How to become a millionaire with a 9-to-5 job (SIMPLEST WAY!) - YouTube

Hi, it's Mia. Did you know that there are over  20 million millionaires in the U.S.? That means  

1 in 13 American adults is a millionaire,  so the chances of you knowing someone who  

is a millionaire is actually becoming a lot more  common. In this video, I’m going to share with  

you how you can become a millionaire with just a  9-to-5 job. This is not a get rich quick scheme.  

It's a tried-and-true model that has been  successfully replicated by many people.  

So if you want to learn how you can join  the ranks, watch this video until the end  

and subscribe for more videos like this. - There  are many ways to become a millionaire. Some  

examples include starting a successful business,  winning the lottery, inheriting the money,  

or just from saving and investing. Starting  a successful business can take a lot of time  

and hustling to build it up into a profitable  business that will make you a million dollars.  

The lottery involves pure luck. You can't  choose to be born into a wealthy family.  

In fact, only 20% of millionaires inherited  their wealth. The other 80% were self-made.  

Out of the many avenues to get to a million,  the one that is the simplest--and which can  

be replicated by almost anyone in my opinion--is  long-term investment in the stock market. As I've  

mentioned previously, this is not a get rich quick  scheme, but it's a get rich slowly-but-surely one.  

Investing is a long-term game. It’s going to be  slow and it’s going to be boring. The reality is,  

you're not going to get rich overnight. Even  the stories covered by the media of people who  

have become millionaires from cryptocurrency  or meme stocks, seemingly overnight, don't  

cover the other 99% of the people who have lost  money from it. If you want excitement, take $500  

and go to Vegas. But if you want steady and  consistent growth, then you need to invest. - When  

you're investing in stocks, you're owning a  piece of a business and you share in its profits.  

Think of the many multi-million dollar companies  out there that are offering products and services  

that people use and need on a daily basis.  Every day, the employees of these companies  

are hard at work trying to make the company  profitable. With the invention of the internet,  

purchasing stock in these  companies has never been easier.  

So let's dive into the 5 things that  you need to do to become a millionaire:  

Number one: You need to start early. How much you  have to save to become a millionaire depends A LOT  

on what age you get started. The reason why  starting early is so important is because of  

compound interest. Albert Einstein called compound  interest the “8th wonder of the world." Basically,  

it's money growing on top of money. And for money  to do that, you need time. If we look at data  

from the S&P 500, we can see that $100 invested  in the S&P 500 in 1957, which is when the S&P  

500 started being tracked, is worth over $57,000  today. This growth is due to compound interest.  

If the stock market returned 10% one year,  that means $100 invested is worth $110. If it  

produces another 10% the following year, that  $110 becomes $121 and so on and so forth. The  

earlier you start, the more likely you will become  a millionaire. So let's see how we can apply this  

concept in real life, but we'll be a little more  conservative and assume an 8% annual return that  

is compounded annually. Here's how much you would  need to save to become a millionaire by age 65.  

If you got a job right out of college (at 22)  and invested just $117 every two weeks or $253  

every month in a globally diversified mix of index  funds with low management fees, you will become a  

millionaire by 65. That’s it. That’s the secret to  becoming a millionaire. You don't actually have to  

squirrel away $1 million dollars because compound  interest does the heavy lifting for you. A lot of  

people doubt the ability of compound interest to  grow that much but let's look at it in reverse--if  

you were in debt, which unfortunately, more  people are familiar with--compound interest  

will grow that debt into an unmanageable amount  because the debt is being compounded every month.  

So trust that the opposite is true, that you  can grow small amounts from your paycheck into  

a million dollars. The problem is that most  people don’t start thinking about investing  

until they are in their 30s or later. If you don’t  start investing until you’re 30, you’ll have to  

save twice as much per biweekly paycheck to end up  with a million dollars by 65. The longer you wait,  

the steeper the climb. And the amount that you  need to save doesn’t just increase slightly,  

it increases exponentially. At 50, you’d need  to save $3,079 a month to become a millionaire.  

That’s tough if you also have kids entering  college. Additionally, compared to someone who  

started earlier, you would also have to contribute  more over your lifetime to reach one million.  

And if you’re an overachiever and want to become a  millionaire way before the age of 65, like for the  

people following the FIRE movement, which stands  for financially independent and retire early, then  

you will need to crank up your monthly savings.  For example, instead of saving $253 a month,  

you can save and invest about $2,000 a month. This  breaks down to basically maxing out your 401(k)  

and your Roth IRA every year. For 2021, you’re  allowed to contribute up to $19,500 a year towards  

your 401(k) and $6,000 dollars a year towards your  Roth IRA. That's $25,500 a year or $2,125 a month.  

This will drastically cut down on the time that  it will take you to reach your first million.  

A question I get asked a lot is, is it too late?  It’s never too late to get started. The best  

time to plant a tree was yesterday and the second  best time is today. If you're in your early 30s,  

you still have more than 40 years for that money  to grow. It's not too late to plant that tree.  

The important thing is that you start today.  It can have a powerful effect on your future.  

