To become a millionaire can be considered the pinnacle of the American dream. No matter your nationality, upbringing or education, our capitalist society offers everyone the opportunity to succeed and prosper – you just have to be able to put in the hard work.
A million dollar net worth is still considered a significant accomplishment and is sure to make you feel good, along with impressing your friends! Are you wondering how to become a millionaire? There are two very different strategies you can follow.
How to Become a Millionaire the Slow Way
Believe it or not, you can become a millionaire without winning the lottery, receiving a large inheritance or finding a lost pirate treasure. It’s actually quite simple – all you need is dedication and time. Provided that you do your best to secure a high-paying job and efficiently manage your money from an early age, you will become a millionaire in time for retirement.
The first part of this approach is maximizing your income. The idea is to pick a career path that allows you to earn as much as possible during your lifetime. Check out The 100 Best Jobs list from US News for some great examples. If your job isn’t on the list, you can always think about switching careers, finding ways to get promoted or doing side jobs for extra income.
The second part of becoming a millionaire the slow way is having good financial habits that help you build wealth. Some of the basics include:
- Creating a budget and living below your means
- Saving and investing as much as possible
- Protecting your wealth with an emergency fund and adequate insurance
- Investing your money wisely through low-cost, tax-efficient portfolios
If you got all of that figured out, then you are on the right track to become a millionaire. Don’t lose your focus and you’ll be fine. By the way, this is exactly the premise behind the widely popular book The Millionaire Next Door by Stanley and Danko. Give it a read if you want more advice.
The Fastlane to Becoming a Millionaire
The method above will work for many, but there are some among us (myself included), who are not willing to wait 20-30 years to become a millionaire. Is it possible to achieve this level of wealth in a shorter period of time? How about 5 or 10 years?
The answer is a definite yes, but it’s not easy. The key to becoming a millionaire that quickly is starting and growing your own business. While the principles of sound financial management above are great, a regular 9-5 is not going to be enough to build your wealth that quickly. Owning a business is the only way to exponentially increase your income to the levels necessary to become a millionaire in less than 10 years.
Not every business will cut it, either. Your company must have the potential to operate on a large scale by either having a huge (and growing) customer base, or by selling extremely valuable products or services (or both!). The owner of a local food truck may feel proud for being self employed, but his business can never achieve a large scale. He can only sell to a few customers per day and can only charge so much for the food.
On the other hand, an owner of an online company selling financial education courses has a great scale potential. While his individual product price may not be that high, he can theoretically sell his product to the entire population with internet access. His profits will only be limited by the quality of his product and his ability to market it.
MJ DeMarco’s The Millionaire Fastlane is an excellent read describing the fast method of building wealth. That book was my main inspiration for starting my own company (check out my review of it here)!
The Million Dollar Club
So are you committed to becoming a millionaire? Are you willing to put in the work, dedication and discipline and follow either the slow or the fast approaches above? Then make a pledge to The Million Dollar Club – an awesome project started by J. Money from Budgets Are Sexy.
Your pledge should contain a brief checklist of what you need to accomplish to become a millionaire. Spend some time on this and be specific. Here is my pledge:
- Achieve $100,000 annual income from my financial company
- Bring up my monthly investment contribution to $5,000 ($60,000 per year)
- Contribute an additional $5,000 to my emergency fund
- Continue growing and improving my equity and real estate investment portfolios
You can post your Million Dollar Club pledge in the comments, or on The Million Dollar Club page.