Have you ever dreamed of becoming a Millionaire? I hope so. If not, it is time to start. Every goal starts out as a dream. Being a Millionaire is possible. You need a plan, an understanding of the amount to invest, an automatic system, time and continued focus. YOU CAN DO IT!
If you are thinking where to begin, look no further. First, follow my Net Worth Plan. This simple 10 step plan will put you on a path to financial success. This plan will provide you with a clear picture of when to save for an emergency fund, pay off debt, invest and etc. Calculating your Net Worth is the first step in my plan. This will give you a clear picture of your financial health. Also, this will start you on your journey to financial independence.
Second, you will need to understand how much you need to save or invest on a monthly basis. Review the following chart for a financial breakdown:
For a printable chart click on Millionaire By The Numbers.
Bank Rate’s Investment Calculator provided the calculations above. Bank Rate has multiple calculators for retirement, investments, mortgages and so on. I often play around with all different calculators to see how numbers work. For example, I use the compound interest calculator to project how my money will grow year to year. This motivates me to save more and hopefully it will do the same for you.
The chart above shows the difference in monthly savings to reach $1,000,000 by age 65. A 35-year-old will have to save/invest $706 per month while a 45-year-old will have to save/invest $1747 per month. As a result, a 45-year-old, waiting 10 years to invest, will have to save approximately $1,000 more per month. Therefore, you will reach your goals sooner the earlier you begin.
Third, automate your savings and/or investing. Decide the amount of money you plan to save or invest per month and which account(s). A retirement account, savings account and mutual funds are examples of places to save or invest. Your paycheck or bank can transfer your allotted money to the desired account. Therefore, your money will automatically be sent.
An automatic transfer will be a valuable tool toward becoming a Millionaire. For example, if your bi-weekly take home pay is $1,000 and your bank automatically transfers $100 to your mutual fund, there will be $900 remaining ($1,000 pay – $100 automatic investment = $900). You will now have $900 to spend on bills and other expenses. Your $100 automatic investment will turn into a $2600 investment in one year ($100 x 26 bi-weekly investments = $2600).
Finally, your goal of becoming a Millionaire will take time and continued focus.
It won’t always be an easy decision. Occasionally, you will wish you had the money right now for going out to dinner, buying a fancy car and other day-to-day financial decisions. Hence your automatic system. When you look back 3 months, 6 months, 1 year and 5 years from now, you will be proud of the progress you made.
My wife and I follow the Net Worth Plan. We were able to increase our Net Worth to over $1,000,000 in 10 years. Once our automatic system was set and after a paycheck or two, we learned to live on the remaining income. Consequently, when we saw ourselves winning financially, many of our financial decisions became easier.
In addition, as a swim coach and personal financial coach, I often notice that when someone is starting to realize their goals, they become more motivated to succeed. This is true for me too. When I saw my retirement accounts growing and my goals coming true, I was inspired to find a way to increase my investments.
YOUR MILLIONAIRE ACTION STEPS
To become a Millionaire follow the action steps below:
1-Decide that you want to be a Millionaire
2-Conquer each step of the Net Worth Plan
3-Use the Millionaire By The Numbers document to see how much you need to save/invest
4-Make your savings/investments automatic
5-Work hard and stay focused
In summary, you can become a Millionaire too but not by just thinking, wanting or wishing it. It will require hard work on your part, using my plan, making your savings/investments automatic and staying focused!
