Have you ever thought about becoming a millionaire by 30?
I recently wrote a post about a MarketWatch tweet which stated you should have twice your income saved up by age 35. MarketWatch was met with wide backlash and controversy over their opinion. My post went through some basic math which actually shows how simple achieving 2x income can be with wise saving and money management. In this article, I’d like to expand on that further.
When it comes to finances in your 20’s, why aim for anywhere besides the moon? If there is ever a time for calculated risk-taking with money, it’s between the ages of 18-30. Find the right balance between traditional investing advice and an appetite for risk at a young age. I’d like to cover a few tips and tricks from around the web from 30-year-old millionaires.
Tips To Become a Millionaire By 30
Incorporate the following five tips into your day-to-day thinking to become a millionaire by 30. Even if you don’t hit the million dollar mark, having the mindset puts you in a better spot to get ahead of the game.
1) Diversify Between Conservative and Aggressive Investment Strategies
First and foremost, you’ll need to take risks to rise above the million-dollar mark by 30. Unless you come from a wealthy family with parents who throw money around, your early 20’s will be a time of tight purse strings and frugal spending. Rather than waste the bulk of your early days consuming, it’s wise to take some calculated risks in the hope of a massive possible reward.
Find the appropriate mix between spending money, low-risk investments like a 401k or a CD, and high-risk investments. An example of a higher-risk play might be a stock with a low price and massive upside. Do your research and invest only what you’d be ok with losing. A combination of luck and a keen eye can turn this side money into a larger nest egg.
Not sure where to get started with investing? Check out our guide for beginners here.
2) Live Below Your Means
As the well-known real-estate guru Grant Cardone says – “Don’t show off, show up”. Take it from someone who has been there – once money starts flowing in from your first real job, this tip can be tough to impossible to accomplish.
Nothing will slow you down on the path to massive wealth at an early age faster than gaudy, unnecessary spending habits. Reel it in with the fancy clothing, cars, and homes. So many of the flashy lifestyles we see on Instagram these days are actually a product of a paycheck-to-paycheck, debt-filled life. Living like a pauper allows you to build wealth like a king.
If you’re ready to start your first budget, you should definitely check out our Budgeting for Beginners Tool.
3) Understand Luck, Preparation and the Difference Between Them
The research behind this post involved reading many stories of young millionaires. I’d be lying to you if I said EVERY SINGLE ONE didn’t get lucky in some way to end up where they did. While luck can be completely blind, it is the intersection of luck with flawless preparation that made these folks their million.
Tip one involves taking calculated risks to build a large nest egg at a young age. The keyword here is calculated. We aren’t putting our net worth down on black and rolling the dice here. Go into any investment or wealth building activity with a plan in place and advice from the experts. Doing your homework helps you create as much of your own luck as you can.
Putting too much faith in luck can make a person broke just as easily as it came make them a millionaire, so be wise!
4) Hard Work Knows No Background
“At the end of the game, the pawn and the king go back into the same box”
It doesn’t matter where you come from, or where you are going, in the grand scheme of things. Hard work can be applied regardless of your background and upbringing. It’s hard work that separates many who were born into wealth from those who strive for it. Hard work sets up average men and women to quickly become above-average in the wealth department.
Whatever you may be doing in your day-to-day right now, hard work applied in the right areas will 110% make a difference for you. Hard work alone certainly won’t propel you to millionaire status overnight. You will, however, be trending upwards in the same direction as many before you who made it to the million dollar club. Work hard, work smart, reap the rewards over time.
5) Avoiding a Single Point of Failure
Living wealthy is all about avoiding unnecessary risk in your life while maximizing the upside. In software sales, we often reference the term “single point of failure”. When talking about websites, this means a single cog in the platform that could take everything down if it fails. A single point of failure is a HUGE risk for companies who need their website up and active at all times.
When we talk about a single point of failure on our road to financial freedom, I’m talking about something different. Having only one source of income is your single point. If your job was eliminated tomorrow, would you be able to pay the bills? Or would you need to hit the pavement and aggressively start looking for a job to keep a roof over your head?
Having multiple streams of income is extremely common for any young millionaire you come across. A fall back plan if your main source goes awry is critical. We’ve got plenty of tips on how to diversify your income and get multiple streams set up. Optimize this and making the million dollar mark by 30 becomes even easier.
What’s Holding You Back?
Getting to millionaire status by the age of 30 doesn’t have to be a fairy tale. The earlier you get started, the easier it becomes. Set yourself up for financial freedom and a high net worth by living these five tips to become a millionaire by 30 every day.
Want to take your learning to the next level? Try our FREE Wealth-Building Course.
Until next time. I am off to Russia for the next two weeks at the World Cup.
All opinions expressed on this blog are solely those of Home at 30 and are in no way affiliated with any other organization or institution. The purpose of this blog is to give general education and information about investing, wealth, careers, and college; It is not intended to be professional advice.
Author: Joe Savoia
Joe is a 2014 graduate of Northeastern University and currently works in a field sales role for technology company Acquia. He has worked internationally as one of Acquia’s earliest Australia-based employees and helped in the early stages to develop that region. Today Joe is based out of Boston and lives in Somerville, MA. Joe’s primary interests vary widely, including everything from robotics/AI to finance, blockchain, and the rapidly evolving world of tech we live in.