How to Become a Young Millionaire by 40

1. The Earning Path

This is perhaps the most obvious route to becoming a millionaire. You can expect to become rich merely by saving. You have to increase your income, and that too exponentially.

Don’t settle for the first job that comes your way, and look for opportunities that will enable you to increase your income. We get it. Earning money isn’t easy. But there are plenty of options if you know where to look.

There are some pretty high-paying jobs that you can do on the side, along with your routine profession. Learn more about passive income.

Don’t rely on only one source of income. Develop multiple streams to earn your revenue. Studies have revealed that most young millionaires had at least three income streams. Indeed, some had even five or more.

Additional income streams can be anything from real-estate rentals to stock market investments and more. The important thing is to make the most of the opportunities available. When looked at that way, becoming a millionaire doesn’t seem so hard!

Become a Young Millionaire: The Process

What are your current sources of income? Does your spouse have other income sources?

Here are our multiple streams of income: 

  1. Husband: Full-time salary + phone and car allowance + bonus
  2. Wife: Salary from my own business + quarterly owner distributions
  3. Rental income from two rental units ($2,400/month total)
  4. Investment income from stocks, retirement accounts, and education accounts
  5. Other random income, such as a maternal medical trial I’m participating in that pays me about $75/month. 

This year we’re likely to bring in close to $400,000 for the first time. That feels like an absurd amount of money to me and I’m very grateful. We’ve increased our incomes substantially in the past few years. Five years ago we were closer to $60,000 annual income. 

We have always tried to live on half of our income, and now we can very comfortably live on one-quarter of our income. So we do.

What has been the single best thing you’ve done to increase your income up until this point?

Most of our wealth has come from appreciation in real estate. We were fortunate to buy our first starter home at a steal of a deal in 2015.

Its value has increased 368% in six years. The single decision to buy that run-down home for $64,000 in 2015 has made all the difference for us. (My husband remodeled it and we put in about $30,000 in improvements the first year and made it our own.) We lived really simply for years while our peers were living in nice, big homes. 

We wanted financial freedom for our family more than a fancy house.

For example, I wanted to know how it felt to be DEBT-FREE and put as much cash as possible towards paying off our first home. We scrimped, saved, paid extra every month and tracked the amortization schedule on a spreadsheet.

We paid it off in three years, symbolically on Independence Day. What a FREE feeling that was! (And to keep it real, we had almost nothing in our bank account to pull this off.) 

Our home appreciated to $130,000 after a couple more years and we took out a home loan from it to pay the down payment for a second, larger home with a mother-in-law rental, where we live now.

We purchased our home for $465,000 in 2019, but it has appreciated to more than $700,000 just 2.5 years later. (The Salt Lake City metro market is booming!) In 2022, our starter home has appreciated to $300,000. So by leveraging a $64,000 home, we now have more than $1,000,000 in real estate assets and two rental properties within six years.

In what ways do you invest your money?

We think of our first and second homes as investments, since they both have a rental unit. We also invest in retirement accounts and stocks.

Did you receive an inheritance or windfall of some kind during your life so far?

In college, my dad surprised me once with a $2,000 check for tuition. We were also given a $10,000 check from a family member around the time we had our first baby. After she was born, we were given a vehicle from another family member who only charged us $1 for it. These all felt like huge windfalls for us and we’re grateful for the support. 

What debts do you have (if any)? If so, what are they? Which have you paid off?

We paid off our first home. In fact, we’ve paid it off TWICE now, in 2018 and 2022. We graduated debt-free and have not had to worry about student loans. After that initial gift of a vehicle, we buy our other cars with cash. (We generally sell our cars after three years and buy a newer “used” car for ourselves.) So the only debt we have now is our primary residence, about $350,000 on a 30-year mortgage. 

How do you track your net worth?

Mint. I’m a very visual person and being able to SEE our net worth has made all the difference for us. We are really diligent about keeping it updated and accurate. It’s been part of our marriage since the beginning. 

For the past twelve years, Mint has “gamified” building wealth, with the common goal of growing our net worth. On any given day for more than a decade, I’ve known our net worth because I check it frequently! What you measure, you can grow.

