9 things to do in your 20s to become a millionaire by 30

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One Easy Step to Becoming a Millionaire

Becoming a millionaire by 30 is possible, and you don't have to found the next Facebook or Snapchat or win a Powerball jackpot to do so. Plenty of regular people have done it.

To help you reach the seven-figure mark, we rounded up nine pieces of advice from people who became millionaires at a young age. We can't guarantee millionaire status, but doing these things won't hurt your odds:

1. Focus on earning

"In today's economic environment you cannot save your way to millionaire status," writes Grant Cardone, who went from broke and in debt at 21 to self-made millionaire by 30. "The first step is to focus on increasing your income in increments and repeating that.

"My income was $3,000 a month and nine years later it was $20,000 a month. Start following the money, and it will force you to control revenue and see opportunities."

Earning more money is often easier said than done, but most people have options. Read about 50 ways to bring in additional income, some high-paying jobs you can do on the side, how you can earn passive income, and how to start a side-hustle from a woman who earned up to $4,000 a month on the side.


2. Save to invest, don't save to save

Writes Cardone:

The only reason to save money is to invest it. Put your saved money into secured, sacred (untouchable) accounts. Never use these accounts for anything, not even an emergency. This will force you to continue to follow step one (increase income). To this day, at least twice a year, I am broke because I always invest my surpluses into ventures I cannot access.

Investing is not as complicated or daunting as we make it out to be. The simplest starting point is to contribute to your 401(k) if your employer offers one, and take full advantage of your company's 401(k) match program — which is essentially free money — if it has one.

Next, consider contributing money toward a Roth IRA or traditional IRA, individual retirement accounts with different contribution limits and tax structures — which one you can use depends on your income. If you still have money left over, you can research low-cost index funds, which Warren Buffett recommends, and look into the online-investment platforms known as "robo-advisers."

The key to consistently setting aside money is to make it automatic. That way, you'll never even see the money you're contributing and you'll learn to live without it.

3. Ask for help.

"At a certain point in my business, I couldn't grow any further until I hired a few key people," writes Daniel Ally, who became a millionaire in less than five years, at the age of 24. "Asking for help wasn't my forte, but I had to make it happen. Within months I had a lawyer, editor, personal trainer, part-time chef, and other personnel. It cost me a fortune at first, but eventually helped push me into the million-dollar mark. Most people won't ask for help because their ego is in the way."

Asking for help extends beyond hiring key people. As self-made millionaire Steve Siebold explains in his book "How Rich People Think," rich people aren't afraid to fund their future from other people's pockets. "World class believes in using other people's money," he writes. "Rich people know not being solvent enough to personally afford something is not relevant. The real question is, 'Is this worth buying, investing in, or pursuing?'"


4. Be decisive.

"Avoid decision fatigue," writes Tucker Hughes, who became a millionaire by age 22. "Attention is a finite daily resource and can be a bottleneck on productivity. No matter the mental stamina developed over time, there is always going to be a threshold where you break down and your remaining efforts for the day become suboptimal.

"Conserve your mental power by making easily reversible decisions as quickly as possible and aggressively planning recurring actions so you can execute simple tasks on autopilot. I know what I am wearing to work and eating for breakfast each day next week. Do you?"

Hughes isn't the only one who believes in developing decisiveness. After studying over 500 millionaires, journalist and author Napoleon Hill found that they all shared this single quality. "Analysis of several hundred people who had accumulated fortunes well beyond the million dollar mark disclosed the fact that every one of them had the habit of reaching decisions promptly," Hill wrote in his 1937 personal finance classic, "Think and Grow Rich."

5. Don't show off — show up!

"I didn't buy my first luxury watch or car until my businesses and investments were producing multiple secure flows of income," writes Cardone. "I was still driving a Toyota Camry when I had become a millionaire. Be known for your work ethic, not the trinkets that you buy."

Need inspiration to save more and spend less? Read up on tips and strategies from regular people who saved enough of their incomes to retire before age 40.


