Although we each have unique goals (both financial and otherwise) I’m frequently asked and give speeches about how to make your first million.
Whether that’s an aspirational goal or tangible, it’s a wonderful milestone to aim for.
It might seem like a pipe dream at the moment, but making a million dollars is achievable and within your grasp. To see how to make your first million, check out these tips:
Stop useless spending
It’s easy to spend your way out of a million dollars. Don’t believe me? Just look at all the athletes and lottery winners who lost their fortune as quickly as they amassed it. Fortunately, the opposite holds true as well: you can save your way into a fortune.
The average American earns well over a million dollars during their working life. Although you can’t completely eliminate spending, you can work on building a million dollars, instead of wasting it on “must-have” impulse purchases. Check out my 20-30-50 plan for starters – an “anti budget” method for tracking and saving your wealth.
The key lies in investing
Oprah Winfrey. Warren Buffett. Sara Blakely. What do they all have in common? Besides being insanely wealthy and successful, they all have investment accounts to (partially) thank for it.
Although getting a raise or a promotion is a smart goal that I wholeheartedly endorse, it’s unlikely that you’ll make a million dollars from sheer salary alone. That’s where an investment account comes in. It’s the only purchase that pays you back over the long-term and makes your money work for you.
Crafty compounding
When it comes to using investing to earn a million dollars, you might be thinking that you need to invest in the next Facebook or Snapchat to make it happen.
Although a freak concentrated win in the stock market might pay off, you’re much likely to be severely disappointed in the results. It might not sound as exiting and flashy, but plain old compounding and long-term investing will also allow you to reach your goals, with a lot less risk and market expertise needed.
Known as the “Eight Wonder of The World,” compounding essentially allows your wealth to snowball by building interest on interest. Although a million dollars might seem unreachable, it is possible with time and patience, largely thanks to this tool.
Want to learn more about how to make your first million?
