annual salary by 5% a year or more by stepping out of your job description.

Your career is your greatest asset in terms of growing your wealth.

Because of this, you must do everything you can to increase your salary every year.

For example, assume you earn $40,000 annually and get a 3% yearly raise for five years.

After five years, your salary is $46,371.

But if you can earn a 5% annual increase for five years, your salary is $51,051.

You might see that you’re making roughly $5,000 more yearly, but you must remember that you’re earning more with a larger yearly raise.

With a 3% raise, your total earnings during this time is $258,736 vs. $272,076, which is $14,000 more.

And your salary isn’t the only thing you can work on to increase your earnings.

You can pick a side hustle to do in your spare time to make extra cash.

And if you’re smart and pick the right ones, it won’t feel like you’re working.

This is what happened to me when I started my blog.

I fell in love with it, and it never felt like work.

I looked forward to working on it and got excited when I was.

Here are a couple of ideas for you to consider:

  • Selling on Amazon. Find items on clearance and resell them for a profit on Amazon.
  • Landscape. Start a side hustle mowing lawns, picking up leaves, mulching, and more.
  • Babysit. Parents always need a reliable babysitter.
  • Food Delivery. Sign up with a food delivery service and have a business where you drive around town delivering meals.

This is just a very small list of ideas. There are many more out there.

You can make an extra $100 or up to $1,000 monthly.

It’s completely up to you and what your goals are.

Remember: The more you make, the more you can put aside, and the sooner you’ll reach the magic number of $100K!

I can’t stress this point enough.

When you start making a paycheck through a side business, you might want to increase your lifestyle with a new car or take a big vacation.

Fight this temptation as much as possible.

Assuming you set up a budget, keep your expenses low, and comfortably live on that salary, everything you earn on the side can go into your nest egg.

I put over $10,000 a year toward my goal following this plan.

If you follow along, you can save your first $100,000 faster than you thought possible.

#9. Invest More Money

We now have the basics covered to help you reach your money goals.

But this next step is critical for reaching six figures faster and creating financial stability.

You need to invest some of the extra money you earn to get there.

You aren’t looking to earn investment returns of 10% or more; just take what the stock market typically returns, around 8% annually.

There are many options for investing, including mutual funds, exchange-traded funds (ETFs), and individual stocks.

Sticking with mutual funds and ETFs is the best option for most people.

Next, we need to determine your risk tolerance.

Getting this right is critical because if you take on too much risk when the market drops, you’ll sell and lose more money.

But don’t take on enough risk, and you might not reach your goal.

Luckily, there are many ways to figure out your risk tolerance.

For many people, a 60/40 portfolio is a great option.

You put 60% in equities or stocks and the other 40% in bonds.

The easiest portfolio is 60% in an ETF or mutual fund that tracks the S&P 500 Index and 40% in a total bond market portfolio.

The final step is figuring out where to invest.

For starters, Acorns is a great option.

They are a robo advisor that allows you to start with as little as $5 and automatically invests for you.

They offer other perks, too, like rounding up what you spend, investing the difference, and depositing into your account when you shop at partner retailers.

Best For Investing Small Amounts Of Money

โ€‹Acorns changed the game when they allowed you to start investing your spare change. With a simple to use app and effortless ways to invest, Acorns is a solid choice for many investors just starting out without a lot of money to invest.

We earn a commission if you make a purchase, at no additional cost to you.

Another solid option is Charles Schwab.

This program is more hands-on compared to Acorns, but it’s the best brokerage out there, in my opinion.

Simply stick to Schwab funds or ETFs, and you’ll be set.

#10. Know Your Enemy

The biggest enemy when it comes to building wealth is you.

You see something to spend money on and don’t put it away for a rainy day, or the market gets rocky, and you get scared.

Take the time to understand your demons and work to defeat them.

If it’s overspending, stop shopping when bored, and find other things to do with your time.

Educate yourself on how it works if it’s getting scared of the market.

The more you can control your demons, the better off you will be in the long run.

#11. Focus on Your Savings Rate

Many people won’t tell you this when trying to save money.

As important as it is to earn a decent investment return, it’s even more important to focus on your savings rate.

In other words, make it a point to save even more money.

This is all because of compound interest.

The more money you have and the longer it can grow, the more it will grow.

For example, let’s look at two situations.

You have $5,000 saved, earning 3% annually.

Your friend has $500 saved, earning 8% annually.

Who ends up with more if you add $500 more yearly for 10 years?

You end up with over $12,600.

Your friend has roughly $8,900.

For your friend to catch up with you, they must save over $725 a month instead of $500.

This isn’t to say your rate of return isn’t important.

It’s an important part of the equation.

