How To Become A Millionaire (It's Simpler Than You Think!)

8 TipsforBecoming a Millionaire

For The National Study of Millionaires, the largest survey of millionaires ever done, we talked to more than 10,000 millionaires from all across the country to learn more about who they are and what they did to reach millionaire status.

It turns out that most millionaires share similar habits and principles. And that means you can start building those same habits and following those same principles starting today so you can become a millionaire yourself someday! Here’s the list of million-dollar habits:  

  1. Stay Away From Debt 
  2. Invest Early and Consistently
  3. Make Savings a Priority
  4. Increase Your Income to Reach Your Goal Faster
  5. Cut Unnecessary Expenses
  6. Keep Your Millionaire Goal Front and Center
  7. Work With an Investing Professional
  8. Put Your Plan on Repeat  

There’s a whole group of millionaires called Baby Steps Millionaires who’ve lived out these eight principles and Dave Ramsey’s 7 Baby Steps to hit the million-dollar mark.



How much will you need for retirement? Find out

If you follow in their footsteps, you’ll be on your way to becoming a millionaire too! Are you ready?

3. Make Savings a Priority

If you’ve already started investing (Baby Step 4), way to go! When it comes to saving for retirement, the goal is to save 15% of your income into tax-advantaged retirement accounts like a 401(k) and Roth IRA. Not 5%. Not 10%. Fifteen percent!

Why? Because if you want to become a millionaire, how much money you invest is just as important as the actual act of investing. We found that it took Baby Steps Millionaires, who invested 15% of their income toward retirement, about 20 years or less to reach millionaire status from the beginning of their journey! Here’s how things would shake out:

The median household income in America is around $68,000.2 So let’s say you invested 15% of that income toward retirement, that works out to $10,200 a year or around $850 a month. Invested over 30 years, assuming an 11% rate of return, that money could turn into $2.3 million. And that’s pretending you don’t get an employer match and never got a single raise over your entire career (which is highly unlikely)!  

Our research found that 70% of millionaires saved more than 10% of their income throughout their working years.3 They saved, and they saved a lot! How were they able to save so much? That’s where the next two principles come into play.  

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The Habits Of People Who Become Millionaires From Nothing

So much about success boils down to mindset. People with a positive can-do mindset combined with sharp critical thinking and business skills can go far despite starting at zero. Here are some common habits of the self-made rich:

1. Have A Vision

Self-made millionaires have a clear vision of their life. A focus on an idea or business defines their life.

Instead of waiting around for the universe to do the work, they put in the hard work and take the steps to make their vision come true.

Take a look at your current life and write down what would need to change in order for it to equal your vision. Make small actionable steps every single day to work towards your goal.

Related: 100 Millionaire Money Mindset Quotes That Will Change Your Outlook

2. Surround Yourself With Supporters

Often, we surround ourselves with naysayers and people who keep you down because they’re familiar. But if you’re wanting to become something you aren’t, you need to surround yourself with people who are closer to or on their way there themselves.

These people will be supporters to you instead of discouraging your ideas, no matter how improbable they sound right now. Ambitious people feed off each other’s energy and can help drive you to action.

If you don’t have anyone in your life or near you who fit this then do the next best thing – read about them. Reading biographies of people who have done something similar to what you hope to accomplish keeps you motivated and in the right mindset.

You may even pick up glimpses of their business savvy that gives you ideas of your own. Focus on people who had an average life before their success; not someone who was born into wealth and privilege.

3. Be Selective With Your Time

Stop doing the things that won’t make you rich. It’s simple in theory but so much harder to do in practice.

While having hobbies and volunteering is good, if you find that all of your free time goes to these activities, it’s time to reassess. There are only so many hours in a day and if you don’t leave enough time to work towards your goals, you’ll get nowhere.

Always have an outlet for relaxing but perhaps you don’t need to spend 4 hrs playing video games or leisurely shopping every weekend. By redirecting even a fraction of that time towards something that makes you money, you’ll be much farther ahead.

4. Invest In Yourself

Investing in yourself can mean a few different things from schooling to mentorship. After you’ve made a plan with the steps you need to take to complete your vision and become rich, assess whether you have any gaps in knowledge.

