Everyone of us have questioned this to ourself once in our lifetime. Can you become a millionaire with a regular 9-5 job but answer is not as simple as the question. In a nutshell if we have to answer it, the clear answer is no you can never become a millionaire with a regular 9-5 job unless you follow certain habits along side. These habits include how well you are in making financial decisions.
From a high level view a 9-5 job with an average market salary would take you around 20-30 years to save a million dollars / 8 crore rupees, but there are certain things you can do to speed up this process.
STEPS TO FOLLOW TO BECOME A MILLIONAIRE BY YOUR 30s
- Increase your income: Your income should me minimum 80 thousand dollars / 16 lakh Indian Rs. If its not there are certain things you can do to increase it, get a skill based job and invest all your money in up-skilling your self and then find a job that pays according to the skills you have.
Once you increase your income to a certain level you can move to next step.
If you wish to have money income and really speed up this process to like 5-10 years only, you will have to create multiple income streams and go hard on side hustles. - Invest your money: Now that you have good amount of cash coming in, you have to be very wise with it. Invest all the money you could ideally 50-70% of your total income, with the ideal income levels you can easily manage to save around 50% of your salary. Read all the investment related books and stuff online. Learn how stock market works and real estate works.
Real estate we don’t recommend unless you have a very huge chunk of money to invest. You can real more about this here. (Although this is specific for real estate in a city from India but it will give you the general idea when to invest in real estate and when not to). - Understanding the power of compounding: The money you invest will keep on compounding year on year, If you keep all this up consistently for 10 years you will see a huge portfolio. Which in the coming years will follow an exponential growth and you will have a never ending source of money.
Follow these few things and road to becoming a millionaire would be so easy you would even know when you reached the destination.
POINTS TO TAKE CARE OF
- Learning liquid markets: You need to have an eye for the markets and invest very wisely in the things which can offer you safe returns for minimum 15% over a long term of 10-15 years and depending upon your age you can manage your risk. If you are on the older side try ETFs and mutual funds because they are less risky and volatile. On the other hand if you are young say 22-24 prefer stocks with a higher risk but better rewards.
At 18% of annual growth expect your money to be doubling every 4.5 years, at 13% growth every 7-8 years. - Managing risk and staying consistent: In order to minimise risk try hedging your portfolio with stable investments. Stable investments are those which are not much volatile and are safe. Some examples could be gold, bonds and FDs. Dividend paying large capital companies are also great to for a regular cash flow, read more about dividend investing here.
Staying consistent is equally important. You have to understand that timing the markets are very tough and the better solution would be to invest regularly. A good way is to save money and invest quarterly only when the markets are at last 3 month low. - Avoid life-style inflation: Don’t inflate your life-style before reaching the million dollar mark. Ideally your assets should pay for your life-style and not your income.
ConCLUSION
It is definitely possible to become a millionaire with a regular 9-5. All you have to do is follow certain things.
- Be Disciplined in investing.
- Up-skilling to keep you income levels on a higher end.
- Try to create multiple streams of income.
- Staying consistent.
Keep up the hustle and you will get there.
