In today’s world regardless of your day job, profession, race, nationality you can become a millionaire. To start off with, if you already think you can never be, then you lost half the battle already and highly likely you will be ever either. First, let’s look at what is the definition I am using the term ‘Millionaire’ – I am using your total asset value, not your yearly income. Earning Million dollar a year is still hard but having a total asset (your property, cash in the bank, investment etc.) accumulated to million dollar over time is not impossible perhaps not even that hard as you think. Another argument if being a millionaire is any good in today or enough at all – but I will leave that for a later article.
Have a goal in mind & a plan to support that
If you think you will win a lotto, or just come up with a unicorn business idea and sell it for multi-million dollar, or over the time your income will grow so much that you will save million in 1-2 year you are a dreamer and it will never happen – I guarantee you that. As I said earlier if you can plan for it properly your day job, monthly income, profession, race, nationality all that doesn’t matter but what matter is how long it will take i.e. the “time”. It goes by a simple equation: your total income minus total expenses = your saving/investment worthy fund. Higher it is quicker you get there, lower it is more time it will take, but you will get there someday. Idea is to plan for it and work harder towards making is a bit faster. Let’s looks at some number (I pre-calculated this and you can check – it works), here are some of the options, and when you break it down they all look lot achievable isn’t it:
- If you invest $10/day and earn 10% profit on that in 33 years you will be millionaire
- If you invest $10/day and earn 15% profit on that in 25 years you will be millionaire
- If you invest $20/day and earn 15% profit on that in 20 years you will be millionaire
- If you invest $100/day and earn 15% profit on that in 10 years you are millionaire
- At 15% average return per year, it only takes 30 years to turn $15,000 to $1 million
That was from the saving/investment side, now let’s looks at the other side i.e. earning 1 million dollars and break that down (numbers are rounded):
- Selling 100k Products for $9.90 gives you a 1 million dollar
- Selling 50k Products for $19.90 gives you a 1 million dollar
- Selling 20k Products for $49 gives you a 1 million dollar
- Selling 10k Products for $99 gives you a 1 million dollar
- You need to sell 1700 subscription for $9.90/Month to get 1 million dollars in 5 year
- You need to sell 850 subscriptions for $19.90/Month to get 1 million dollars in 5 year
- You need to sell 350 subscriptions for $49.90/Month to get 1 million dollars in 5 year
Now look at some other numbers to support it’s not impossible:
- Product sales: There are 7+ Billion people population in worlds you can sell to via the internet (let’s assume 50% doesn’t have the internet, still then its 3.5+ Billion)
- Property investment: Sydney property price growth was 70.3% (Australia 41.4%) in last 5 years, that’s 14%+ per year and all you need is 10%++
- Manage funds: Average managed investment funds make around 10%++ conservative (if you pick the right fund).
- Stock market: Historical stock price growth in the 1990s was 18.17%; 2000s was 1.07% & 2010-2013 was 16.74%. All you need is around 15% growth.
It’s totally achievable one way or the other. You need to have a plan which one suits you and your time and expertise. You need to have a plan how long you think you will take and what seems more achievable to you. Most critical thing is to believe you can, have a plan and stick to the plan.
Get multi-stream of income
Now that we know for sure you will be a millionaire, now let’s look at how quickly we can get there. Most of us would have a day job but that’s only for 40 hours a week (50 is you got a demanding job). Where does the all other 128 hour each week goes of 168 hours in a week? I have a full article on some of the side income generating idea’s but here is couple of simplest things that will give you 1-2 thousand dollars a month with 10-15 hours of work:
- Drive Uber car, drive a Taxi
- Sell something at eBay, Facebook, Gumtree, Amazon (there are no shortage of product & people in the world – that’s for sure)
- Good at crafts? Make it and sell it online
- You have a specific expertise that people willing to pay for the knowledge? For example, health industry, tech industry (website, server etc.), food industry – you can sell freelance consultancy time on pretty much anything nowadays.
These are just a few – there is no shortage of work and stream you can make money from. The idea is even if you make like $500 each month – that’s $6000 a year extra. Putting $6000 extra in your savings will cut down your goal being millionaire by years! Idea is to have multiple of those streams. What you need to attain for is over the time your involvement/effort reduces and it generates some income for you i.e. passive income. More of the passive income stream you can generate quicker you will become a millionaire. But know that there is no shortcut of hard work – no matter what it is you will need to work hard, you will need to give time.
Don’t get too harsh on your expenses & budget
I personally do not believe in the saying “Penny saved, penny earned”! You never going to be a millionaire by savings pennies. For example, you just start savings – you cut all your expenses to save more. The things are path to million is a lengthy process, it takes years five, ten, twenty years. How long you can live with that level stressed budget? six months or a max couple of years? then what? Don’t plan to fail, plan that is reasonable, fit within your lifestyle, fit your income level. On the other hand – what is the point of being a millionaire if you never spend and enjoy your life & you made your life so miserable in the process that you do not have friend or family left with you. Money is worthless by itself – it’s fun when you have people to share it with.
“Do not put all your eggs in one basket” – timeless saying, even true today. Basically, this is the risk mitigation strategy if you have your investment spread across multiple streams, your return may be a bit low but if one thing fails you still covered with others. Invest in a diversified portfolio i.e. some in business, some in property, and some in saving/cash. Also spread across high-risk and low-risk profiles, higher risk always profile gives you more return but more risk to lose it all so you need to balance. Most importantly “if it is too good to be true – then it’s not true”. There is no shortage of scam around, especially with the investment. If someone promises you 20%+ return no ways it is true.
Constantly review & update
You need to monitor how you processing towards your goal, to start off with it will give you the confidence and motivation to stick to your plan but more importantly once you see something is not working you can change it, modify it, fine-tune it to make it work for you. Also once you know how much you worth today and how close you are to become ‘a millionaire’ hard work become more fun.
About the author: My name is Shahnewaz Khan (firstname.lastname@example.org) I am a Project manager on my day-job and have done fair bit study from post-grad Business school. I find there are a lot of principles from my day jobs and the things I learned at B-School can be applied to our daily life. In my blog I write about those – please subscribe if you like for regular updates.