If your vision is to start an online business but you don’t know the first thing about online business, then you’ll need to delve into that realm. While many things can be found for free, it often saves more time and energy to purchase training from an expert in the field.

5. Don’t Look For Quick Fixes

Get rich quick schemes are just that, schemes. If the money was quick to be earned, it’s also probably quick to be lost.

Building generational wealth takes time and is more stable when done with a series of tried and true investments. Stay away from unproven startups and investment “opportunities” from your buddies if you’re serious about building wealth.

Millionaires who started from nothing often found themselves with a passion and clear goal of what they hoped to accomplish. They focused solely on their goal and weren’t looking to take a shortcut.

6. Invest Your Earnings Wisely

Most millionaires invest in either real estate or the stock market, often both. Now before you start throwing your savings into either of these, it’s important to have a complete understanding of what you’re investing in.

Meet with a financial professional or immerse yourself in literature about either of these. Your goal is to gain a complete understanding of the investment vehicle you’re leaning towards. If you don’t understand it, hold off on investing in it until you do.

7. Always Keep Learning

Self-made millionaires never stop learning. Having a true curiosity about life and a desire to learn is what made many millionaires successful.

Don’t think this means you have to go to college. In fact, many self-made billionaires dropped out of college before finishing their degree.

No matter what field you want to enter, learn everything you can about it. Follow the experts who have proven success and learn from their early mistakes.

4. 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.

4. Shake your moneymaker

I don’t mean literally. That is, unless, you’re an incredible dancer. Rather, this means that if you want to become a millionaire and retire young, you have to, as Rihanna famously proclaimed, put in work.

The first place to start? Make even more money with your primary income source.

If you’re working a 9-to-5 position, maybe you could work overtime once or twice a month. Maybe you could earn a certification in order to land a raise or promotion. Or, you could even ask if there are any other responsibilities you could take on — ideally something that you’re already experienced or skilled at.

As for the self-employed? Well, this might be a bit easier. For example, let’s say that you own an ice cream shop. If you have the funds, you could invest in an ice cream cart or truck. If so, you could work events like birthdays or weddings. Or, hire someone to sell your products elsewhere while you’re running the actual business.

Another idea? Start a blog and monetize through affiliate links. Your blog could discuss anything from how to make ice cream to managing a small business. These topics could also be used to create an online course. And, you could even sell your swag online.

But, if you really want to hit it out of the park, you need to also find additional income streams. Some ideas would be listing a spare bedroom on Airbnb, ridesharing, freelancing, or dropshipping. Ideally, you want to hone in on passive income sources.

Related: Support Your Primary Business Venture with a Side Hustle

6. Live like youre 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.

4. Corporate Slave

Okay, this is the first way to be a millionaire while avoiding the headlines. Many high paid professionals end up with significant wealth over time. Of course, they get beaten up at work daily as they climb the corporate ladder and then pay obscene amounts of government taxes afterward, but hey, nothing is going to stop you from becoming a millionaire right?

Step 9: Resist the Urge To Spend Cash

Living well beneath your means is essential if you want to become a millionaire in five years or less. Besides making a realistic budget, you need to find ways to control impulse spending. Avoid visiting your favorite online shopping sites and stick to a list when going to the grocery store.

Also, look for alternatives before purchasing something new. If you have a broken computer, see if you can have it repaired before buying a new one. Maybe a family or friend has a used computer you can buy.

How Can I Become Independently Rich in 5 Years?

There are three steps to follow to become independently rich in five years.

  1. Budget and cut back on your expenses, becoming more effective with your money so you can keep more of your income.
  2. Save and invest as much of your income as possible.
  3. Find mentors and colleagues who will challenge you.

9. Create a smartphone app

Like I said, being a social media influencer can earn you millions. But did you think about the person that invented that social media platform and other such applications?

Creating successful, useful, and efficient smartphone apps is a common trend these days.

Those working on it are putting their everything into it and generating hundreds of thousands and millions of dollars.

These geniuses make money by selling their app to businesses or getting a profit every time someone downloads their application.

Either way, they become millionaires within a matter of days and weeks.

(Minus the time it took them to create that successful application)

How Do You Build Wealth from Nothing?

