Is it Really Possible to Become a Millionaire?
A lot of people want to become millionaires. But is it even possible? It sometimes can seem as if there are millionaires all around us – but can you become one of them if you really want to? It is possible, but you need to have a plan and to be ready to stick to that plan.
Get Rich Quick Infomercials Won’t Get You There
Probably the worst thing you could do would be to watch get rich quick infomercials on TV. Infomercials peddle all kinds of ideas on how to become a millionaire. But they build a rich looking lifestyle around what is usually a very weak money-making opportunity. In fact, they seem to spend more time selling you on the lifestyle than explaining what it is you need to be doing to make the money come in.
The other very important point that they neglect to tell you is that even if you could make a lot of money using the systems they are selling you, that still may not make you rich. That’s because there’s a huge difference between having a high income and actually becoming rich.
You could make a lot of money but also spend a lot of money, in which case you’d never actually be rich because you would have nothing to show for all of the money that you earned. Being rich is about having money, or more particularly, what you have left over after spending. That’s the all-important “other half” of becoming a millionaire. It’s more about financial discipline than it is about making a lot of money!
You can spend a lot of money trying to get rich from TV infomercials, but you’ll never become a millionaire trying to do it that way.
The Slow, Steady Way To Become A Millionaire
There‘s no magic involved when for becoming a millionaire. It’s more a matter of becoming a diligent saver/investor. You don’t need a get-rich-quick scheme to make that happen.
What that means is a willingness to faithfully save money on a regular basis as well as a willingness to invest the money in the best combination of assets that will make the money grow over a very long period of time. And you can do this by saving a surprisingly small amount of your regular paycheck.
The Earlier You Start, The Easier It Is
If you start saving at 25, and assuming an eight percent annual rate of return, you can become a millionaire at 65 by saving just $286 per month. That’s $3432 per year, and that’s well below the $5,000 the IRS allows you to contribute to a tax deductible individual retirement arrangement, or IRA, each year.
By contrast, if you wait to begin saving until you’re 45 or older you’ll need to save more money each year – a lot more money! In fact, you may need to save several thousand dollars per month in order to reach the $1 million mark by the time you turn 65.
If you start saving when you are young there’s a much better chance that you’ll reach your goal. This is especially true if you are in a career field that typically pays a more modest income. If you want to become a millionaire time will be your best friend if you use it wisely and start saving early.
Tracking Your Progress
Since becoming a millionaire is largely a long-term mechanical process, you may need some help along the way in the form of money management tools.
Fortunately, there are financial money management tools, called account aggregators and you can get some of them for free. Account aggregators allow you to track your finances all in one place. You can track your transactions and your balances so that you know exactly where your finances are at any time. They will also show you what your loan balances are and what bills are coming due.
Account aggregators can also display your financial information graphically. This will be very important if you are the kind of person who learns and understands visually – and that describes a lot of people. Charts and graphs enable you to see exactly what’s happening with your finances. That’s an easy way to track your progress or to see if and when you may be heading in the wrong direction. And if you are, you’ll have an opportunity to correct the situation and get back on track.
If you can start saving early – or at least start saving the right amount each month – you really can become a millionaire. All you need is determination and the right tools.
Have you ever thought about what you’ll need to do to become a millionaire?
Kevin @ Savvy on Credit says
This article provides some interesting insight, but overlooks the biggest challenge to accumulating wealth in the U.S. – when families fail to stay together. Divorce is a great destroyer of wealth, and impacts half of all households.
I attended a wonderful marriage conference this weekend: Love and Respect. The most important building block to becoming a millionaire is a rock solid marriage. Invest in your marriage before any get rich quick scheme, or stock.
God hates divorce, and this is one of the many reasons.
Daisy @ Everything Finance says
I’ve considered what it would take, but then came to the sad realization that a millionaire isn’t THAT well of these days. A few million can do a lot less than than it could even a couple of years ago. Obviously it would still be nice to have a few million dollars in the bank though :)
DC @ Young Adult Money says
I think owning income-producing assets is a “quicker” way to becoming a millionaire, but it requires first saving the money to purchase those assets, or the time to develop them. There is no real “get rich quick” scheme that will work for the masses, as infomercials advertise. I agree that becoming a millionaire takes time, patience, and discipline.
My answer is yes! Just start learning the art of making savings! You’ll get there!:)
Brandon Wilkins says
When it really boils down to it, one can build wealth and become a millionaire following a simple 3 step formula:
1. Debt Reduction (Don’t owe anybody)
2. Expense Management (Spend less than you make)
3. Multiple Income Streams (Make your money from more than one place)
The good thing is you can work on one at a time, all at once and in no particular order.
Terry Pratt says
Is it possible to become a millionaire with a minimum wage income? If not, what is the minimum income required?
Peter Anderson says
I suppose it depends on a lot of factors like how early you start saving, what kind of expenses you have, and how much you’re able to save. For example, here’s how much you’d need to save per month to have one million by 65, starting at 25:
Age 25: You need to save $286 per month to reach 1 million by age 65
Age 35: You need to save $671 per month to reach 1 million by age 65
Age 45: You need to save $1,698 per month to reach 1 million by age 65
Age 55: You need to save $5,466 per month to reach 1 million by age 65
I think now days, a million isn’t that much anymore-not that I don’t wish I had a million dollars just sitting around. I like the comment below of the savings breakdown in order to become a millionaire. That is a good visual. I clearly should have started saving when I was 10….