So You Want To Become A Millionaire?
Investment for young people would be difficult to understand. At a young age I don’t expect you to trade stocks, buy mutual funds or bonds, and own rental properties.
So You Want To Become A Millionaire? It’s not a secret, and it should to be simple. Two things:
- From Benjamin Franklin, “An investment in knowledge pays the best interest.” Yes, invest in knowledge, invest in education. Not just education but quality education. Make sure the education you are taking will put in a position that will able you to stay competitive. Many people become business men/women; however, most people would choose a career. Career would require college education nowadays. College education is expensive, and before you make that college loan, make sure it’s a well thought out, and it’s something that you really want to pursue. Young people do not take this lightly because many of you who will start partying and dropping your courses, and finally shifting to another major, and eventually completing six years of college instead of four (if you are lucky)
Because many college professors also live paycheck to paycheck (I’m sorry --- no offense) they will not able to teach you how to be successful both financial and personal. You need to put time and/or money that will bring you more money in the future --- this is your investment to educate yourself!
a) Buy and STUDY books. I started with a “Complete Idiot’s Guide to Making Money on Wall Street.”, and personally I like Dave Ramsey and Suze Orman books. The Millionaire Next Door series books would give you an idea of ordinary people like Laundromat owner or plumber are doing better that those people sporting luxury vehicles. You don’t need to pay full price of books --- go to the library or the thrifty stores. In thrifty stores look for books with pen marks, highlighted, or underlined. These are books that were really studied by successful people. There is something in those underlined and pen marks that will give you much wisdom and leadership.
b) Watch/Listen to visual/audio materials about personal development, leadership, and financial freedom. You-tube has many free self help videos that you can watch. Make those new iPhone or Laptop into good use instead of wasting your time for something else. :-)
- Time is in your side. Parents give your kids a head start on financial success. Start them early with investment accounts. In the USA, parents can open a special type of account called a Uniform Transfers to Minors Act (UTMA) or Uniform Gifts to Minors Act (UGMA) account. This account is not meant for college fund. (Please consult a financial advisor before making investment decisions.) The table below was given to me by a parent whose kids has grown up and now reaping the fruits of their investments. He is a very simple man and I believe he is a millionaire next door.
I started Theresa my 10 year old as Investor D with the hopes that she can continue as Investor E. By the time she reaches 65 years old, my daughter is 4.2 million better than her peers.
I started Tim a year ago as Investor B. I wish I knew this information when he was younger. Anyway, it’s better late than never. He is now 23 years old after he graduated from college and landed a job he took over the account which is now a Roth-IRA account. If he keeps putting $166.00 per month for the next 6 years and stops, he is 930K richer than someone who did not save. You can argue that with inflation and everything else, 930K is nothing when you reach 65 years old. Well, my rebuttal is 930K is 930K (almost 1M), and it’s better than nothing.
Above table assumes 8% to 9% growth rate.
Surely there are other ways to make millions like becoming a sports or Hollywood celebrity, owning a successful business, and hitting the lottery jackpot (yeah, right); however, gradually putting money that will compound when time is in your side will allow you to live better. So, start early.
Information is power only if you do something about it. Your move!
Next Topic: Spending Money
Disclaimer: If you need detailed information about finances please seek a financial or business advisor.