Dare to dream big! You may be aiming to become a millionaire — and you may even accomplish that goal. But what if you aimed to become a multi-millionaire instead? For many people that goal may be out of reach, but for many others among us, it’s surprisingly possible.
Here are five steps you might take if you want to work toward that ambitious goal of multi-millionairehood.
No. 1: Plan to become a multimillionaire
First off, develop a plan. Crunch some numbers. See what’s possible. Long-term money is likely to grow most briskly in stocks, which have averaged close to 10% in annual gains over many decades. You’ll likely only be investing for a few decades (or less), though, so you may average less — or more. To be a bit conservative, the table below shows how much you might amass over various periods with an 8% average annual gain.
|Growing at 8% for||$10,000 invested annually||$15,000 invested annually||$20,000 invested annually|
Clearly, you may be able to amass a lot of money — if you can invest it and let it grow over many years, and if you can sock away some hefty sums year in and year out.
By the way — if you’re looking at the table above and your own situation and you’re concluding that you’re never going to achieve multi-millionairehood, you can still do quite well just by achieving say $500,000 or $750,000 or $1.2 million. The tips below can help you make your future more financially secure, no matter whether you become a millionaire or not.
Also, spend a few moments looking at the table and thinking about your kids, if you have any, or any young people you know and care about — because it’s likely to be far easier for them to achieve multi-millionairehood if they begin now. If they’re 25, for example, they can likely achieve it by age 60 or earlier, socking away less hefty sums than you’d have to save.
No. 2: Save aggressively
Speaking of hefty sums, that’s what you’re probably going to have to invest regularly if you want to grow a really big nest egg. An old rule of thumb is saving 10% of your income, but that would be just $7,000 of a $70,000 income, a sum not likely to make you rich anytime soon. That 10% rule is especially insufficient if you’re way behind in your saving and investing for retirement, as so many Americans are. More than a third of those 55 and older have saved less than $100,000, and about 60% have saved less than $250,000, according to the 2019 Retirement Confidence Survey.
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