6 Ways to Become a Millionaire
Becoming a millionaire is a popular wish. Do you want to have a million dollar net worth? Only those readers who are already there would say no, I bet.
It is entirely possible to become a millionaire. Some ways are faster and less likely, others are slower and surer. Here are 6 proven ways to become a millionaire, meaning that people actually have gotten to a million in net worth using these methods.
Win two million in the lottery.
You have to win two million to cover the state and federal income taxes with one million of the winnings! Of course the chances that you will win millions in the lottery are well known and horrible.
Inherit a million.
Do you have rich parents, in-laws or aunts and uncles? If so, this might be an option for you, but don’t count on it baby. We are all living longer, but not necessarily healthier. Old age health issues will soak up a lot of that wealth and re-distribute it (and not to you!).
Nurture your special talent.
Some folks are blessed with the perfect body, mind or personality to accomplish specific things such as becoming a star basketball player, an Olympic skater or a famous dancer or singer. Even so, it takes practice, persistence, smarts, luck and hard work to turn that special talent into a million dollar net worth.
Start and grow a business.
According to Forbes article, How to be a Millionaire this is the best way to create a million in net worth for yourself.
To build a winning business, though, you must out think, out hustle and out leverage the competition. Building a business takes time, money, hard work, continuous learning, and persistence. To really grow your business, you most likely will need to move beyond the point where you are the only person involved and it is just supporting your lifestyle. You need to leverage your time by building systems, hiring people and more.
Jamie, over at Eventual Millionaire, has interviewed many millionaire business owners. Take a listen to see what their success tips are.
Use leverage (time or money).
If you trade time for money (1 on 1) it takes much longer to build your net worth. Putting two people in the household out there earning money is one way to leverage time (as long as you can continue to live mostly on one salary and invest the other).
Using a unit of time to create multiple units of wealth is another way to leverage time. If you can create something once and get money from that one thing multiple times, it leaves you free to continue to use the rest of your time in other ways.
If you can use someone else’s money and put it to work for you, you might be able to build net worth faster. Of course, leveraging money is a risk – you could just as easily subtract from your net worth if you lose the money.
So, write a book and sell it over and over. Buy a rental property and receive rent over and over. Make a product and sell it for more than it costs.
Save and invest.
Seek a highly paid career and train for it. Stay out of debt. Save regularly.
I know of a 39 year old software engineer who is three fourths of the way to a million dollar net worth I know of a 28 year old accountant who is probably at least half way there. Both are currently being helped by the rising stock market, because they had saved enough to invest when during the great recession!
For most, though, life gets in the way of saving. However, no matter what your salary level, if you save and invest you will be well on your way to a million dollar net worth by middle age, if you are persistent enough. You have to persistently save, persistently put the savings where they will earn more and persist over time to meet your goal. It is possible, but not easy for most people.
CNN Money agrees that it is possible, in their article Save your way to $1 million. They advocate using a savings method called ‘burst’ savings where you rapidly build savings each time you get a minor or major windfall – such as a bonus, gift or inheritance. In addition, they report that a key move is to save at least 15% of your income for a 10 year period as well as keeping your bigger expenses under control (think saving for college or buying a house).
What can you share about your journey to increase your net worth. Which of these methods have you used? What other ones do you know of?