Are you looking for a solid plan to help you become a billionaire in 5 years or less? Before we get into the steps to becoming a billionaireTo become a billionaire in five years, you must come up with a plan for how you’re going to do it. Here we will discuss the steps that billionaires take in order to become really wealthy and what they do to enjoy their fortunes and maintain their positions in the world.
As it turns out, the amount of money you need to become a billionaire varies depending on who you ask and what their definition is. For example, personal finance guru Suze Orman often speaks about the magic number “$1 million dollars” – and it’s easy to see why.
Be Willing to Sacrifice
Becoming rich comes with a lot of sacrifice. You would sacrifice whatever little capital you have, your time, family life, leisure, holidays etc. If you are not ready to lead a life of sacrifice, at least for now, then forget about being a millionaire.
Before you become rich, you must become poor. This is a verified fact. There will be many times where you will have to delay gratification to focus on a bigger goal, which is always worth it in the end. Learn to close your mind to immediate gratification and focus on the bigger picture.
Your business should always come first before anything else, and any activity that has to compromise even a single sale should be shunned. Remember 5 years is almost around the corner, so you should make the best of every of hour, minute and second it provides.
You Want to Be Rich? Move with the rich
This is a proven fact of life. You cannot attract wealth by keeping company with poor people. All that negativity and the borrowing tendencies won’t do jack for your finances. And what about the inspiration factor? It’s nearly zero with poor people.
You need to know what people are doing to create wealth and follow their example. You need to start thinking, acting, moving and reasoning like a rich person, and you cannot learn all these by hanging out with people that don’t give you the desired inspiration.
Instead of playing basketball or football in the evening with local kids, why don’t you go to a golf course and just watch, or visit luxury car dealerships. In fact, you need to find ways of making millionaire friends, and you can only do so through this medium.
Shift Focus from Spending to Investing
The rich don’t spend money; they invest. They know the U.S. tax laws favor investing over spending. You buy a house and can’t write it off. The rich, in contrast, buy an apartment building that produces cash flow, appreciates and offers write-offs year after year. You buy cars for comfort and style, the rich buy cars for their companies that are deductible because they are used to produce revenue.
You need to make every cent that comes into your till count. It has to be put in somewhere productive. You must never buy for pleasure, instead buy what is an absolute necessity of life. You have to draw up a plan of which percentage of your profits to plow back into your business, and which percentage to invest into other things. This schedule is a must if you want to make the 5 year mark.
Create Multiple Flows of Income
The really rich never depend on one flow of income. They instead create a number of revenue streams. You may find it extremely challenging to become a millionaire in 5 years with just one income source. Look for viable sectors and invest in them. Invest in real estate, stocks, technology; buy over businesses when you can afford it, go into retail – just do something extra. These little streams of income get to add up to a lot in the long run.
Re-invest your Income
The worst you can do in your drive to become a self-made millionaire is to spend your profits. All profits from your business must be re-invested back into the business in order to help your business grow. Forget the fast cars, smart suits, fine wine and all that goes with it. If your business grows to an extent, then you should start expanding. Make sure every little profit you earn from the business goes somewhere productive.
One other habit you need to ditch is the habit of saving money in the bank. Every money that you need to save has to go towards an investment no matter how small the cash or the investment. A man’s net worth is measured based on his assets and not cash at hand because cash is ephemeral.
Track your Spending
You can never build wealth if more money is leaving your wallet than is coming in. This is especially true for a salary earner who aims to become a millionaire. To ensure you are earning more than you are spending, track your daily expenses, and let go of very unnecessary things.
Take for instance, if you are one that cannot do with your daily morning coffee, learn to make yours or buy an efficient coffee maker so as to save up on the daily $5 you spend on coffee.
11. Don’t Aim for $1 million, Aim for $10 million
Do you require motivation? Then this is it. Never aim for what you can get, aim for what is above your reach. When aiming to be a millionaire, you need to find an effective motivator because it would dust up your thinking faculties and put your brains to work. Instead of ending your life in retail or sales, it would make you aim to own the company. When becoming a millionaire, motivation is everything, so you should never limit your capabilities.