Number 2: You need to diversify your investments.  Numerous studies have shown that investing in a  

broadly diversified, index fund or mutual  fund will outperform an actively managed  

fund, i.e., one that is managed  by a professional fund manager,  

the majority of the time. Over a 15 fifteen year  period, only 18% of fund managers actually beat  

their benchmark. So if these professionals can't  even beat the market, it's very hard for amateur  

investors to beat it. So instead of trying to pick  individual stocks that you think will be winners,  

buying a low-expense index fund or ETF that  tracks an index like the Russell 3000 (which  

includes nearly the entire total stock market) or  the S&P 500, which tracks the five hundred largest  

publicly traded U.S. companies) will give you  instant diversification, lower your risk, and  

give you the best return for your money. You'll  be automatically invested in five hundred to  

three thousand U.S. companies. Some examples of  funds that I encourage you to research further  

to see if it’s right for you and your  investment goals are VTSAX and VTI,  

which are the Vanguard Total Stock Market funds.  These are funds that I personally invest in.  

Number 3: You need income. You don't need to  have a high paying job to build a million dollar  

portfolio, but you need a decent income which  will allow you to build a savings. The reality is,  

if you're making barely enough income to  support yourself and for some people, a family,  

you won't have any room to save. For people in  this situation, saving is nearly impossible until  

their financial situation improves. When you  have a decent income, you'll have room to save,  

then you'll use the savings from that job to  invest and grow your money. - When you have  

a W-2 job, you are trading your time for money.  If you were paid twenty dollars an hour, you are  

trading one hour of your time for that twenty  dollars. You're also taxed on that amount, and  

the tax on earned income is actually higher than  the tax on capital gains from your investments.  

Your goal should be to try to convert those earned  dollars into invested dollars as soon as possible.  

When you are investing, imagine that each  of those dollars are your employees and they  

are being deployed to work for you so you  are no longer trading your time for money.  

Instead, that money is out there making money for  you, even without you being physically present.  

This is essentially what you are doing  when you invest and earn passive income.  

Take Mr. Ronald Read for example. Mr. Read was a  one-time janitor and gas station attendant who,  

unbeknownst to those around him, amassed an $8  million fortune by investing in the stock market  

When he died at ninety-two, he owned stocks  from at least ninety-five different companies,  

mostly blue chip companies. He left $6  million to his local library and hospital.  

You don’t need to learn to pick stocks like Mr.  Read. All you have to do is buy index funds with  

low management fees. Tip number 4. To become a  millionaire, you need to avoid consumer debt.  

This includes credit card debt, auto  loans, and other high interest debt.  

If you have debt, especially high-interest  debt that is more than seven percent,  

you need to work on paying it off quickly. The  interest rates on those loans will compound  

quickly and tie you down and eat away at any  potential money you will make from investing,  

so get rid of consumer debt as fast as you can.  Number 5. You need to understand your net worth.  

Net worth is your assets, or the total value  of everything you own, minus your liabilities  

(that is, your debt or everything that you owe).  For example, if you own a house worth $500,000,  

have $20,000 in a 401k, $5,000 in a Roth IRA,  and own a car worth $15,000, your total assets  

are $540,000. If you have $10,000 in credit  card debt, $100,000 in student loans, ten  

thousand dollars ($10,000) in an auto loan, and  the remaining mortgage on your house is $400,000,  

your total debt is $520,000. When you subtract  $520,000 from $540,000, you get a net worth of  

$20,000. To become a millionaire, your net worth  needs to grow to one million dollars or more.  

That means learning to live below your  means and avoiding lifestyle inflation.  

Lifestyle inflation happens when your  spending goes up as your earnings increase.  

It’s how some of the highest  income earners, like doctors,  

Hollywood stars, and professional  athletes, end up with very little savings.  

These people are known as HENRYs--High Earner, Not  Rich Yet. If you get a raise, put that extra money  

into your investments so that it can grow faster.  The reality is that everyday millionaires are  

nothing like the millionaires portrayed on TV or  in Hollywood. They don't live in lavish mansions,  

own yachts, or drive flashy cars. Often times,  these flashy people are living paycheck to  

paycheck--even if those paychecks are hundreds  of thousands of dollars or millions of dollars.  

According to the New York Times  bestseller, The Millionaire Next Door,  

a typical millionaire is more likely to drive  a Ford and they don’t have a lot of wealth tied  

up in their home. So keep that in mind the  next time you see someone drive a flashy car  

or upgrade their home to a McMansion. #6 This next tip is a bonus tip, but in my  

opinion, it's one of the most important ones that  I want you to always keep at the back of your mind  

because it will determine whether or not  you will actually become a millionaire,  

it's this--you need to change your mindset. A  survey of more than ten thousand millionaires  

found that 97% of millionaires had one mindset in  common--and it was that they believed they were in  

control of their own destiny. If you compare that  to the general population, only 55% held the same  

opinion. It makes sense, right? If you believe  that you can become a millionaire, you will make  

the necessary changes in your lifestyle to get  there. If you believe that it is something that  

is beyond your control, you are less likely to  make any changes in your life to reach that goal.  

If you’re someone who is currently not earning  enough to be able to save, work on developing  

skills that would make you more marketable.  Learn to negotiate your salary for higher pay.  

Ask yourself how you can get to where you want  instead of just accepting the status quo. -  

If you enjoyed this video, be sure to subscribe  to this channel to be notified when I upload  

my next video and click on the "Thumbs Up"  button below. It will motivate me to create  

more videos like this and help this video reach  more people. Let me know in the comments below  

if you're shooting to become a millionaire.  Let's all help each other get there!