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How to Become A Millionaire

By Patrick on Jul 17, 2008 in Personal Finance

My wife reads my site and often sends me links to stories and other ideas. The other day she sent me a link to a recent MSN story, 8 Ways to Make a Million bucks. The article chronicles 8 different millionaires and shares a brief story about how each of them reached millionaire status.

As you would expect, the stories are as diverse as the people they highlight. Several people started their own business, one man made his millions in real estate, a firefighter cashed in his pension, and another made his millions working an $11 an hour job (and making wise money decisions along the way).

I sent my wife a quick e-mail thanking her for the link and when I closed the e-mail, I wrote, “I wonder what our millionaire story is going to be?”

Her response: “You think we will have one?”

Me: “Of course, it’s only a matter of time.”

And I believe that. I don’t know what it will be, and it may not be glamorous, but we will be millionaires. It’s only a matter of time… and a few other factors.

How to become a millionaire:

Becoming a millionaire is not extremely difficult. It takes money, time, discipline, and a little luck. All you need to do is follow these 5 steps:

Earn Money.

Unless you are born into riches, inherit wealth from someone or strike it rich in the lottery, you need income. And as this 78 year old man proves, you don’t need to earn a lot of money to become wealthy. It’s what you do with that money that matters.

My wife and I earn a decent living, but if and when we have children, we will move down to a one income household. We have been preparing for that day, so we should be able to handle it financially. Even so, I am trying to earn more money through this website and other online ventures which should increase our income and soften the blow that comes from moving from two incomes to one.

Spend Less Than You Earn.

My wife and I have done fairly well with our finances. One reason for this is that we spend less than we earn. Another, and perhaps better, way to look at this is to earn more than you spend. Don’t get me wrong, I think spending money is good. But living within your means is the key to financial success. If you can combine both of these principles, earn more and spend less, you will be ahead of 95% of the world.

Save and Invest.

Money saved is worth more than money earned, and you should take advantage of that principle. Once you have a surplus of money, you need to do something constructive with it. Saving and investing is the best way to do that. Compound interest has been called the strongest force in the universe, and you want that force working for you. There are many ways to invest, and as long as you make wise investment decisions and let time and compound interest work for you, you will be successful. Start by paying yourself first.

Repeat.

Earn money, spend less than you earn, save and invest, repeat. After that it’s just a matter of time. Even if it takes years or decades, the process really is that simple.

Is it really that easy? Yes. It may not seem as easy as I laid it out here, but it really is. Remember, this is not an overnight get rich quick scheme. It takes time, planning, and a little luck along the way.

Get started. If you want to become a millionaire, you need to decide to do it and get started. If you are not be able to save money right now because of debt or other financial obligations, you should work on those issues first. A good place to start is with Dave Ramsey’s Baby Steps. This is a tried and true method for setting up an emergency fund, paying down debt, and beginning your investments. Once you have that started, you can begin your million dollar journey.

Read more about becoming a millionaire:

What will your millionaire story be?

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Tags: Dave Ramsey, how to become a millionaire, Investing, saving

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9 Comment(s)
By Eric on Jul 17, 2008 | Reply

I am hoping my success story involves a combination of the blog and consulting. I’ve been really struggling with the consulting lately in an attempt at networking and obtaining more clients. Between the two blogs, keeping up with industry, and maintaining an amicable family relationship I find I am short on time. My wife has not worked for over 2 years so we are on a single income. We do have a child who takes a lot of time and money.

It is a lot harder when you only have one person working. Yet she has been looking at jobs lately and the pay is sub par. In fact one job was offered to her where if you do the calculations. Including gas, day care, and lunch she earned roughly 5 dollars a day. At that point it isn’t worth her working.

Anyway, I’m hoping some day sooner than later I will reach that millionaire status. Takes a lot of work, and a lot of patience
By Ron@TheWisdomJournal on Jul 17, 2008 | Reply

Everything is only as hard as we believe it to be. When people can start with nothing, and I mean dirt poor nuthin’ and wind up filthy rich, no one with a properly functioning mind has an excuse.

The difficulties lie only in the mind.
By Jarhead on Jul 17, 2008 | Reply

One day man one day. I have finally gotten my finances to a point where I can see how this will be possible just have to get it done now.
By Benjamin on Jul 18, 2008 | Reply

I’m exactly sure how our millionaire story is going to pan out either, but I am quite confident that it will happen (someday).

I think the trick is staying focused but not become overly obssesed with the idea.

Finding a steady financial plan that you can stick with is key. It also doesn’t hurt to pursue a job that you love.

I can rest assured that my Blog will not be an intergral part of my attainment of “millionaire” status, but at least it can be used as a medium to track my progress along the way!!
By Patrick on Jul 18, 2008 | Reply

Benjamin, I plan on using my blog to help keep me on track as well. In fact, I wanted to name my site “Million Dollar Journey,” but that domain was purchased a few months before I started blogging. I’m happy that Frugal Trader ended up with it though, because he has a great site!
By Kristen on Jul 18, 2008 | Reply

I read that article, too. As much as I like to be an optimist, I must admit that I don’t think I’ll ever be a millionaire. I think I can do better with my finances and build a more secure future. But, I don’t think I’ll have a million or more unless I get really lucky and hit the lotter!
By fathersez on Jul 21, 2008 | Reply

The process does seem easy, if we manage to master the all mighty earn more than we spend. Still how we handle the bumps along the way will make a big difference.

I have no doubt that you and family will end up millionaires. And you can tell your wife I said that.

Best regards
By Island Spice on Aug 1, 2008 | Reply

This is how I live already, I’m not a millionaire YET, but I am comfortable and satisified and in the end thats what really counts.
By Mr.Vue on Aug 5, 2008 | Reply

Don’t let people put you down. You can become rich as long as you know your path were your going and know what your doing. Anyone can become rich, here’s some idea of becoming rich, catering to the rich people, selling private jet planes to people. Make your own websites and when it has a value sell it off, but to whome? see the problem here is that you got to know the right people, and talking about makeing websites believe me, you can sell your websites for 10million and or less it really depends on the value and effort of time that you put in it.Ex,Look at tom a Young adult who is the maker of myspace. everyone thought that myspace probably something thats going to be laim but Tom waited and as time goes by the whole world know’s about myspace now. And lets see he sold his website to some rich company for 2million and he’s living off from the money. and talking about lottery believe me there is only a 00.001/2 chance of winning only don’t dream about it.

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