There are thousands of millionaires who live among us, and most people can make it big with little effort. The secret is not the amount of money you make; there are many people who earn more than you or I do yet they are not happy with their lives. It is the way you handle money is an important factor that will determine if you will ever be able to become a millionaire.
There are many ways to become a millionaire and in reality, if you put in the hard work and determination you will see that the path may seem difficult but it is possible. Here we provide you with top 10 ways that we think we can help you become a millionaire.
BE BRAVE AND TAKE RISKS
Most of the people who have become millionaires are entrepreneurs and they are the ones who never hesitated to take risks in their business and life. To become a millionaire, first, you have to start your own business, if you are brave enough to start up a business, then that will be a great step which takes to the path where you end up as a millionaire. Not that starting a business is enough to become a millionaire, the most important thing is you have to be successful in your business and that completely depends on the way how you run your business. You have to learn more about your business to spend long hours and have to work hard to lay a better foundation for your business. Therefore, it is very important while deciding your business choices. Go for the one which you know very well and in which you are confident that you can stand and run the business. Incorporating innovative ideas in your business will help you to lead the business in a profitable way.
Whether it’s money, love or life in general, if you want rewards, you have to take risks.
When it comes to money, taking risks means investing in things that can go down in value — like stocks, real estate or your own business. Can you get through life without taking risks? Sure, but as my dad was fond of saying, you’ll never get a hit from the dugout.
Riskier investments typically offer the chance for higher returns. And that extra return can make a world of difference to the size of your nest egg. If you invest $200 a month over 30 years and earn 12% annually, you’ll end up with hundreds of thousands of dollars more in retirement savings than if the same investment earns just 2% per year.
Taking a measured amount of risk is the difference between getting rich and getting by.
That being said, making risky bets is simply gambling. Take measured risks. Minimize risk by knowing as much as possible before investing, not putting all your eggs in one basket and learning from your mistakes. Or better yet, learn from someone else’s errors.
Never spend more than you make, ever
When I was 10, I started cutting grass to earn money beyond my meager allowance. Minutes after earning my first buck, Mom was stuffing me in the car for a trip to the bank to open my first passbook savings account.
Fifty years later, priority one is still to put something aside from every paycheck and send out less than I bring in.
Of course, life being what it is, it hasn’t always worked out that way. But in general, getting richer every month is as simple as spending less than you make, and getting poorer is as simple as spending more than you make.
Avoid debt like the plague
Most people treat debt as if it’s a normal part of life. They divide it into categories like “good debt” and “bad debt.” They discuss it endlessly, as if it’s some mathematical mystery.
Debt is not complicated. Paying money to temporarily use other people’s money makes you poorer. Charging money to temporarily let other people use yours makes you richer.
Since paying interest makes you poorer, you only do it in two situations:
- When you have to in order to survive
- When you’ll earn more on what you’re financing than what you’ll pay to finance it
Unless borrowing is ultimately going to make you richer, don’t do it.
SAVE MONEY FROM YOUR EARNING
After reaching a standard in your business, starting saving the money by making changes in the financial plan, business needs and lifestyle. Instead of luxury things or luxury lifestyle, focus on simple and healthy living. By adopting these changes, you can surely take 25 to 35% of your income for your saving money. You should not get diverted in the halfway, as you may get enough of money and status in this stage itself but that is not what you needed, you have half a way to reach your goal, so by practicing serious saving plans you can avoid wasting money.
When you regularly put away 10% of your earnings, you soon become comfortable living on the other 90%. Many people start by saving 10% of their income and then graduate to saving 15%, 20%, and even more. And their financial lives change dramatically as a result.
Try to figure out the way how can you spend and how can you save for the future. And set your mind to be happy with what you have and what you can use.
Buy when everyone’s freaking out, and sell when everyone thinks they can’t lose
Rich people ring the register when the economy is booming, but that’s not when they created their wealth.
You get richer by investing when nobody else will: when unemployment is high, the market is tanking, everybody’s freaking out, and there’s nothing but fear and misery on the horizon.
The cyclical nature of our economy all but ensures bad times will periodically occur, and human nature all but ensures that when bad times happen, most people will freeze like a deer in the headlights. But downturns are the time you’ve been saving for.
If you think the world is truly ending, buy canned food and a shotgun. If not, step up. As billionaire investor Warren Buffett famously advised, “Be fearful when others are greedy and greedy when others are fearful.”See Also:2-Minute Money Strategy: How Should I Invest My Retirement Savings?
OVERCOME EXCUSES, IMPROVE THE CONFIDENCE
Actually, making excuses is one of the easy ways to escape from or to hold back from anything which you are interested. But this a mere useless, you should give space for these diversions, instead, you should find a solution to overcome those diversions or excuses. Be strong in your goal and learn where you are in your success path and plan yourself to go ahead.