Do you live on a budget?

Not really. I like the idea of personal budgeting, but instead, we have designated savings accounts for long-term goals, such as vacations and outdoor gear like a boat and off-road toys.

We have a rule that we talk about any purchase over $100, except for groceries and Costco runs. We’ve built a lot of trust in each other over the years. We’re a financial team, but there have definitely been times we didn’t agree on spending. (The biggest one was when I invested $15,000 in a business coach. My husband was furious about that, as it was nearly our annual mortgage payments, but I had big business goals and felt I needed an elite coach. It’s water under the bridge now and my investment has paid for itself in business growth. But I got what I needed and don’t plan on doing that again.)

What is your favorite fintech tool that helps you grow your wealth?

Hands down, Mint!

Related Content: Mint vs. EveryDollar: Which is Better?


Teenage Millionaire Entrepreneur: Characteristics

Risk Taker

Every teenage millionaire entrepreneur had to take a risk in order to get where they are today. An entrepreneur puts themselves out there and is not afraid to fail. They can not leave the fear of the unknow or failure hold them back from taking risks.


Spotting that niche in the market takes a creative mind. If an entrepreneur is not creative than they will not create innovative ideas. When things don’t go to plan an entrepreneur must use creative problem solving skills to find a solution.


If an entrepreneur isn’t motivated they will not succeed. The teenage millionaire entrepreneurs we looked at had a passion for their business, this and hard-work were the foundations of what kept them going. Being motivated when things don’t work out as expected allows an entrepreneur to not lose faith in their business.

Adaptability & Decisiveness

Being able to adapt and be flexible in an ever-changing environment is crucial for success. Although an entrepreneur can prepare for some eventualities the cannot prepare for them all, therefore being able to make a decisions in little time is of the upmost importance.


Back yourself; that is exactly what every teenage millionaire entrepreneur did. If an entrepreneur doesn’t believe they can do it then they won’t. Setting up a business is hard-work and rejection is a common feature in getting started. Having the confidence to stand by your business and not let others opinions change you is vital.

How Much To Make To Become A Millionaire By 20

Now that we know about the various sources of income and ways to invest, all that’s left is calculating how much money a child needs to make at what age to become a millionaire by 20.

Let’s go through a couple tax-efficient ways.

Millionaire By 20 Starting From Birth

Ideally, your child should start making money and investing at age 0. This way, he or she will have 20 years of compound investment growth.

Step #1: Start a business, have a business, or be a sole proprietor. If you don’t have a business, I would start a website because it’s cheap and easy to do. Today, there are endless ways to make lots of money online.

Step #2: Put your baby to work as a model for marketing material. There are parenting websites, baby care websites, Youtube channels focused on childcare, toys, puzzles, games, family finance, and so much more. Any business that is baby-related that generates income should work. However, always double check with your CPA.

Step #3: Pay your child the maximum Roth IRA contribution limit ($6,000 in 2022). If your child is working extra hard, then pay more up to the individual standard deduction limit ($12,950 for 2022). $6,000 would go into a Roth IRA, and $6,950 would go into a custodial investment account.

Step #4: Open a custodial investment account for your hard-working child. Contribute the standard deduction limit minus the Roth IRA limit each year.

Step #5: Choose your child’s investments. Let’s assume 100% goes into an S&P 500 index that earns 8% on average for 20 years.

Step #6: Each parent contributes the maximum gift tax exclusion amount to their child’s 529 plan each year. For 2022, two parents will thereby contribute a combined $32,000.

Step #7: Choose the 529 investment plan. The most common investment type is a target date plan that goes increasingly into bonds over time. Let’s say the annual return on the target date fund is just 3% for the next 20 years.

Step #8: Calculate the returns!

  • Roth IRA Returns: $6,000 a year at 8% a year for 20 years = $296,537
  • Custodial Investment Account Return: $6,550 a year at 8% a year for 20 years = $343,489
  • 529 Plan Returns: $30,000 a year at 3% a year for 18 years followed by two years of 3% compound growth with no contributions = $818,739

Child’s net worth at age 20 = $1,458,765

Obviously, earning and investing starting at birth is the most aggressive assumption. Not all parents have a business, will start a website, or become a sole proprietor. Paying a child up to the standard deduction limit may not be feasible either.

