Loading...

How to Become a Millionaire

Descriptive
How to Become a Millionaire

Show of hands if you want to be a millionaire…

Who doesn’t?!

Attaining millionaire status may seem out of reach for many – unless you inherit a piece of that family fortune, the thinking often goes. Or strike a jackpot. Probably win big in Vegas. But if there is anything a careful analysis of the world’s millionaires does yield, it is that with the right mindset, habits and smart investment choices, this can become a surprisingly achievable goal. You can also throw graft in there too.

Just because you have an average income at present doesn’t automatically rule you out of the list of future millionaires. Nor does a fat paycheck automatically guarantee you a high net worth status in future. If the question of how to become a millionaire has crossed your mind at some point, here is a common theme we established among most self-made millionaires that will boost your chances of walking down the well-heeled path.

Develop a Millionaire Mindset

First things first, unless you are a lucky heir to some rich fortune, millions don’t just drop on top of your lap. It all starts with a mental shift and the belief that there are so many opportunities waiting to be exploited. So, at least, there is a 50% chance you stand to make money. Chances are you have heard the phrase that to become a millionaire, you have to start thinking like one.

girl sitting by pool

Whether you call this positive thinking, the Law of Attraction or a mindset of abundance, bottomline is that the right mindset is very much part of the equation.

Save your Income

There really is no escaping this one. To become a millionaire, you need to get into the habit of saving money. Yes, there are those two conflicting schools of thought whereby one preaches that in order to be rich, you need to be frugal. The other thinking encourages you to spend it like you got it with the aim of shedding that frugality mindset and fear of losing money which only holds you captive.

cash money piggy bank

Regardless of whichever doctrine you may feel inclined to subscribe to, the truth is that you cannot get to the promised land without making substantial savings along the way. This doesn’t mean to be a penny pincher. Point is, you need to make savings – save your income in earnest, have an emergency fund for when unexpected expenses strike, have retirement in mind, and so on.

Diversify your Income

If you look at the world’s wealthiest and most successful people, you will find two things they have in common. Either they are entrepreneurs, or they have multiple income streams. And that’s the thing. Even if you are bringing in $50,000 a year and you only get to save 5-10% of that, it will be pretty hard to save and invest enough to retire in the next 30 years.

cash money bills

However, by diversifying your avenues to bring in more revenue, the more money you are able to save, as obvious as that may sound. These revenue streams could be anything really: putting a skill you have to good use – coding, playing the guitar, photography; working another job – walking dogs in your neighborhood, playing nanny; investing – either in rental property or the stock market, and so on.

Avoid Falling Victim to Lifestyle Inflation

Majority of people fall into the pitfall of hiking their spending habits to match the money coming in. And this is what we mean.

For instance, when you are making $30,000 a year, your total expense averages, say, $25,000. You work two jobs or get an extra source of income, and manage to bring in $50,000 in total, an increase of about 67% to what you were getting. Now that the money is happy, your spending correspondingly goes up, and instead of the $25,000 a year expenditure, it shoots to $40,000 to match the money coming in, an increase of $15,000.

ocean beach side luxury

It’s a common booby-trap, this.

And if you can be able to rein it in, the more funds you can save. As the saying often goes, it’s not your salary that makes you rich. Rather it’s your spending habits. While we don’t claim this to be a magic formula, putting these ideas into practice will dramatically increase your chances of becoming a millionaire.

Related articles