Unless my little spreadsheet here is wrong, if we assume you can invest at 3% above inflation, saving 50k per year will get you a million dollars in 16 years.

The second million only takes ten more years. Nine years after that, at year 35, you get your third million, at which point you might consider retiring and living indefinitely on your $85k annual investment income.

How conservative is 3% above inflation?

Also, who, even in the high salary brackets, can save $50k/year?

3% is fairly conservative: According to the calculator here:

http://www.moneychimp.com/features/market_cagr.htm

...over the last 40 years an S&P 500 index fund had annualized returns of 10% before inflation adjustment, 5.5% adjusted for inflation. That's, like, twice as good as my guess! And no need to invest in real estate for that: That's a Vanguard index fund.

Of course, over the last ten years the equivalent annualized return is only 1.5%, which goes to show you that (a) depressed global economies are no fun and (b) there is some rationale behind my choosing to use a more conservative number.

As for "how does one manage to save 50k per year?", the sad answer is that I don't, and most of us probably don't. But many tech workers could, in theory. The median income in San Francisco is "only" $42k:

http://blog.sfgate.com/ontheblock/2011/03/07/bay-area-tops-s...

More than half the people in SF are staying alive somehow on less than $50k per year. Figure out how to live like them and it might not be hard to save $50k per year... if you have a Bay Area developer's salary. Which, obviously, is not the case for everyone.

Also, making an additional $50k per year is a reachable goal, relative to most get-rich-quick schemes. It's $4200 per month. The OP is halfway there, with one $2k/mo product.

I've been running the numbers for myself, while looking into moving to SF. With current tax rates (state and federal) considered, for me as an individual being able to save/invest $50k/year would be around $100-110k salary mark.

Housing expenses (especially in SF area) make that really tough. But if you're married with both of you working, only have one (used) car, and both of you live frugally, it can be done.

i've done it consistently for the past 10 years. if you have some discipline, set up automatic investments, it's easier than it sounds.

I already have a 401(k) and a normal brokerage account through Vanguard, invested in a few good index ETFs. I set it up a few months ago and I remember there's some paperwork I still have to find and handle, but mostly I haven't looked at it.

When I'm actually making money I can transfer into American dollars again, I'll be dumping some fixed amount of it straight into those accounts for investment.

However, I currently make far less than $50k/year due to being a grad-student, so it's not like I can save nearly that much.

1. I don't have a CS degree or any high-education degree.

2. I don't live in the US or a developed country.

3. Middle/Lower Class family with no superior connections.

Edit: 4. I have a WP product selling @ $2,000/month. I'm looking for some dramatic change, though.

1. Neither do I.

2. You've got me there.

3. Neither do I.

Congrats on $2k/mo from Wordpress. You can't do another one and make it $4k/mo? Maybe if you picked a specific industry vertical to target, like lawyers or accountants, you'd be able to charge higher prices. Maybe if you rethink the packaging of your offering --- instead of "a product for Wordpress", you sell an entire offering that happens to be "Wordpress Compatible" --- you can escape the price points people have for Wordpress offerings.

4. I learned the trick and I'm building another $1-2k product. $4k is much harder because these markets are highly competitive. But I can't build 25 products and support them (or manage their support). Maybe a couple products that sell for $25k/month.

I sent you an email.

Having a $2k/month semi-passive income stream is pretty relevant to this discussion!

Given that you have the savvy to get that much, you would do much better to develop and build upon that success than to start trying anything else. A lot of people struggle and it takes them years to get to $1-2k a month in product sales. If you can do that now, you could be at the pre-takeoff point of a hockey-stick curve without realizing it.

I would take tptacek's advice, and develop your WP product. Make a Pro or Enterprise version, make a version with a monthly support cost, offer a premium support plan, offer annual billing, make a family of related products, etc. Or do all of the above.

The thing about that plan is, you get taxed and you pay land rent like someone who makes $120k.

Sure; on the other hand, you're accepting much less risk.