5 Steps to Becoming a Millionaire
 by Alan L. Olsen, CPA, MBA (tax)
Managing Partner
Greenstein Rogoff Olsen & Co. LLP
In the year 2002, there were 17.1 million Millionaires in the U.S. By 2013, the
number of millionaires will triple due to inheritance. For the rest of you, becoming
a millionaire is within reach if you apply a 5 step plan involving the following
areas:
- Health
- Spending
- Savings
- Investing
- Career
Health
Take care of yourself. If your health is no good, you are not going to enjoy the
rewards of a solid financial plan. Eat right, exercise daily, and discipline yourself.
The most successful investors are those people who have the best discipline to stay
with the program.
Spending
It's true, a person will always live up to the amount of income they earn. If you
make the money, you are apt to find a place to spend it. The key to successfully
saving is to spend less than you make and to also spend more money in areas that
will actually preserve wealth.
Savings
A disciplined approach to saving reaps rewards in the future. While saving early
in your career, allocate a larger percentage of your savings to stocks. A 35 year
old with $10,000 and saving $500 a month will become a millionaire by age 56 if
the money invested returns 15% per annum. If the investment rate of return falls
to 10% per annum, the millionaire age is moved to 63 years old.
Investing
Focus on an investment portfolio that minimizes your fees and maximizes your returns.
If you are not sure about the types of investments, consider low cost index funds
such as the S&P 500 or Russell 5000.
Career
No matter how much you position yourself, your career will dictate how quickly you
reach the millionaire plateau. You have to move above and beyond your job description;
Excel in your performance; Make yourself invaluable to the organization. Align your
goals and focus on efforts that make you a valuable employee. You want those merit
raises. They will add up.
Check out the Groco Millionaire
Calculator to determine how much you need to put away to enter the millionaire
class.
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