But at least the return assumptions of 8% and 3% are reasonable. The 529 plan accounts for 56% of the total net worth at age 20. Leaving $640,026 to spend however the young adult wishes after college.

Millionaire By 20 Net Worth Composition

Making a kid a millionaire by 20 might be met with disdain. However, it may be necessary to create 529 plan millionaires simply due to the skyrocketing cost of college.

Besides, you’re never going to tell any of your parent friends that you’re secretly setting up your kids for life! Stealth wealth is more important today than ever before.

In my above examples, it is the 529 plan that makes up most of your child’s millionaire status by age 20 ($818K in example one and $534K in example two). And most, if not all of the 529 plan will be used to pay for your child’s education.

You might argue that including a 529 plan in your child’s net worth is wrong. However, I argue that getting a good education before 20 is the most important asset a child can have.

In both examples, after using up the 529 plan, the child doesn’t have a million left over to spend. But what is left ($265K – $640K) is plenty for a house, car, wedding, and more.

Of course, there’s no need to make your child a millionaire by 20. Finding a way for your kids to graduate college debt-free is a triumph in itself. Instead of having $250,000+ in a Roth IRA and/or custodial investment account by 20, having just $50,000 – $100,000 would help a lot.

To get to $50,000 – $100,000 would require your child to only earn between $3,000 to $6,000 a year for 12 years starting at age 8. This income level is certainly doable with proper parental guidance.

Athena Onassis

Athena Onassis Inherited a Substantial Fortune

Now this millionaire/billionaire is a bit different from the rest of the teen millionaires, she is no entrepreneur but she is indeed extremely rich, and that doesn’t come off as a surprise once you know that she is the only heiress to the shipping tycoon Aristotle Onassis, and also the sole heir to his daughter Christina Onassis.  The inheritance was worth 300 million dollars in cash, 350 million in company shares and 150 million worth of gold bars.

Athena’s mother died when she was only 3 years old, she was raised by her father and they moved to Switzerland after her death. When Athena turned 18 her father started getting worried about her choices regarding her boyfriend the professional show jumper Alvaro de Miranda, so he convinced Athena to put most of her assets in a trust with a total worth of a staggering 800 million dollars.

The assets were managed by the executives of major banks. The catch was that Athena wouldn’t be able to touch the money or the assets until she had turned 30, until then, she was receiving a hefty allowance between 20,000 and 30,000 dollars, and occasionally granted some funds to invest in the fields she love which was horses and stables.

Accept defeats and mistakes along the way

No matter where you are looking to go with your career, chances are you are going to face a number of defeats and setbacks. These mistakes are completely normal. What is important is how you handle them. My first millionaire student Tim Grittani actually lost a lot trading stocks for the first few months until he got the hang of it. Mistakes are normal. How you handle them is what sets you apart.

Tips to Become a Young Millionaire

So far, we have shown you some paths that can help you become a young millionaire. Of course, the journey isn’t going to be easy. But these are some tips that can make your path smoother.

When you are young, you are tempted to spend your money on luxury items as soon as you start earning well. We have seen many young people buying a luxury car or watch from their first profit. But this will seldom work out in your favor.

Don’t let your guard down until you have multiple secure streams of income. Remember, you don’t have to show off your wealth. During your initial days, you should be remembered for your work ethic and not the things you own.

A lot of people believe that becoming rich isn’t in their hands. They feel that things will fall in place if they are meant to be. That’s not always true. You have to change your mindset about making money. Remember, you can become a millionaire if you are willing to put in the work.

Don’t only invest your money in business opportunities. Set some aside to work on yourself too. For instance, most successful entrepreneurs advocate reading in their spare time. This opens your mind to new ideas. Similarly, give adequate attention to your health. Take time out to exercise.

An important part of being a millionaire is never being satisfied with what you have. Break the stereotype that you are only settled if you have a steady paycheck. There are plenty of opportunities to earn great wealth, but only if you are willing to look for them. Never settle for financial mediocrity.

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