Want to Become a Millionaire? It is Possible…
Since the global economic recession, a majority of people are giving savings and investments a higher priority. When it comes to monetary savings, the million-dollar milestone is still a dream for most people.
According to a recent CNBC survey, 31% or about one-third of Americans believe that for comfortable retirement, they need savings worth $100,000 to $500,000. 22% believe that the savings should amount to $1,000,000 or more. While 61% people believe that they are unlikely to hit the million-dollar mark, about one-fifth believe that they will make it to the milestone within the next 10 years.
2 Ways to Become a Millionaire
There are two ways to become a millionaire – the easy way and the hard way. The easy way involves being born in the right family! For instance, the Hilton Group of Hotels heiress Paris Hilton and Jamie Johnson of the Johnson & Johnson group. Or if you are extremely lucky, you may hit the jackpot in Las Vegas or win a million-dollar lottery.
Even if you are not extraordinarily lucky and don’t have a million-dollar trust fund to fall back on, you can still turn your millionaire dream into reality. But you will have to do it the hard way. This involves consistent savings, strategic investments and may be a late retirement. Although this road is longer, it will surely lead to financial security.
3 Rules You Need to Follow to Become a Millionaire
If you seriously want to become a millionaire, you need to remember three rules –
- Never spend more than you can afford
- Save some money every month without fail
- Diversify your investment portfolio to include a mix of bonds, stocks and alternative investments like Gold and other precious metals
To hit the million-dollar mark by 70 with a starting investment of $10,000 and the annual portfolio growth of 5%, your monthly savings should be:
- $4,000, if you are 55
- $1,700, if you are 45
- $850, if you are 35
- $450, if you are 25
Moral of the story…start saving earlier!
Considering 3% inflation rate, 15 years from now, the worth of your million-dollar nest will only be $642,000 in today’s dollars. This means that to become a millionaire after beating inflation, you will have to save even more. But the bottom line is that with an early start and consistent savings, you can turn your dream of becoming a millionaire into a reality.