Save until it hurts
I was once a poor college student, so just landing a job with any consistent salary made me feel rich. But I continued living like a student for years even after my first full-time job. It took a lot of willpower and discipline to save as much as I did.
I didn’t make excuses as to why I needed nice clothes or a new car. I shared a tiny studio with a friend for two years to keep my living costs low. That allowed me to max out my 401(k) on a modest salary and also save another 20% of my 401(k) cash flow.
Try to save at least 20% of your after tax income every year, no matter what. Remember, if you’re not in pain from the amount of money you’re saving each month, you’re not saving enough.
Work hard and know your place
Working hard takes absolutely no skill. I promise that if you’re the first person in the office and the last to leave, you’ll get ahead. Pay your dues early and you can relax when you’re older. Will your social life suffer? A little bit, yes. But you’re young, remember? Your energy is limitless!
Early in my career, I got to work at 5:30 a.m. and left after 7:30 p.m. I learned a lot, got more done and gained the respect of my peers. And because my boss recognized my hard work ethics, I was able to save my job during the 2000 dot-com bubble burst.
Consider both aggressive and conservative strategies
Investing in an S&P 500 index fund is fine, but if you want to get rich fast, I recommend making more high-risk bets. You can land bigger wins for a small portion of your portfolio.
Don’t go crazy and blow all your money away, but be willing to experiment with aggressive investment strategies. Like I said, when you’re young, you have very little to lose.
When I was 22, I only had about $4,000 to my name. Regardless, I invested 80% of my money in one stock and got a 5,000% return. Part of it was luck. But I did my research, took a big risk and it paid off.
Make property your best friend
Inflation is a beast. Make it a goal to own a primary residence as soon as you know where you want to live for the next five to 10 years. If you put a 20% down payment on a home and it goes 3% up per year, that’s a 15% return on your cash.
At 26, I used the lucky win I made from one stock investment and bought a two-bedroom, two-bathroom condo in San Francisco for $580,500. The mortgage has since been paid off and the property now generates a steady stream of income.
Live like you’re poorer than you actually are
The richer you become, the more frugal and low-key you should be. Too many young people waste money on things they don’t need — simply to show off to their friends or on social media.
There’s no shame in being young and poor. Drive a cheap car. Live in a modest home. Don’t eat out every day. Don’t buy clothes you don’t need (thanks to Mark Zuckerberg and Steve Jobs, wearing the same thing every day is cool). And then be the unassuming millionaire next door.
Once I became a millionaire, I purchased a six-year-old car and drove it for the next 10 years. After that, I leased a Honda Fit and drove it for three years. I still wear the same casual athletic clothes I wore in my 20s.
Start a side hustle
You can make money by working a full-time job or by starting a business. Better yet, you can do both. Over time, your side hustle might turn into a big business that will generate even more income than your full-time job.
In 2009, I launched Financial Samurai as a way to make sense of all the financial chaos. Little did I know that the site would grow so big and so fast. It gave me the confidence to negotiate a severance in 2012 and leave my full-time job for good.
Build a strong support network
To get ahead, you’ve got to build as many allies as possible. Being a hard worker isn’t enough. You have to talk to people, show an interest in them and get them to like you.
Once you have someone with significant power on your side, your entire career will advance much faster. I always made it a point to take a colleague out for coffee at least once a week. Building deep relationships helped me get promoted to vice president at 27.
Invest in your education
Your brain is your greatest asset. A strong education is the most valuable thing you have, so keep expanding your knowledge — even after college. Thanks to the Internet, you can now learn almost anything for free.
After completing my part-time MBA program, I continued taking courses to stay up to date with everything finance-related. That also fueled me to keep writing on Financial Samurai — and the more I did, the more money I made.
Become Financially Educated
Schools teach you many things. But, they don’t teach you how to become financially free.
If you want to become a wealthy millionaire and stay that way, understanding money is essential.
That’s why so many rappers, singers and sports stars can make millions and still end up broke.
They dedicated their lives to mastering their craft. But, they never learned money.