For that, you have to find a way or solution to keep all your diversions and excuses aside. Overcoming those excuses is not very simple as to think but you can do if you give the first priority to your goal. To overcome the excuses, just identify them first and figure out the suitable solutions to get over them. A tight time schedule of work will power to reach the goal and confidence will definitely help to produce the targeted results.
You can either look rich or be rich
When I worked as a Wall Street investment adviser, I quickly learned that people who have tons of money most often don’t look like it. They don’t have to.
So, who are the big shots wearing the fancy suits and driving the Porsches? Often it’s the people who make a living selling stuff to the rich people.
I can’t remember the last time I wore a fancy suit. I’ve never owned a new car, and I live in a house that’s worth about one-third of what I could afford.
Diverting your investable cash into things like cars, clothing, vacations and houses you can’t afford will make you look rich now, but prevent you from actually becoming rich later.
Live like you’ll die tomorrow, but invest like you’ll live forever
You should always strive to get as much out of life as you can each and every day. After all, you could die tomorrow.
But here’s the thing: You probably won’t. Put something aside so you can continue soaking up what life has to offer for as long as possible.
There are only 6 ways to get rich
The only ways to get rich:
- Marry money.
- Inherit money.
- Exploit a unique talent.
- Get exceedingly lucky.
- Own or lead a successful business.
- Spend less than you make and invest your savings wisely over long periods of time.
Even as you’re aiming for any of the first five, practice the last one and you’re guaranteed to become rich eventually.
EARN A LOT OF MONEY
The main key to becoming a millionaire is to earn more, by earning more your financial level will increase. Earn more is not an easy task, with 100% of a work dedication, innovative ideas for business and marketing and sacrifice will surely increase your income that too within a few years of time. Earning more is important but saving more is also important because it will help you concentrate on making more revenue by elevating your business and also by starting some sister business relating to your main business. Definitely, it will take time to build up your own business, however, developing in a gradually way will provide a strong foundation.
Never make your well-being someone else’s responsibility
If you need surgery, you have little choice but to trust your fate to a professional. But when it comes to your money, don’t ever turn over complete control to anyone.
Seeking advice is always a good idea. But no matter who that adviser is or how smart they are, your money is more important to you than it is to them. So, if you’re not doing everything yourself, at least understand exactly what’s going on.
Virtually anyone can learn to navigate their finances. If you can’t be bothered to take responsibility for your own money, just keep it in the bank. At least that way you won’t end up ripped off, broke and blaming someone else for your problems.
When it comes to information, less can be more
About 15 years ago, I put about $2,000 into Apple stock. I sold half of it a few years ago, then sold a little more a couple of years ago. But as I write this, my remaining shares are worth hundreds of thousands of dollars.
Had I been watching financial news every day and reacting to pundits and market gyrations, I’d have sold it all long ago and been kicking myself today.
If you want to be rich, buy into high-quality stocks and hold on to them for long periods of time. If you want to kick yourself, buy into high-quality stocks, then sell them at the drop of a hat based on something or someone you saw or read.
Time isn’t money, money is time
Whoever said “Time is money” had it backward. Time is the one nonrenewable resource you have. Once your time is up, it’s up.
So, the trick is to spend as much of your limited time as possible doing stuff you want to do, rather than working for other people doing stuff you have to do. Money is the resource that allows you to do this.
If you go to the mall and spend $200 on clothes, that’s $200 you could have invested. If you’d earned 12% compounded annually on that $200, in 30 years you’d have accumulated around $6,000. Ignoring inflation and assuming you could live on $3,000 a month in retirement, forgoing those clothes today means retiring two months earlier.
Of course, you must have clothes. But maybe you don’t need $200 worth, or maybe you could have gotten them for less.
It’s your choice: stuff today or time tomorrow. Those who choose the former often stay poor. Those who choose the latter often get rich. Which will you choose?
INVEST THE MONEY WISELY
Investing is the right way to earn from your savings. Here again, you must be ready to take risks as in the beginning but their time you have more clarity as you can figure which type of business or investment is right for your business ad or your growth. Learn how to reinvest the profits in the business.
You can invest your savings or profits in various business sectors that related to your main business like if your main business is oil refining then you can invest your profits in business related to raw materials used for oil refining business or you can extend your business geographically, national to international and so on.
But before making all reinvestments, you must study the stock market or business market thoroughly as some may provide compound interest for your investment. The type of investment may help you to earn a good amount of revenue.