But, in the beginning, it’s more important to save money whenever you can.

#12. Track Your Progress

The final step to reach $100k is all about tracking your progress.

It’s important to track your progress as it’ll help to keep you motivated during your journey.

After all, you aren’t going to save $100K overnight or in one year.

Keeping track of where you stand pays off big time.

The best way to track your progress is to use a tried and true personal finance equation: Calculate your net worth.

To calculate yours, simply take your assets and subtract your liabilities; the result is your net worth.

Note that this number can be negative if you have a lot of debt and not much put away.

But even if this is the case, you can increase your net worth by making smarter choices as you work toward your goal of $100,000.

When I started, my net worth was negative.

I had a bunch of student loans and credit card debt and didn’t have much in savings.

I made it a point to pay these down and increase my account balances.

I quickly turned my net worth positive and have been growing it ever since.

Now, I’m over seven figures.

As easy as it is to calculate your net worth, there’s an alternative option called Personal Capital.

It’s a free app to which you link your accounts, and Personal Capital will calculate your net worth in real time.

Best Free Investment Check Up Tool
Empower (Personal Capital)

Want to know where your investments stand? Interested in a free financial plan to see if you are on track for retirement? Personal Capital has you covered. It's the best free tool for the average person to analyze their investments.

See Where You Stand Financially Read My Review
We earn a commission if you make a purchase, at no additional cost to you.

But that’s not all this powerful app does.

You can budget with it, track your investments, and even plan for retirement.

It’s the smartest thing I did with my finances since I can see everything in one place.

Even my wife, who’s not a finance person, loves using it since it’s so user-friendly.

You can click the link below to get started for free.

The final question you might have about tracking your progress is how often you should calculate your net worth.

At most, I recommend it at the end of the month, but every three months or twice a year is good.

Your Cheat Sheet to Saving $100,000

Photo Credit: Shutterstock.

This was a lot of information on how to get to $100,000.

You might be feeling a little overwhelmed; don’t be.

Here’s a simple breakdown so you can start taking action today.

#1. Open a Savings Account

Again, I recommend you go with CIT Bank.

Then, set up a monthly transfer, maybe $10 or $20 monthly.

The key is putting something away so you have an emergency fund.

#2. Create a Budget

A budget will show you how you spend so you can easily cut back or cut out wasteful purchases.

My favorite budget is Tiller Money.

#3. Pay Off Debt

The sooner you get rid of your student loans and credit card debt, the sooner you can start to save away larger amounts.

By creating a budget in the previous step, you will see how much you can put toward these debts to get rid of them faster.

#5. Save $5,000 Then Invest

I recommend going with Acorns or Charles Schwab.

Take the amount you were putting into your savings and split it.

Invest 80% and the other 20% into your savings account.

#6. Work on Your Mindset

Learn to see the positive in negative situations so you don’t get sucked into a bad attitude.

Realize that you’ll always have negative thoughts and struggles.

But the better you can deal with these thoughts, the better off you’ll be.

#7. Track Your Progress

I recommend you start calculating your monthly net worth just to get into the habit.

As you do so, you’ll see the impacts on your bottom line, motivating you even more.

Remember that you can manually calculate your net worth or use Personal Capital.

#8. Find Ways to Increase How Much You Make

This could be earning a larger wage at work, getting some education to make you more valuable to other employers, or starting a side business.

Whichever path you choose, be sure to put aside as much as possible.

#9. Reduce Your Expenses

Sadly, your monthly expenses are never a fixed amount, and over time, they increase.

But there are a few ways you can keep them low.

Think outside the box when it comes to money-saving tips.

Do you eat out a lot?

Could you get by on a peanut butter and jelly sandwich or pasta once or twice a month?

If so, cut out $30 and put that toward your goal.

Now, take a look at your other expenses.

Have you tried negotiating your cable lately?

Have you shopped for insurance coverage?

Either of these could turn out to be a significant amount.

You can use BillTrim and have them slash your bills for you.

From there, you can get free insurance quotes from Insurify to lower your premium.

By doing this, you can save a few hundred dollars a year.

#10. Take Advantage of Windfalls

If you get work bonuses, tax refunds, or other windfalls, save them; they can speed up your progress more than you think.

And here’s what I do to stick with this tip.

I take 10% of my windfall and spend it however I want, no questions asked.

It’s mine to do with as I please.

Then, I take the other 90% and invest it.

It’s a simple mental trick I use to enjoy life now and stay on track with my goals.

Frequently Asked Questions

frequently asked questions

I get a lot of questions about how to save $100,000.

Here are the most common ones and my answers to help you succeed.

How to Save $100,000 in a Year?

