If Earning the First $100K Is the Hardest, What Do You Do After That?

They say “the first $100K is the hardest”—but that doesn’t mean your investing and saving journey ends there. So, where does that phrase actually come from, and what does it mean for your money today? Plus, here’s why what comes after that $100,000 matters just as much.

Key Takeaways

• Building the first $100,000 is hard because you don’t benefit as much from compounding in this earlier stage of saving; instead, you must develop both strong saving habits and a healthy income stream.
• Even after reaching a financial milestone, sticking to a simple, consistent investment strategy is key to continuing to grow your wealth.
• Discipline becomes harder, not easier, as your income and savings grow, but remember that wealth isn’t necessarily the goal—it’s the tool to achieve your personal and emotional goals.

Where Did The Saying Come From

The idea became famous after the late legendary investor Charlie Munger told Berkshire Hathaway shareholders in the 1990s that the hardest part of building wealth isn’t becoming a millionaire—it’s reaching that first $100,000.

“You’ve got to do it the hard way,” Munger said. “I don’t care what you have to do—if it means walking everywhere and not eating anything that wasn’t purchased with a coupon.”

The point? Wealth builds on itself. Once you hit six figures, compounding, income growth, and smarter financial habits tend to make the next milestones easier.

How to Save Your First $100K

“Saving is about developing the habits to spend less than you make, but saving $100K is also about learning skills to earn a significant income,” says Noah Damsky, founder of Marina Wealth Advisors. “Building good habits and skills to earn is no easy feat.”

According to Damsky, it’s those foundational behaviors—saving consistently and increasing your earning power—that take the most effort to build.

But after they’re in place, the path becomes easier. “Once you develop the habits and skills to save and earn, it can become second nature, like riding a bike, to keep it up.”

Don’t Complicate the Next Step

After reaching $100,000, many people start to second-guess their strategy. Should they pivot to cryptocurrency? Start picking stocks?

Avoid that trap—especially if you’re not an experienced investor. “Maintaining discipline and avoiding distractions are the hardest parts of building wealth,” Damsky says.

Instead of trying to pick the next market-beating stock, Damsky recommends sticking with low-cost, diversified index funds.

“Find a Vanguard fund that tracks a big, boring index, and ride the wave until you need the money.” That means continuing to save, even if the amounts are smaller, and resisting distractions.

Set the Right Goal—And Stay Focused

Once you’ve built that initial cushion, the question becomes: What are you saving for?

“Your goal isn’t to build aimless wealth,” Damsky says. “It’s about achieving your dreams, such as buying a home, retiring, starting a business, or creating memories on a vacation of a lifetime. Wealth is just a tool. It’s the bridge to your goals.”

The habits you used to reach your first $100,000—automated contributions, living below your means, avoiding debt—are the same ones that can carry you forward. But now, it’s about aligning your money with your values.

Avoid the Lifestyle Trap

One of the biggest risks after reaching your first major milestone is losing the discipline that got you there. Even Munger himself warned of lifestyle creep.

“In our 20s, we keep our old junky car because we can’t afford anything better,” says Damsky. “In our 30s, maybe we’ve saved for years and have the money to buy a new car. The hardest part, though, is not buying it even though we can.”

Having the means to spend makes it even harder to say no, but staying the course matters. “Losing that discipline is the most common derailment to building wealth over the long term,” says Damsky.

The Bottom Line

Reaching your first $100,000 in savings and investments is a major accomplishment, but it’s not the finish line.

If you want to turn that into $500,000, $1 million, or more, the playbook is largely the same: Keep your savings strategy simple, avoid lifestyle inflation, and make sure your savings are in service of the life you actually want.

That means maintaining a clear view of your goals for you and your family, and developing a savings and investment plan that helps you to accomplish them.