Depending on the business type, owner’s talent, profit margins, and work put forth a business after 5 years could make any person a millionaire. Even though there are other paths to achieve this goal buy this one of the best-researched ways with the probable chance of achieving that in 5 years
Never operate at a loss.
The most simple step toward building wealth that people struggle with is spending less than they make. It might seem ridiculous, but it’s the truth — many people spend more than they make and float the difference on credit cards. They assume they will make more in the future and that it will all “even itself out,” when in reality, the moment they start making more money, the more they spend.
The bad habit stays, and they continuously operate at a loss.
Related: Brittney Castro: Schedule a Date for You and Your Money
Place a tax on yourself.
If the government suddenly increased taxes and forced you to pay an extra $100 each month, you’d find a way to pay it. You would have to. Yet when it comes to saving money, people constantly find ways to rationalize their inability to sock away $100 each month.
Set up an automatic bank transfer so that as soon as you receive your paycheck, a small portion of it immediately goes into your savings account. You should pretend it doesn’t even exist. And a few years from now, you’ll thank yourself.
Open an IRA account (to accumulate interest tax free).
One of the best things a young person can do is open an IRA account, which can double as either a primary or secondary savings account. The intention here, however, is that money is not touched until much later in life. If you withdraw from it before the age of 65 you are penalized. The bonus, though, is that your money in an IRA account can grow tax free, which compounded over three or four decades ends up being a lot of money.
Don’t play the stock market.
Unless your day job is trader, don’t try to time the stock market. Don’t think you’re smarter than the stock market. Don’t think you know which stocks are going to do well and which ones are going to do poorly. To think that you can do casually what some people make their entire careers is naive and reckless. At best, it’s gambling.
Instead, invest a portion of your money that you’re willing to lose in companies you like and want to hold on to for years to come. It’s best if you make these decisions with a financial advisor, and even better if you purchase these long-term options inside your IRA account. That way, your gains remain tax-free.
Build a side hustle.
Even the world’s most successful entrepreneurs have side hustles. According to Warren Buffet, the average millionaire has seven sources of income. Having multiple income streams is just part of the process.
The best thing you can do is figure out what you can provide or offer people that delivers true value. A perfect example is internet famous entrepreneur Sam Ovens, who has made millions selling online courses and consulting business owners.
Related: 5 Reasons Why Most People Don’t Become Wealthy
“The big lesson I learned is that you have to sell something that the market actually wants,” he told The Epoch Times. Simple, but that’s how it should be.
Bonus: If you can refrain from spending your side hustle money and save it instead, you’re in remarkable shape.
Always pay off your credit cards.
No matter how entrepreneurial you are, maxing out your credit cards without reliable streams of income to pay them off in a timely manner is irresponsible.
You always want to make financial decisions based on what you’re currently making, not what you think you’re going to make. Wait until you’ve got the money in the door before you go reinvest or spend it. Otherwise, you’ll find yourself drowning in interest payments.
Set financial goals at the start of each quarter and year.
When you have a goal, you tend to be more responsible with your money. It’s when you don’t have a goal that it’s much easier to rationalize spontaneous purchases.
At the start of each year, set a big goal for yourself and then break that goal down into three-month increments (quarters) so that you can check on your progress as you go along. These smaller goals are what help the larger one seem more attainable, and will give you a sense as to whether you’re on the right track along the way.
Follow the 50-30-20 rule.
Summarized in a great article by Nerdwallet, many financial experts suggest that 50 percent of your income should be spent on needs (such as housing, car payments, food, etc.), 30 percent should be spent on what you want (clothes, nice dinners, etc.) and the remaining 20 percent should be saved.
Especially when you’re young, you’re most likely going to operate closer to 70-20-10, living off 70 percent of your income, spending 20 and saving 10. If you can even follow that, you’re in good shape. But your goal should be to work toward following the 50-30-20 rule.
Related: 4 Steps People Who Weren’t Born Rich Can Take to Get Rich
Surround yourself with financially responsible people.
Nothing breeds financial success like hanging out with people who have already attained it. This means finding people older than you that you can learn from and also making sure that your group of friends is comprised of people who share similar financial goals. It can be difficult to adhere to financial disciplines when you’re spending time with spontaneous spenders.
A great way to learn about the art of finances is to find a family friend who can mentor you throughout the process — someone who has achieved their own financial success. If you show an earnest interest in learning how to build the same for yourself, chances are someone will be happy to help. A willingness to learn goes a long way.
Conclusion
Becoming a millionaire is your biggest dream. If you have a passion for business and a little bit of a financial knack, it’s possible to do so in ten years. But to help you on your way, we have brought for you five ways to become a millionaire, all of which are perfectly achievable. Good luck!