How Imani Porter grew her net worth to $200,000 at age 25

  • The frugal 25-year-old Imani porter grew her net worth to $200,000 by investing.
  • She automatically transfers 60% of her salary to her brokerage account.
  • Porter also automates 15% of her paycheck in an employee stock purchase plan.

After 25-year-old Imani Porter paid off $25,000 in student loans, he started thinking about how to build wealth. “I’m generally a very frugal person, so I started hoarding all my money in savings and not really investing,” Porter told Insider.

First Porter started following her

net value

† “It’s like your own personal scorecard,” she says, adding that keeping track of her net worth prevents her from taking on any more major debt.

Once she realized that saving alone wouldn’t help her build wealth as quickly as she imagined, she turned to her peers in the financial technology industry for solutions. Porter says, “I work with a lot of smart financial people who said to me, ‘No, you have to invest your money. That’s the way you get rich.'”

According to data reviewed by Insider, Porter’s net worth is now $200,000. To make things as easy as possible for you, Porter automates its investments in three easy ways.

1. Employee Stock Purchase Plan

An Employee Stock Purchase Plan (ESPP) allows employees to buy shares in their company at a discounted rate, usually up to 15% less than market value. For example, if you are an employee of 3M with a 10% ESPP discount, you can buy shares at $129.78 per share instead of the current market price of $144.21. If the stock rises in value to $150 or $200, you will see a significant increase in your net worth even though you bought stock at a discounted price.

Porter tells Insider that she has chosen to have 15% of her salary automatically withheld to buy stock in her company.

2. Retirement accounts

According to data reviewed by Insider, Porter contributes to a 401(k) and a Roth IRA taking full advantage of her business match. A 401(k) is an employer-sponsored retirement account where employees can contribute pre-tax income and grow it in the marketplace over time.

A Roth IRA is an account that you can fund with after-tax income, allowing the money to grow tax-free with no additional taxes on withdrawal. Porter’s retirement accounts are worth $78,000 together.

In addition, Porter contributes to a health savings account (HSA) through her paycheck, a threefold tax-advantaged account that can be used for health-related expenses, such as over-the-counter medications and menstrual products.

3. Brokerage Account

After Porter’s retirement, ESPP and HSA contributions, her net pay is about $4,000 a month. Of that $4,000, Porter automatically transfers 60% directly to her brokerage account. Combined with her company shares through ESPP, Porter’s investment accounts are worth $76,000, approximately 38% of her entire portfolio.

While this technique helped Porter build her wealth quickly, she built a solid cash foundation first. Her rent, car payments, and living expenses are about $1,000 a month on a budget she closely manages. She adds, “Of course I have my six months worth of living in an emergency fund and I’m always looking for ways to increase my income.”

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