I always laugh when I see delusional “how to become a millionaire” posts online. Especially since most of them focus on unbelievable ways to get rich.
Some of the wildest “make a ton of money” tips include
- Become a pro athlete. Please don’t count on this. Not only are the odds of becoming a pro-athlete incredibly small (source), but it also requires a lifetime of practice, iteration, and dedication to improvement. And who likes sports?
- Win the lottery. You already know you’ve got a better chance of being hit by a meteorite or struck by lightning than swimming in a pool of Powerball cash.
- Join a multi-level marketing (MLM) business. I hate MLMs so much. It’s an industry filled with fraud and broken promises — one in which you can reasonably expect to not only be swindled, but to then swindle others, too.
These “get rich quick” schemes are just not realistic. If it were truly that simple, everyone would be wealthy.
Having said that, there are some proven, legitimate ways to get rich — over time.
In fact, I’ll give you 3 proven steps anyone can take to become rich. They do take time. But do any one of them and you’ll set yourself up for lasting success. Do all three, and you’re almost guaranteed to be rich.
1. Become an investment wizard
Investing early and often is the single best way to get rich. And the sooner you start, the easier it is to be worth a lot of money — without working nearly as hard.
That’s not a hyped-up promise. That’s a guarantee based on 100+ years of evidence in the stock market.
But don’t just take my word for it.
Let’s walk through the numbers with a real example. Say you’re 25 years old, and you invest $500/month in a low-cost, diversified index fund. If you do that until you’re 60, how much money do you think you’d have?
That’s right. You’d be a millionaire after only investing a few thousand dollars per year. Have a look:
Note: this table assumes an 8% annualized return, the long-term average for the S&P 500.
(Quick note: If $500/month sounds like a lot of money, I recommend you try my save $1,000 in a week challenge. It’s an easy way to free up cash to put toward your investments.)
Notice I didn’t say you should buy Apple or Netflix’s stock. I said you should invest in a low-cost, diversified index fund over time.
Because the real key to getting rich with investing is consistency over long-time horizons. Not chasing hot stocks or timing the market.
Is long-term investing a little boring? Yes. But does it give you a high chance of becoming rich over 20-30 years? Also yes.
As far as setting up your investment accounts, there’s a lot to cover here. I go into more detail in Chapter 7 of my New York Times bestselling book, I Will Teach You To Be Rich.
You can get the entire chapter, free, below. In it, I cover the nitty-gritty of setting up your investment accounts, asset allocation, and rebalancing your portfolio to maximize returns.
You’ll almost never find a wealthy person who doesn’t invest their money. That’s not an accident. So get started and then tackle the next step: getting paid what you deserve.
2. Get paid what you deserve
What’s the easiest and fastest way to have more money?
Increase your salary!
In fact, a one-time salary increase of $5,000 — properly invested — adds up to over $1,300,000 by the time you retire.
1-time salary increase of $5000 invested and compounded after 40 years: 1,398,905.20!
And in many cases, getting a raise only takes a single, 15-minute conversation with your boss.
If you’re interested in learning how to boost your income for life, check out my Ultimate Guide to Salary Negotiation (it’s free). It includes HD videos, word-for-word negotiation scripts, and walks you through each step in the process of getting a raise.
My favorite part: You’re already getting paid. Why not get the most out of every paycheck?
It’s a quick win, and you should absolutely capitalize on it. But if you’re looking for something that takes a bit more time — with a lot more upside — you may consider starting a business of your own.
3. Own Your Own Business
This is my personal favorite way to get rich. With your job and investments, there’s a limit to how much you’ll make.
If you work twice as hard at your job, you obviously won’t be paid 2x as much. And if you double down on your investments, there’s no guarantee that the stock market will always go up.
On the flipside, there’s no limit to how much you can earn with a business.
The fastest way to get started is to turn the skills you already have into a steady source of side income.
If you choose this option, you can quietly earn an extra thousand dollars a month on the side, like these students did.
Or if you really want to ratchet things up, you could start an online business. With an online business, you can reach billions of people on the internet every day.
Not convinced you can make real money from an online business? Check out just a few of the different ways you could make $1,000,000 online:
- 250,000 people spending $4
- 100,000 spending $10
- 50,000 people spending $20
- 10,000 people spending $100
- 1,000 people spending $1,000
Could you find 1,000 to buy from you over the next few years? I think so.
Obviously, there’s a lot going on behind those sales numbers. There’s getting traffic, building an audience, and launching a product. But it’s completely doable in a few years’ time.
Plus, you can automate your online business so once you frontload the work, the business can keep paying you again and again, even while you sleep.
We’ve shown thousands of students how to build businesses just like that. Click here to see some examples of the businesses they’ve built.
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This is a syndicated post, which originally appeared at I Will Teach You To Be Rich.View original post.