Another thing you’ve got to do is, every time you make money, put a portion of it into a savings account to not be spent. Even if you work a minimum wage job, it’s important to do this.

Saving one dollar is better than not saving anything. Being a self-made millionaire takes time. Even if you can save only a little bit out of each paycheck, that’s your first stepping stone to work your way up to saving even more.

Most financial advisors recommend that you save about 10 or 15 percent of the annual gross income you bring home. If you start early enough, you could retire at 60 years old with 1 million dollars.

Therefore, it’s important that you determine when you want a net worth of $1,000,000. If it’s primarily for retirement, you can easily attain that goal.

However, if you want to become a millionaire earlier, then it’s time to start saving every penny you can. The goal is to stop wasting so much money on little things (like that trip to the coffee shop every morning).

Analyze your purchases for the month to determine what you’re spending and find ways to lower them. This takes no money at all, but it helps you in becoming a millionaire.

Step 4: Save a Significant Portion of Your Earnings

You need to save a large portion of your income to accumulate a significant amount of wealth in a short period. Trim down your budget and live well below your means. Don’t take on extra debt, and don’t worry about the luxury items other people are buying. 

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Build a strict savings plan so you avoid wasting money on unnecessary items. Many people start by saving 10% of their income and then increase it to 20%. You’ll quickly find that you are comfortable living on a smaller portion of your income if you diligently track your expenses.

For example, assume you and your partner make a combined income of $100,000 per year, leaving you with about $80,000 after paying taxes. You’ll put $25,000 into savings each year if you save 25% of your income. The remaining $55,000 is enough to live on in many U.S. states if you reduce your housing expenses and eliminate debt.

Building Wealth

Your Employer’s Match Can Help Make You a Millionaire

Keep in mind that you aren’t in this retirement savings journey alone. An employer can match an employee’s contribution to a 401(k) or other retirement account, 85% of plans do, according to Fidelity.

Many employers match $0.50 for every $1 contributed by an employee, up to 6% of the employee’s salary. Some offer a $1 matching contribution for every $1 contributed by an employee. A benefit like this can easily add $100 to $200 a month to your total savings, which reduces the amount you need to save on your own to become a millionaire.

For example, let’s assume an individual making $50,000 a year is saving $450 a month to become a millionaire in approximately 40 years. If an employer matches dollar-for-dollar up to 6% of the employee’s salary, this benefit would add $3,000 a year (or $250 a month) to the employee’s retirement account.

If this employee continued to save $450 a month, the extra $250 a month employer match would enable the employee to become a millionaire in about 34 years rather than 40 years. And if they decided to continue working and contributing for 40 years, the employer match would grow their wealth to nearly $1.6 million.

7. Become a Social Media Marketing Millionaire

Gary Vaynerchuk runs a million-dollar social media empire. He teaches other people social media marketing tactics and helps them generate money online.

As kind and generous as that sounds, Gary makes a lot of money doing what he does.

He is currently an internet sensation with a million-dollar business standing upright.

Seeing his example, other people have started pursuing this career as well. You can start, too, if you have the knowledge and experience that it requires.

8. Invest in broadly diversified index funds

“Broadly diversified index funds can be your investment vehicle for a ride to becoming a millionaire retiree if the stock market performs as it has in the past,” notes Bankrate’s senior reporter James F. Royal, Ph.D.

“If you know little about investing and have no desire to learn more, you still can be a successful investor,” he adds. The reason? Index funds.

An index fund is an investment grouping of assets, such as stocks or bonds. And, according to Royal, they should have the following attributes:

  • Broadly diversified. Funds of this type invest in stocks from a broad range of industries.
  • Invested in stocks. Despite being more volatile in the short term, stocks offer the best long-term gains.
  • Low cost. The expense ratio of an index fund should be below 0.5 percent, so you can find a cheap, low-cost index fund.
  • Good long-term track record. Choose funds with annual returns of at least 10 percent over the previous 10 years. In many cases, returns can reach 15 percent.

It is these characteristics that you should seek if you want to generate great long-term returns.

Among the most popular index funds are those linked to Standard & Poor’s 500 – which includes hundreds of America’s best companies. “The best S&P 500 funds are also among the cheapest funds and may cost just a few dollars a year for every $10,000 you have invested,” he states. For the longest periods, this index has provided about 10 percent annual returns.

