How to Become a MillionaireYou can become a millionaire by inheriting a million dollars or more- that is the easiest way! As long as you still have one million dollars after paying taxes on the inheritance, you're all set. But most people do not have wealthy relatives who will leave them enough money to become a millionaire.
You can become a millionaire by landing a high paying job such as a doctor, CEO, or professional athlete. Some highly paid individuals make more than one million dollars every year from their job. But earning such a high salary takes hard work and years of training- and not everyone has the skill and talent to earn a high salary.
What else can you do to become a millionaire? The most realistic way for most people to become a millionaire is through investment. If you invest a small amount of money slowly and steadily, you can become a millionaire. But how much do you need to invest, and how long will it take to become a millionaire?
How Long Will It Take To Become a Millionaire?You can adjust parameters in the Millionaire Calculator such as your rate of return on investment, and whether or not inflation and capital gains tax is taken into account. The long-term historical return from the stock market averages about 8% per year, so this is a reasonable figure to use for planning. The long-term inflation rate is around 3%. If you want your future investment to be worth 1 million dollars in today's dollars, you will need more than 1 million dollars. Prices tend to go up over time due to inflation. For example, a car that costs $35,000 today might cost $70,000 years in the future. You can check the "Adjust for Inflation" box on the calculator so that your investment will have 1 million dollars of value in the future when each dollar does not buy as much. As a result, you will need to get more than 1 million dollars to reach your goal.
Capital gains taxes are taxes that are collected when the value of your investment goes up. The good news is that you may be able to avoid capital gains taxes if you invest in retirement accounts such as ROTH, IRA, or 401K plans. If you just want to put money in the stock market and take it out any time without any restrictions, then you'll likely need to pay capital gains tax. You can check the "Adjust for Capital Gains Taxes" box on the calculator to see how this affects the length of time to reach 1 million dollars through investing.
Read more about how to get rich through investing.