You may have envied the success of self-made millionaires. Have you ever stopped to think that could be you? For some, millionaire status is more than just a dream—it’s a goal that they will achieve. It will take hard work, planning, and commitment, but with the right financial advisor and motivation, you too can become a self-made millionaire.
Ready to get started? Below are nine of our top recommendations for anyone who wants to get on the path to financial freedom.
1. Maximize employer benefit programs
If you’re an employee of a company, you could be missing out on opportunities to increase your wealth. Take the time to review your employer’s benefits and talk to the HR department to see which programs you could take part in. Common benefits include:
- Employer-matched retirement savings accounts
- Health Savings Accounts, which can help to cover expenses not covered by your medical insurance and offer a valuable tax planning opportunity
- Employee stock purchase plans, a valuable tool for accumulating investments at a discount to increase your wealth
- Group life and disability insurance plans
Not taking full advantage of every benefit offered by your employer is like not cashing a paycheck. Particularly if you’ve been with the same company for many years, find out what’s available that you may not be using and take advantage!
2. Run the marathon, not the sprint
Whether your goal is to become a millionaire or billionaire, you must keep your goals front and center. While it can be tempting to invest in the headlines or let fear take over, keep your eyes on the prize. Working with a trusted strategic advisor can help you manage your assets, especially during turbulent times. Investing should be a long-term strategy—a marathon, not a sprint. Don’t let emotion or short-term promises take over when the market experiences dramatic swings. Stick to your long-term plan and rely on your advisor.
3. Invest early and consistently
Time and consistency are two incredibly important factors to becoming a millionaire. The sooner you start investing and saving for retirement, the more time your money has to grow in the markets. Even if it’s a small percentage of your salary, starting early will mean maximum payoff down the road. Consistency is important, regardless of when you start investing.
4. Diversify investments
Don’t put all of your eggs in one basket—or in this case, don’t put all of your hard-earned money into one stock. In fact, having a diverse portfolio means more than just what’s in the market. Look outside of stocks. One thing many millionaires have in common is real-estate investments. There are many ways to use real estate to grow your wealth, including long-term rentals, Airbnb vacation rentals, remodeling, and owning for personal use. Don’t be afraid to keep it local, but expanding nationally and globally can also help to reduce risk associated with the market in one particular place and can potentially lead to bigger rewards.
5. Make a budget and stick to it
The path to financial freedom is much more than just how much money you make, rather how strategic you are. If you’re a business owner, you know the importance of a budget. Don’t forget a personal budget, which is a valuable tool for staying on track, keeping your expenses in check, and avoiding frivolous spending. There are apps that can help you to develop a budget and manage your money, or you can use a good old spreadsheet. If you’re married, communicate with your spouse to create a budget you’re both comfortable maintaining. And remember, a budget should help to keep your finances on track to reach your goals, but it shouldn’t be too constraining. If you’re restricting yourself too much, you’re less likely to stick to it.
6. Make more money
This may sound obvious, but if you truly want to become a millionaire, you need to work smart and hard. If you find that your current salary just isn’t cutting it, consider how to increase your income. This may be by boldly asking for a raise, getting a second job, starting a side-hustle, or pursuing education that will enable you to increase your lifetime earnings. Stick to your long-term plan, and your hard work will pay off.
7. Prepare for the unexpected
Aside from retirement savings and investments, don’t forget your emergency fund. You never know when an unexpected event will have a major financial impact, and you don’t want to put yourself in a position of accumulating debt to pay the bills. Aim to have about six months’ salary readily accessible.
8. Don’t give in to lifestyle debt
Temptations are all around, and too often we try to keep up with the Joneses. Some debt is unavoidable, such as a mortgage or your past college loans. That said, try to be realistic about what you actually need in terms of your lifestyle, and use your goal as a screen for making purchase decisions. The newest car model might look great, but does it help or hinder your millionaire goals? Cut unnecessary expenses that are contributing to credit card debt such as unused subscriptions, dining out, and frequent shopping. Make it a goal to keep your spending within budget to avoid having to pay any interest on your credit card bills. If you want to take it one step further, consider downsizing your home, renting out the guest house, or opting for a modest car to allow for more saving and investing opportunities.
9. Maintain a relationship with your CPA and financial advisor
The path to millionaire status will have roadblocks and hurdles, along with many opportunities. You don’t and shouldn’t have to travel it alone. Having a trusted financial advisor and/or CPA on your side can ensure you are taking the right steps to reach your goals. A CPA can assist you with your taxes, finding any tax-saving credits or deductions that fit your personal situation. The fees associated with financial services far outweigh the earnings you can capture in the long run.
Don’t fall into the trap of self-inflicted financial harm with the “I deserve this” speech. Stay consistent, know what opportunities you have, work with financial specialists, be strategic, and save, save, save. The road to becoming a millionaire isn’t for the faint of heart or easily discouraged. It will take time and dedication. Your future self and family will thank you for your hard work. If you’re ready to start your path to becoming a millionaire, send us a message. We would be honored to help you achieve your goals and build a lasting relationship.