The Nasdaq composite index, which includes some of the world’s largest tech companies, is another good option. In fact, it regularly tops Bankrate’s list of the best mutual funds.

How Much Do I Need to Invest to Become a Millionaire?

The amount you'll need to invest to become a millionaire depends on where you are in your life. You can afford to sock away less money when you're younger because you have more time to accumulate your wealth and you can tolerate more risk. If you put off saving until you're older, you'll have to put away more money every month.

Surprisingly Simple Ways to Become a Millionaire

Simple tasks are not always easy tasks. If I were to hand you a spoon and ask that you dig a hole nine feet down into packed soil, that’d be pretty straightforward and simple but it certainly wouldn’t be easy.

Likewise, you’ll find some of these simple ways to be just that – simple but not easy. But come on, you’re tenacious enough for the job, right?

Jaime Tardy, author of Eventual Millionaire who has interviewed hundreds of millionaires has this to add , “One of the main traits of a millionaire is perseverance. The ability to KEEP GOING in the face of adversity even when the finish line is very far away.”

One last thing. Remember that many of these tips are surprisingly simple, don’t underestimate their effectiveness just because you’ve “heard that one before.” Put these babies to good use and watch your millionaire potential soar!

1. Work smarter and harder than your competition

Identify your competition. How hard are they working? What are some differentiators you can bring to your workplace or market?

Start by working smarter. There’s no use in working harder if your work isn’t effective at producing income – you’ll be spinning your wheels.

There’s no sense in selling ice cream cones on your front lawn in the dead of winter. Instead, set up a booth at the park in the sizzling summertime – you get the idea! Simple, commonsense changes can greatly improve your effectiveness.

Work harder than others are willing. We’ve all seen the guy or gal at the office who works harder than anyone else. Maybe they’re a little nerdy or a little too interested in their job – or are they?

Maybe they’re onto something. After all, aren’t they the ones getting the promotions? Aren’t they the ones who become the office linchpins?

I remember when began my career with A.G. Edwards & Sons in 2002, I was in a training class of around 55 people. After completing training a year later, our class was reduced to less than half. My fifth anniversary mark? Only five of us were left.

Most failed. Why? Because they weren’t willing to put in the hard work required.

I beg you to not be afraid of hard work. Not only will your boss feel better about what you’re doing for them – you will too.

I’m not afraid to die on a treadmill. I will not be outworked. You may be more talented than me. You might be smarter than me. And you may be better looking than me. But if we get on a treadmill together, you are going to get off first or I’m going to die. It’s really that simple. I’m not going to be outworked. – Will Smith, Actor

2. Learn from your mistakes and move on

Everyone makes them. I do, you do, we all do.

And believe me, I’ve made some pitiful mistakes.

Would you get suckered into two multi-level companies that go nowhere? Would you throw $8,000 into an online business venture only to lose it all? Those are just a couple of several investment mistakes I’ve made with my money.

Mistakes are difficult to swallow. I think our first gut reaction as human beings to the realization we messed up is to shift blame – to others or to circumstances.

The very best way forward is to admit we fumbled the ball. Are you willing to admit when you make mistakes?

Some people, when faced with their own inadequacies, beat themselves up. And you know what that does? It paralyzes them from making the decisions they need to make to achieve success.

It’s important to remember that . . . .

Only those who are asleep make no mistakes. – Ingvar Kamprad, Founder of IKEA

So, take the simple step to fess up and move on. Yes, it’s simpler than you think – especially once you have practice.  If you are still in the middle of a debt mistake one of the best things you can do is to stop paying interest by transferring your balance over to a 0% APR credit card.  This will free you up to hammer down on that debt instead of paying big interest payments.

Millionaires don’t give up because of a few silly mistakes. They press on toward the goal.

3. Build something new that you would love – and be sure to experiment

You can read book after book about how to research what your customers will love, and by the time you deliver it, they’ll already be bored with it.

If you’re the entrepreneurial type – I know I am – make sure to work on projects you can get excited about!

Chances are, if you create something that you’d use and love, others will too.

Millionaires understand that some of the best ideas don’t come out of costly research, they come out of a passion for making the world a better place.

