This is a picture of my mentor, David. He is like Yoda to me when it comes to matters of money.

I used to work under him at Amgen, and after working my angles to get in his good graces, was able to gain the privilege to learn how he got to where he is today. He left in 2006, and now lives quite a fabulous, quiet life. He travels with his wife around the world, maintains his business, and stays active. He is kind of paragon of the way I’d like to spend the later years in my life.

In this picture, I was able to meet David for lunch at the Harbor Seafood Restaurant after over a year since the last time we met for breakfast. As we scarfed down the delicious dim sum (this place was AWESOME!), we caught up on all of the corporate gossip – who was where, who had what kids, what happened to this person, this and that, just like old times.

In our discussion, I brought up real estate investment, as David had considerable experience in this area. He gave me a very Yoda-like answer instead of the quick tip that I was hoping for – he basically told me to go get an education specific to real estate, then come back to him when I know what I’m talking about. Later on I registered for some classes at the UCLA extension to learn more.

David mentioned an interesting item however in our talk. When I asked him how much liquid I’d need to save to get started in substantial real estate, his number was 500k.

Five hundred thousand dollars.

That seemed to be the magic number by which an investment of serious cash flow could be established. His rationale was for me in my case to focus on my core business while putting money away in anticipation of a rainy business day – and if everything went well, to have 500k liquid ready for a worthwhile investment.

With my current business, I have a pretty good idea about how long this will take. Won’t happen overnight, but I can anticipate when this can be a true reality. It absolutely won’t be easy, but again, I see that it is possible.

However, if I didn’t have my business, for me to even fathom saving 500k was out of this world. Let’s say for example, I was earning a 200k salary with my shiny Pepperdine MBA (good luck with that btw). IF somehow I made that happen, and I lived off of the approximately 120k that I’d have after tax, this makes for approximately 10k per month to dedicate towards the expenses of life. Rents or mortgage, retirement investments, groceries, eating out, bills, and other high-priority miscellany and now I’ve got 5k left if I’m truly frugal and my life starts to become boring. Let’s say I put that 5k best case scenario away each month in a low-risk CD or index fund. After a year, I’ve got a whopping 60k, and after adding tax-deducted interest it’ll take me a little closer to 65k. At this rate, it takes close to 8 years to save 500k.

Introduce a family and children into the mix, and that 500k is going to get tapped to cover increasing expenses. However – let’s say BEST case scenario, one saves and saves and lives super frugal while having a family, under the same assumptions of saving 5k per month. It will take the modest family close to 10-12 years to save that kind of money. By the time that much time has passed, the pressures of life and risk averseness set in, and I imagine that 500k will be put into investments of low risk.

So, it’s basically impossible to save 500k, even with a 200k salary. I guess it’s not a realistic goal for most in the first place anyway- at least that’s what David said.

The only real success I hear of in this rat racing world are those that make it to the C suite, or those who have made lucky moves in their career, being in the right place at the right acquisition. So the takeaway is, one grinds their way through the political corporate ladder with stress and strife, or depends on sheer luck to achieve financial freedom.

If joy can experienced in the margins of this grind, man I hope that joy is surely worth it.