What you’ll need to learn
If you want to know how to become wealthy in 5 years, you’ll need to learn the following:
- How to read profit and loss statements and other financial forms
- The rules of Tax
- The difference between assets and liabilities
- How to improve your credit
- the difference between good debt and bad debt
How to learn about money?
Fortunately, their many ways you can learn about money. Here are a few of my favorite ways.
Read Books
There are hundreds of excellent books written by millionaires, billionaires, and successful leaders; which will teach you so much about money.
Russel Brunson is the founder of ClickFunnels and the author of a few awesome books. Over the last few years, Russel has helped millions of entrepreneurs and has sold thousands of copies of his books.
Expert Secrets is a must-read for any entrepreneur, business, or literally anyone looking to make money in this modern world.
The best part is, it’s FREE! Just cover the shipping cost. Grab your free copy.
Take Courses
If you want to step up your financial education, take online courses.
Find a Wealthy Mentor
Who better to learn from than someone who has what you want?
Your friends can provide you with great support; however, unless they happen to be wealthy millionaires, they won’t always have the right answers or attitude.
A mentor is someone who understands what you’re going through. They will understand your ambition, and they can inspire you.
They can also help you to build a wealth plan and help you stick to it.
How to Find a Mentor
Finding a wealthy mentor can be tricky. But, it’s worth the effort.
First, write a list of people you know that qualify for the position. This should be someone you respect, look up to, and of course, someone you call as wealthy.
Build a strong relationship before asking them to be your mentor.
Click here for some more tips on finding a mentor.
Remember, a mentor doesn’t have to be such a formal position. Instead of meeting in person, you could arrange a phone call, skype call or even send an email.
Maybe you only need to ask one question. Get straight to the point. Your mentor will respect you for not wasting their time.
If you’re new and looking for a quick mentor lesson to get you started, I recommend checking out the 5-minute millionaire money mentor. Watch the video below to find out more.
Click here to learn from the 5-minute millionaire money mentor.
Take Control of Your Finances
Wealthy people not only understand money, but they also take control of their money too.
Staying on top of your finances is crucial if you want to stand any chance of becoming a wealthy millionaire.
Here are a few things you need to be on top of:
- Earn More Than You Spend: It may sound obvious, but keeping a close eye on the bottom line is something that many buddy entrepreneurs & businesses fail to do. The more profit & cash flow you can create, the easier you’re millionaire mission will be.
- Expenses: To make money, you need to be able to keep the money. And, that means controlling your costs.
- Keeping Your Credit in Check: The wealthier you become, the more you’ll realize how important your credit score is. Keep a close eye on any debts & loans you have to ensure you’re credit stays healthy and available.
- Financial Planning: There’s a good reason why a bank will always ask for financial plans & books, before accepting you for a loan. It paints a picture of how clear your vision is, and how organized you are with money. Whether you need to borrow money from the bank or not, keeping financial reports is just good practice. Give yourself a plan with clear objectives and goals, and then stick to it.
Having organized financial books and accounts will come in handy, should the taxman ever come knocking.
If you need help controlling your finances, seek advice from a qualified financial advisor.
Save With the Intent to Invest
Store, store, store, and then Invest! That’s the motto.
If you want to become wealthy, you’ll need to make smart investments. To do so, you’ll first need to stack some money first.
To stick to this 5-year timeline, you’ll need to save intensely. However, in this case, we’re not saving for a rainy day, we’re saving to invest.
The key is to then invest your stored money on something that will earn you more money. This could be:
- Invest in Yourself: Courses are a way to improve you’re abilities & skills and can help to increase your income. Investing in your health can also make you more productive, which could lead to increased profits.
- Invest in Your Business: Buying more stock, hiring employees, and investing in marketing can all lead to an increase in money.
- Invest in Assets: Real estate is a popular investment that wealthy millionaires make to improve their cash flow.
- Invest in Stocks & Shares: Another popular option that the wealthy use to keep their money working long-term.
Suggested Read: Investments that will pay you a monthly income
Remember, big savings will result in even bigger earnings.
So, the faster you can save, the quicker you can increase your financial wealth.
Network With The Rich & Wealthy
Do you have any wealthy friends? Well, it’s time to find some.