Also, remember to experiment. Have fun! Some of my best ideas come out of experimentation.

In 1945, Percy Spencer experimented with a new vacuum tube while doing research for the Raytheon Corporation. He popped popcorn and melted a candy bar, and saw the great potential for this process which eventually culminated into the advent of the microwave.

Tim Cook, the CEO of Apple recently explained in an interview with Charlie Rose that it’s more difficult to edit than it is to create something entirely new. But I’ve learned that sometimes creating something new can be the best way forward to becoming a millionaire.

One of the things that I’ve been most excited about building  is my blog.  My financial planning practice was growing at a steady rate but after I launched GoodFinancialCents.com in 2008 my practice and revenue have grown significantly. Some of that is a direct result of getting new clients to my practice while the other more surprising revenue source has been directly from the blog.

A combination of advertising revenue and introduction to new business opportunities (because my name and face are all over the web) have been a huge blessing.

Here’s the thing you have to realize though:  I KNEW NOTHING ABOUT BLOGGING.

That’s right.  The launching of my blog was a total experiment and still is today.  I’m always testing different ways to monetize and build my brand.  Experimenting is the fun part!

You can’t just ask customers what they want and then try to give that to them. By the time you get it built, they’ll want something new. – Steve Jobs, Former CEO of Apple

4. Learn to budget – or at least get help doing so

You know that I hate budgeting. Thankfully, my wife budgets like a pro.

Here’s a tip from one of the financial greats (a millionaire, to say the least):

Rule No.1: Never lose money. Rule No.2: Never forget rule No.1. – Warren Buffett, CEO of Berkshire Hathaway

If you don’t budget, I promise you’ll lose money to overspending.

Want to make yourself sick? Count up how much you’re spending on eating out, clothing, gadgets, and other delights and write it down. Then, start budgeting. After a year, look at how much you’re spending and compare with your initial count.

Yikes. Try not to lose your lunch.

A hugely important part of budgeting is ensuring you’re spending less than you’re making. And the only way to do that friends, is to track everything.

If you’re not a spreadsheets-kind-of-person, that’s okay. Just make sure you have some help.

6. Don’t believe discouraging people

As soon as you accept that you’re not going to become a millionaire, you probably won’t – you’ll settle for the ordinary.

Your beliefs about your future matter a whole lot, and will – in part – help determine your future.

After all, your beliefs affect your actions, and your actions affect your outcomes.

When you listen to discouraging people, you’re letting them accomplish their goal – to drag you down and ensure you don’t surpass their success. No good.

Instead, I suggest you prove them wrong – but be humble about it. Your results will speak louder than your words, I promise you.

I just love it when people say I can’t do it, there’s nothing that makes me feel better because all my life, people have said that I wasn’t going to make it. – Ted Turner, Founder of CNN

7. Save some of your income for a rainy day

If you’ve lived on this planet for any considerable number of years, you know that bad stuff happens.

Not only that, sometimes several bad things happen all at the same time. Talk about knockout power!

That’s why I recommend that you save some of your income for a rainy day.

Medical emergencies can last years.

Trees go through roofs.

Jobs can be lost.

Don’t get caught without an emergency fund. You hear?

What does this have to do with becoming a millionaire? I’ll tell you.

If you have an emergency and don’t have some liquid cash saved up in a savings account like one from Capital One 360, you’re likely to either go into debt (bad idea) or borrow from family members (very bad idea).

Don’t be the guy that owes his parents.

Don’t be the couple that drowns in debt.

Think of debt as the polar opposite of investing. Instead of you investing in companies, companies are investing in you – looking to make as much profit as possible by pulling it out of your wallet. It’s bad news people.

According to many experts, you should have around three to six months of expenses in your emergency fund – in bad times, I recommend you shoot for eight months.

Final Thoughts on How to Become a Millionaire

While the status of millionaire is alluring, aim to achieve financial freedom rather than arbitrarily aiming to reach the two comma club. Financial freedom may require more or less than $1 million, depending on your unique circumstances. Use our guide to figure out how much you may need to save for retirement.

Regardless of the specific financial goals you decide on, your focus should be to save and invest early and consistently while keeping an eye on fees. If you can avoid lifestyle debt at the same time, compound returns will take care of the rest.

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