5 easy steps to
become a millionaire
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Heroes & Incredible peoples
www.Investopedia.com :Who wouldn't want to be worth a million
dollars? Many of us dream of achieving this goal, more often than not for the
sake of the freedom financial stability would bring. So how can we get there?
The answers are actually much easier than you might expect. Here are several
easy steps to get you into the millionaires' club. (With a little discipline and
the help of some powerful savings vehicles, anyone can hit this mark.)
1. Only Marry Once
According to "The Millionaire Next Door" by Thomas J. Stanley, Ph.D and William
D. Danko, Ph.D, the average millionaire is married with three children. The
wives of these millionaires are good budgeters and most often described as even
more frugal than their husbands. Interestingly, according to Stanley and Danko's
survey, half of these wives do no work outside the home and of those who do,
they are most likely teachers.
One upside of only marrying once is avoiding the costs of divorce and of
subsequent weddings. The cost of a divorce depends on many factors including
income, attorney fees, court fees, and the assets a couple has and how they are
divided. The average wedding cost in the United States in 2010, according to The
Wedding Report.com, was $24,070.
2. Live Off One Income
One of the advantages of having a life partner is the potential to pull in two
incomes. If you are able, consider structuring your set expenses based on only
one income, and save what comes in from the other income. Doing so strengthens
your financial position in two ways: In case of an emergency or if one partner
loses their job, you will not only have less set expenses to cover, but you will
also have built up your net worth as a safety measure.
3. Choose the Right Career
According to The Millionaire Next Door, "self-employed people make up less than
20% of the workers in America but account for two-thirds of the millionaires."
The book goes on to list an average of 45 to 55 hours spent working per week, so
by no means is this the self-employed fantasy of playing golf while your
The idea of the "right" career can encompass a myriad of factors. Ideally, this
would be a career you enjoy, otherwise you likely won't be putting in the
dedication required to be successful. The right career would also coincide with
overall working trends, or at least not work directly against them. For example,
starting a career in typewriter manufacturing may be something you are
passionate about, but it would likely suffer due to the current technological
4. Put Your Money in Appreciating Assets
According to Stanley and Danko, the millionaires in their survey invested nearly
20% of their realized household income each year. Nearly 20% of the household's
wealth is held in "transaction securities such as publicly traded stocks and
mutual funds" and the millionaires tended to rarely sell their equities. Only a
very small number of the millionaires surveyed had ever leased a car; few even
drove the current year model. Half of those surveyed had lived in their homes
for more than 20 years, which, as the authors point out, means they have likely
enjoyed "significant increases in the value of their homes."
The end result? These people put a financial priority on assets that will make
them money, from their homes to their businesses.
5. Don't Live the Millionaire Lifestyle
Warren Buffett's frugal lifestyle (especially relative to his net worth) is the
go-to example for this point. The average value of the surveyed millionaires'
homes was $320,000. The bottom line is, those who spend their money on
non-appreciating assets cannot put that same money in an asset that will net
them a return and increase their wealth. If it is important to you to build your
financial worth, stop spending it on new cars, toys and clothes. (The Oracle of
Omaha has a net worth in the billions, but his lifestyle is not as rich as you
The Bottom Line
Becoming a millionaire is easier than ever. While this is a dream that will take
work and discipline to achieve, it isn't as far out of reach as you might think.
Be smart with your money and before you know it, you'll be able to count
yourself among the world's wealthier citizens.