With today’s varied and numerous investment avenues and the unlimited knowledge source that is the internet, it’s possible for practically anyone to become a millionaire in just a few years.
It’s even possible to earn your first million before reaching your 20’s, a fact that has been proven by teen millionaires like Fraser Doherty and Cameron Johnson.
But what if you’re no longer in your teens or twenties? Not to worry, as the steps that help make a millionaire are applicable for any person at any age. Being in your twenties however, does have its advantages when it comes to making that first million.
Why Your Twenties?
There are three main reasons why making your first million makes the most sense when you’re in your twenties. The first being the timeliness of this period.
It is during this time, fresh out of school that you’re still full of energy and driven to prove yourself to the world and to yourself. You’re in the perfect position to make a great start.
Another reason why your twenties is a great place to start is that your expenses and distractions are at their lowest at this time. Most people in their twenties don’t have children yet, aren’t paying mortgage or responsible for anybody else but themselves.
It is during this time that you are able to focus the most on your career and financial goals.
Lastly, when you’re just starting out as most people are in their twenties, you really have nothing to lose and everything to gain.
So instead of wasting away this time buying expensive cars and clothes and getting into debt, why not start making your first million instead?
While there are numerous ways to make a million nowadays including investing in stocks, real estate, an online business venture or good ol’ fashioned savings, it takes certain steps to really ensure success.
No matter the path you choose to take, these steps are key to making sure that you stay on track with your goal in making that first million.
So what are these steps?
- Have the Right Mindset
Before anything else, you have to have the right mindset. You have to remember that making money requires hard work, and it is only through luck and happenstance that some people achieve millions without really breaking a sweat.
In most cases, be it in employment or business, earning a million will require some hard work on your part. This means getting good grades in school as much as possible, getting additional training, studying up on your specific niche, and offering up more hours at work.
Some may argue that becoming a millionaire has nothing to do with grades or hard work, but you must remember that fortune favors those who are prepared. You can’t depend on luck at all times, most of the time you will have to make your own luck through hard work.
Aside from working hard, having the right mindset also means not making excuses for laziness or lousy financial decisions and staying focused on your goal. Speaking of goals–
- Set Your Goals
In order to achieve millionaire status in your twenties, you need to set firm goals for yourself. Otherwise, you might end up in your forties or fifties still unable to reach your first million. Make your goals specific, ambitious yet achievable.
For instance, you could aim to gain 5% to 10% of your first million within your first year and gradually increase this percentage as your assets grow.
You also need to specify the means by which you intend to achieve this goal, whether it be through investments, business, savings or a combination of resources.
- Save As Much As You Can
You may be earning more money than you ever have in your life, but it will never amount to a million if you’re always out there spending it.
So another thing you have to keep in mind at this stage is that you will have to make sacrifices in order to save as much as you can. You have to keep living below your means and save aggressively.
Try to consistently save at least 20% of your net income each year, and place it somewhere secure where it can accumulate interest over time.
- If You Must Spend, Spend Wisely
Don’t borrow money in order to spend it, save for it. Also, prioritize utility.
Eliminate what is unnecessary. By focusing on what you need instead of what you want chances are, you’ll end up spending less than what you originally planned and the extra savings can go a long way to bringing you closer to your 1 million goal.
Here’s an oldie but goodie: don’t put all your eggs in one basket. Diversify. Make calculated risks, but do the research to make sure you can afford those risks.
This applies not only in stocks but with different types of assets. Venture into real estate, start a pure income portfolio or add a little more to your retirement savings.
You could also diversify in terms of income generation: perhaps take a sideline job or establish an online business. There’s always more than one way to make money and make it grow.
- Be Persistent & Patient
Becoming a millionaire doesn’t happen overnight, at least not for the majority of us. It takes dedication and time for most, so you need to be persistent and patient at the same time.
Don’t worry if some investments fall short or businesses fail; there are always more opportunities to be had. Your experiences whether good or bad will also teach you how to do things better next time, and enable you to better achieve your goals.
Earning your first million is no walk in the park, but it is definitely possible. With the right mindset and the right steps in place, you can achieve your goal of becoming a millionaire before you reach the age of 30.