To save $100,000 a year, you must drastically change your spending and earn much more.

First, you need to eliminate as much spending as you can.

This means no more eating out, and when you shop for groceries, you must buy the lowest-priced items serving multiple meals.

Oatmeal, pasta, and eggs are a few items off the top of my head.

Then you need to get serious with other areas of spending.

You might even have to move to a cheaper location.

Next, you need to increase your income.

You cannot put aside 100% of your salary, so don’t think if you’re earning $40K a year, you only need to earn another $60K.

You can use side hustles, but you probably need a job promotion or switch employers and get a higher starting salary.

It’ll be a lot of work and is not something I recommend for most.

How Much of My Paycheck Should I Save?

You should put away 15-20% of your annual income.

This amount will put you in great shape to handle emergency expenses and enjoy retirement.

If saving money is a struggle, work up to this goal.

Try putting away 5% of what you earn.

Then, increase this amount the following year and each year after until you reach 15%-20%.

If you can put more aside, do it.

You can never save too much money.

Final Thoughts

There’s the blueprint for how to save $100K; you just have to have to follow this plan and put in the hard work.

All you have to do is to start taking action.

The first step might feel overwhelming now, seeing how far you must go to reach your goal, but you can do it.

There are many people out there who have saved $100,000 on their path to financial independence.

If you follow these steps and take advantage of the recommendations expressed here, you can do it, too.

And here’s the best part: Thanks to compounding, after saving your first $100K, the next $100,000 is a lot easier.

And then every $100,000 after that is even easier.

You can do this; you just have to take that first step.

Make today the start of your new financial life!

16 thoughts on “How to Save $100K: 12 Guaranteed Steps to Get There”

  1. That bullet list makes it all sound so easy. I guess if you really can do well in all of those points it truly wouldn't be very difficult. The biggest one if definitely generating additional income. It will make the biggest impact for sure.

    By the way, that wilderness survival study sounds quite interesting. I may have look that one up since it sounds like it really reinforced the power of positive mindset. I know I wouldn't have expected those results.

  2. Thanks for sharing this, this is valuable information. I don't think a lot of people take time to find ways to save money! This is brilliant!


  3. I agree with a lot of it (and Modest Money, too). Increasing your income and decreasing your spending (by eliminating taxes, interest, etc.) is really not rocket science. The trick is to do it. There's always something you can NOT buy. And there's always time you can spend making more money. Eventually, though, it gets tired. The key for me is maintaining focus and a fast enough pace to move the ball forward.

    I found auto-investing to be the easiest way for me. I view my take-home pay as after taxes, benefits and auto-investing. So I just budget the rest. It's actually much simpler than any five or seven step program. The way I see it is, set up auto invest, live on the rest and it's only a matter of time before you have $100,000 or more (assuming you invest in things like index funds that have little chance of going to zero).

  4. Awesome tips! I’m definitely striving to create additional income and be more specific with my savings goals. Mindset is extremely important and without it your chances of getting to where you want to go are zero.

  5. They say the first 100K is the hardest to save. Once you do the next hundred thousand will be easier because of compound interest and your ability to save has improved. Great Post.

    1. Once you get the compound interest train humming along, you really start to see big increases in your savings over shorter periods of time. If only more people had the patience to save up a good amount, they could experience the thrill of compound interest!

  6. This is the first year that I started focusing on shorter-length goals. Every three months I set new goals that I can achieve over the 3-month period. Some of them are really longer-term goals, but broken into smaller time periods makes it easier for me to see progress and motivates me to keep going.

    1. That’s a great strategy! I love using short term goals even for long term goals myself. It keeps me focused and pushing forward.

  7. The how to part is easy. The real question is “how long does it take to save $100K” after doing all those tips? ๐Ÿ™‚

    1. Very true! It won’t happen overnight, I can assure you that! But in all seriousness, it really depends on how bad you want it. If you want it, you will find ways to stretch your money and delay wants to get to where you ultimately want to be.

  8. Hey Jon,

    Great post, 100K is a decent amount to most people and if it isn’t then good on the person for probably working hard to save up that sum..

    The best point you make above is about earning additional income, from here you can then achieve all of the rest, except mindset, once you have the mindset and earning extra $$ the rest will fall into place nicely ๐Ÿ™‚

  9. Thanks for sharing! We all have financial goals, and I think it’s just a matter of actually doing something to make it happen. The tips on the article are definitely a great start.

    1. Agreed that doing is important. If you write down your goals but never do anything to reach them, then what good are they?

  10. I think you pretty much hit the nail on the head. If you have a PMA, live below your means, and work to increase your income you will save $100,000 or more in no time!

Comments are closed.

Scroll to Top