Becoming a millionaire is a goal that most of us have and it is a noteworthy goal. Having financial success shouldn’t just be a goal, it should be an obligation. It is a necessity. Our family, community, society need us to have financial success. With adequate financial means, we are more able to solve our problems and the problems of our loved ones and our community. Following the seven steps below can help move the goal of becoming a millionaire from a wish to reality.
7 steps to becoming a millionaire.
1. Figure out your current net worth: If you don’t know where you are, then you cannot know where you are going. The first step in doing anything is to first know where you are. Taking stock of your current net worth is important in your path to becoming a millionaire. There are several apps and tools that can help you achieve this including apps such as mint, personal capital and our all-faithful Microsoft excel.
2. Create a budget and cut all unnecessary expense: The next step after figuring out where you are with your net worth is to reduce your expenses. Just like figuring out your current net worth, creating a budget will let you know where you stand with your current expenses. Cutting out all unnecessary expenses is critical to your path to becoming a millionaire.
3. Stay away from all consumer debt: Consumer debt robs us of our ability to build wealth. Buying what we can’t afford in order to impress people is a sure way not to achieve your millionaire goal. Debt from clothes, student loans, cars, etc. (depreciating items) hinders us from building wealth. Going into some debts is unavoidable for most of us, however, making a commitment to pay them off quickly and staying out of debt will enable us to build wealth rapidly.
4. Save and Invest aggressively: There is no secret to building wealth, you have to save and invest. Making a commitment to saving and investing at least 30 percent of your income is crucial to building wealth. Even though attaining a savings rate of 30% is difficult for some of us, we have to strive to get to this number or higher. As we invest, it is important to make sure we are not speculating but investing in tangible investments such as Real Estate, index funds and cash flowing businesses.
5. Educate Yourself: Investment in yourself pays the best dividend. As you get on your investment journey, invest in your education. Learn the habits of millionaires. Reading and committing to continuous learning is important to your millionaire journey.
6. Increase your income: There are several ways to increasing your income and, in your journey, to becoming a millionaire, you will need to keep increasing your income. Getting a job with significant upside in your income such as a commission-based job, a job that can lead you to the C-suite or starting a side hustle will be imperative in your journey to becoming a millionaire.
7. Re-invest your cashflow: As you make progress on your path to becoming a millionaire and you follow the six steps above; you will start to generate significant amount of cashflow. Re-investing the cashflow will lead you to accelerate your millionaire journey. Becoming a millionaire in 35 years is laudable, however, becoming a millionaire in 10 years is more impressive and attainable.
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