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Millionaires, by the book
Florida couple shows there's room for advanced degrees, travel and saving 30 percent of your income.
May 3, 2005: 11:34 AM EDT
By Steve Hargreaves, CNN/Money staff writer

NEW YORK (CNN/Money) - At some point either during or shortly after getting an undergraduate degree, many people ask the grad school question. Do I continue to pursue my academic dreams or enter the world of work?

Often creature comfort trappings prevail, and hitting the books takes a back seat to paying the bills and saving for the future.

But Amy Chan Hilton and Edgar Hilton didn't make that bargain.

After graduating from MIT, where the couple met while doing a summer internship, they continued on to earn Master's degrees and, for Amy, a doctorate in engineering from the University of Virginia. Edgar's doctorate in engineering is coming soon.

They were lucky enough to get paid to go to grad school, but still needed to survive on a combined stipend of $2,500 a month. They not only survived, but continued socking away whatever they could into IRA accounts, a habit formed years earlier.

Now the highly educated couple have been in the work force for five years and can command an ample $140,000 combined income in Tallahassee, Fla., where 32-year old Amy is a professor of environmental engineering at Florida State University and 33 year-old Edgar is a manufacturing consultant.

The mechanics

Having laid a nice little base from their college years, the couple now invest pretty much by the book, setting aside 20 to 30 percent of their income in mostly large cap mutual funds through various retirement plans.

"In a happy world, we'd like to leave our 9 to 5 jobs by the time we reach 40," said Edgar. "We don't want to be working our entire lives. We want to enjoy things; family, friends, each other."

To help them get there, Amy relies on a 403 (b) retirement plan, similar to a 401 (k) but for non-profits. Her university contributes 10 percent of her weekly salary while she manages to kick in another 20 percent or so, or $350 a week. She also maxes out her Roth IRA, contributing the full $4000 a year and keeps about $3,000 to $5,000 in a cash account.

Edgar takes advantage of the SEP IRA plan for self employed people, to which he has contributed the full $12,000 a year for the last five years. He maxes out his Roth IRA as well and has some $20,000 cash on hand, which they may invest in real estate in the near future.

In addition, the couple bought a 4 bedroom, 2 bathroom brick house five years ago for $184,000, using some $10,000 in savings they had from graduate school and before as a down payment. They made $20,000 in mortgage payments and have seen its value almost double. They also have a small rental property in the area that generates some $3,000 in profits a year.

Although there are plans for children someday, they currently have very little in the way of student loans thanks to scholarships and no credit card debt.

The result is savings totaling almost $300,000 and another $100,000 in home equity.


Maintaining a 30 percent savings rate requires some sacrifices. They said they employ such tactics as cutting coupons, going to the early showing of movies and buying things only on sale.

They've also resisted temptation. When the Cooper Mini came out, Edgar says both he and Amy were dying to trade in their secondhand BMW 5-series and Subaru Outback for a sexy convertible or sporty hardtop.

"We're both car lovers and we really wanted those," said Edgar. "But we're going to hang on to ours until they fall apart."

But it's not as though the couple has no fun. Amy said they go out to eat four or five times a week and take at least one big vacation a year, last year to Banff National Park in the Canadian Rockies.

"We try to prioritize our money," said Amy. "But it's not like we're miserly."

So what happens if and when the 9 to 5 comes to an end? Edgar said he'd like to continue consulting but on a part time basis, while Amy says the university may provide a flexible work schedule.

They would also like to continue to travel.

"This is such a beautiful country, it would be a shame to spend your whole life working and not be able to enjoy it," said Edgar, who was born in Mexico and lived there until he was eight. "Road trips are definitely going to be somewhere in there."

Click here to read about Millionaires in the making Dave and Annie Hall.

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