The Credit Suisse Research Institute recently released their Global Wealth Report for 2016. The report notes that the U.S. has 13,554,000 millionaires.
The best way to join the millionaires club is not by playing the lotto (the odds of winning the powerball are 1 in 292 million). Here’s the tried and true formula for becoming a millionaire, before I tell you I must warn you it’s boring but it will get you to the promised land. Okay here you go:
- Spend less than you make
- Commit to saving $5,500 per year, invest it in a low cost index mutual funds.
- Increase the amount you save by 5% each year i.e. $5,500 x 1.05 = $5,775 in year 2 and so on.
- Repeat this process for 30 years and you will have $1,136,661 (assuming an average 8% return on principle each year)
For some cool retirement and 401k calculators check out NerdWallet.
There you have it. The secret is yours my friends. Live within your means and save. Once you’ve got these basic principles down we can experiment in business and try to expedite this process.