Effective networking is something that the wealthy do exceptionally well.
Having a strong network is critical for gaining new customers, clients & business partners. You’ll also learn a lot from your network, which can help to increase your wealth faster.
How to Network?
Finding the right wealthy people to network with is the hard part. Here are a few strategies you can use:
- Join networking groups & clubs
- Reach out to people via LinkedIn
- Go to charity events (wealthy people are usually quite generous)
- Hang out at popular spots; such as hotel lobbies & golf courses.
It’s not what you know; it’s who you know.
If you want to become wealthy in 5 years, the truth is, you’ll need both.
Multiple Sources of Income
Most millionaires will have multiple streams of income. This is for two good reasons.
The first being the more money you earn, the richer you will become. But, that’s obvious.
The second reason is all about protecting your cash flow.
You may have heard the phrase “Cashflow is King”
Having steady cash flow will mean you can pay incoming bills, save money, and invest money to make more money.
However, what happens when something happens to that steady cash flow?
Suddenly you can’t afford to pay bills, you have no money to invest, and therefore no new money will come in.
That’s why the wealthy focus on creating multiple streams of income. That way, if one flow is cut off, you have other streams still coming in.
In other ways, you’re never relying on one source of income.
How to Create Multiple Sources of Income?
Having multiple streams of income can sound impossible to manage. Fortunately, there is a simple solution – Passive Income.
Passive income is a secret that the rich & wealthy use to create multiple income sources.
Here are a few of the most popular passive income ideas:
- Rental income from real estate
- Dividends from stock & shares investments
- Businesses that are managed by someone else
- Affiliate marketing.
For more ideas for creating new income streams, check out this money making ideas:
- How Do You Make Money From YouTube?
- 11 Trustworthy Survey Sites to Make Extra Money
- 15 Easy Ways to Make an Extra $1000 a Month
- Make Money on Instagram With Clickbank
- Things to Buy That Will Make You Money
Learn Faster
I’m sure you’ve heard the phrase “Time is Money”
In this case, you’ll need to learn how to make money a lot faster than the average person.
According to CNBC, the average American earns $45,552 per year.
The faster you learn how to increase your income, the quicker you’re wealth will grow.
Here’s how to learn faster:
- Stop Procrastinating – One of the biggest mistakes people make is not taking action. If you want to become wealthy in 5 years, stop procrastinating & start putting these tactics into practice.
- Learn From Your Mistakes – In your attempt at becoming a millionaire, you will occur many mistakes. How quickly you can identify and learn from these mistakes will determine how quickly you’ll be able to find success.
- Learn From Other Peoples Mistakes – Use your mentors, wealthy friends & autobiography books as case studies. Learning from the mistakes of wealthy people can dramatically speed up your wealth.
Take Care of Your Health
What’s the point of having money, when you’re not healthy enough to spend it?
Taking care of you’re health & wellbeing will also help you to sustain the high level of energy required to become a millionaire.
Here are a few things you can do take care of your physical & mental health:
- Join a gym
- Take part in exercise classes i.e., boxing, running, swimming, yoga
- Meditate daily
- Eat a balanced & healthy diet
- Get regular health checks
Spread the Wealth
Now, you don’t need a lot of money to make a difference.
However, many wealthy millionaires contribute considerably to charities and good causes.
In 2017, Bill Gates (one of the world’s wealthiest people), donated $4.6 billion worth of Microsoft shares to the Bill and Melinda Gates Foundation. And, he continues to contribute generously to worthy causes around the globe.
Here’s the thing, wealthy people are not greedy. Nor, are they selfish. Most show immense gratitude and appreciation for their fortune.
You have an opportunity to impact the world in a positive way. Use it.
Conclusion
Becoming a billionaire isn’t that hard. What do I mean by that? If you have average intelligence, some basic discipline, and are willing to work for years on your startup business, it is definitely possible to become a billionaire. But if you have the specific goal of becoming a billionaire in 5 years or less, then it can be hard to know how to go about this. Just knowing where to start with your business idea can be tough enough without trying to figure out how to manage growing it quickly enough.