10 Ways To Become a Millionaire

October 15, 2023 — 02:00 pm EDT

Written by Laura Beck for GOBankingRates ->

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Becoming a millionaire is a dream for many, but it is possible to achieve with focus and
determination. While a sudden windfall or lucky break can accelerate the timeline, true
millionaire status usually requires diligent effort over decades.

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The good news is anyone can implement proven money management strategies that
harness the power of time and compounding interest to build seven-figure wealth. With
discipline and commitment to learn sound financial principles, the goal of amassing $1
million or more in assets is attainable for an increasing number of people.
This article will outline realistic paths that average earners can take to become
millionaires through savvy decisions, persistence and patience. You’ll discover that
becoming a millionaire is not about luck or overnight success, but rather daily choices to
live below your means, invest early and often, take calculated risks, and continually
educate yourself on how to master your money.

Start a Successful Business

Entrepreneurship provides the most direct path to becoming a millionaire, albeit with
significant risk and effort. Building a company that scales, fills a market need and
disrupts an industry can lead to an enormous payday through an IPO or acquisition.

But most businesses require large investments of time and money before becoming
profitable. Success hinges on exceptional execution, differentiation, timing and a bit of
luck. If you have the appetite for risk and a killer business idea, entrepreneurship could
make you a millionaire.

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Invest in the Stock Market

Investing money in stocks and bonds can grow wealth through compound interest over
decades. By contributing to retirement accounts like 401(k)s and IRAs and investing in
low-cost index funds, your money goes to work in the market. The key is to continually
invest over long time horizons, through ups and downs.

With 30-40 years and consistent monthly investing, accumulating $1 million or more in
investment accounts is very possible. Time and compounding do the heavy lifting.

Invest in Real Estate

Owning real estate, particularly rental properties, can build significant wealth over years
of home value appreciation and rental income. Though capital is required upfront,
properties typically gain value and generate steady cash flow. One strategy is “house
hacking” by living in one unit of a multi-family property while renting other units. Real
estate investing requires research and maintenance but can yield millions over time if
done properly.

Develop High-Income Skills

Certain skills and careers reliably lead to a higher salary, which enables faster wealth
building. Fields like software engineering, law, medicine and finance carry six-figure
earning potential. Developing expertise in a high-income field makes it easier to save
and invest larger amounts. Additionally, continuously learning new skills, seeking
promotions and progressing your career increases salary potential over decades.

A high income allows you to accelerate your millionaire timeline.

Save and Invest Over Time

Religiously saving and investing 10%-20% of your income is a tried-and-true wealth
building strategy. By consistently putting money away each month and letting
compound interest work its magic, your invested savings grows exponentially over
years. The key is giving your money as much time in the market as possible.

Any income level can utilize this savings approach. Committing to save a portion of
every paycheck and regularly invest it provides the cornerstone to millionaire status.

Ride Economic Waves

Aligning your career and investments with fast-growing fields or technological shifts can
provide a booming tailwind on your path to millionaire status. Areas like artificial
intelligence, green energy and cryptocurrency are experiencing major growth. Educating
yourself on high-potential sectors and making strategic career or investment moves
helps multiply your money quicker by riding historical economic waves.

Timing major trends aids your ability to exponentially grow wealth — just be careful not
to put too much of your money into one risky investment.

Get Out of Debt

Debt is dangerous if you want to be a millionaire. At best, it robs you of opportunities to
save and invest. At worst, it can create financial chaos that can take years to escape.

For example, using a credit card to pay for purchases is convenient — and might even
earn you a small amount of cash back or reward points that save you money. However,
charging $5,000 at 16% APR would cost $3,140 in interest and take you 82 months — or
almost seven years — to pay off if you only pay the minimum payment due each month
of $100.
Cut Down on Expenses
Eliminating unnecessary expenses is another way to accumulate the wealth of a
millionaire.

The more money you trim from your budget, the more money you have to save and
invest. For example, instead of borrowing money to buy a car, you could save up to
purchase one with cash. Then you — and not the bank — get to use the monthly
payment to make more money.

Work With a Financial Advisor

A financial advisor may be just what you need to guide you on the path to becoming a
millionaire. These professionals can help you define your financial goals and steer you
toward the best investments to reach them.

You should interview potential financial advisors to make sure they’re a good match for
you. Choose someone who operates as a fiduciary. This means they must act in your
best interest instead of their own or their employers.

Here are a few questions to ask potential financial advisors:

 How are you compensated?

 Are you held to a fiduciary standard at all times?
 Do you provide comprehensive financial planning?

Generate Multiple Income Streams

Rich people diversify their sources of income. In addition to wages or salary earned from
their primary jobs, they also earn money from investments and profit-generating side
ventures like rental properties.

Passive income — money you earn without putting in much effort — amplifies your
wealth building. It also provides a sense of financial security if one form of income dries
up. Here are some ways to generate multiple income streams:

 Invest in securities
 Buy real estate
 Start a business
 Offer your services as a consultant
 Create a product you can sell