6. Know when to take the right risks — and act on them.

"Before reaching the seven-figure mark, you must take many risks," writes Ally. "Taking risks requires much faith in yourself and others, but it must be done. Faith is knowing that what you want will eventually happen as long as you believe it. You'll have to take major leaps in your life, sometimes not even knowing where it will lead. However, it will pay off once you get to the other side, even if you burn a bridge or two in the process."

You can't get rich with low expectations — the wealthiest, most successful people think big and play to win.

While playing to win in any aspect of life requires an element of risk taking and a level of comfort with uncertainty, it could be the difference between living an average life and living a rich life, says self-made millionaire T. Harv Eker, who also studied incredibly wealthy people before releasing his book "Secrets of the Millionaire Mind."

7. Invest in yourself.

"The safest investment I've ever made is in my future," writes Hughes. "Read at least 30 minutes a day, listen to relevant podcasts while driving and seek out mentors vigorously. You don't just need to be a master in your field, you need to be a well-rounded genius capable of talking about any subject whether it is financial, political or sports related. Consume knowledge like air and put your pursuit of learning above all else."

Many modern-day successful and wealthy people are voracious readers. Take Warren Buffett, for example, who estimates that 80% of his working day is dedicated to reading.


8. Master soft skills and cooperate with others.

Building a fortune takes people skills and charm just as much as it does strategy. As Hill warned, "Most people lose their positions and their big opportunities in life because of this fault than for all other reasons combined." And billionaire Mark Cuban put it bluntly in an Entrepreneur article about the keys to being successful in business: "People hate dealing with people who are jerks. It's always easier to be nice than to be a jerk. Don't be a jerk."

That being said, there is a fine line between cooperating with others and being a pushover. "In the process of reaching the seven-figure mark, I've learned dealing with people is the most important attribute," writes Ally. "No one can become a millionaire without knowing how to deal with people assertively. You must be prepared when your best friends turn on you or your family betrays you. Sometimes, it will happen at the most unpredictable times."


9. Shoot for $10 million, not $1 million.

"The single biggest financial mistake I've made was not thinking big enough," writes Cardone. "I encourage you to go for more than a million. There is no shortage of money on this planet, only a shortage of people thinking big enough."

Related: 7 ways to invest to become a millionaire
10 ways to invest to become a millionaire
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9 things to do in your 20s to become a millionaire by 30

Include taxes in your tally. 

Withdrawing money from retirement accounts is, of course, not a free ride, so $1 million gross is not $1 million net. “If the $1 million were in a traditional 401(k) or IRA, all withdrawals would be taxable,” says Christine Pavel, vice president of wealth management at GCG Financial in Deerfield, Illinois. “You also have to consider how much the investor will withdrawal from the portfolio, and for how long.” Assuming 3 percent inflation, looking forward 30 years and accounting for retirement account taxes, “An investor would be lucky to be able to withdraw $20,000 or less from the account for 30 years,” she says. 

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Compounding counts. 

If you're in your 20s and start investing now, you’re in luck, says Joe Jennings, wealth director for PNC Wealth Management in Baltimore. “Due to the power of compounding, the first dollar saved is the most important, as it has the most growth potential over time,” he says. As an example, Jennings compares $10,000 saved at age 25 versus age 60. “The 25-year-old has 40 years of growth potential at the average retirement age of 65, whereas $10,000 saved at age 60 only has five years of growth potential,” he says.

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Consider annuities as a building block. 

Annuities, which people purchase to get an expected payout once they reach maturity – usually at or after retirement age – also have a rough reputation, particularly indexed annuities. But last year’s Qualified Longevity Annuity Contract regulation by the IRS set guidelines for investors to create their own pensions. “You can invest and put money in a retirement account, and with annuity guarantees that you will never outlive your money,” says Stan “The Annuity Man” Haithcock, an annuities expert and author of the book, "The Annuity Stanifesto," based in Ponte Vedra Beach, Florida.

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Safety first. 

It may seem sexier to get in on the latest initial public offering or that new stock your Uncle Mortimer promises will take off. But that’s no way to build a nest egg through the years, says Jim Merklinghaus, founder and president of JBM Financial in Rutherford, New Jersey. “My philosophy has been a conservative approach to retirement, investing consistently over a 30-year period of time. If your principal is 100 percent safe, you have already accounted for 12 years of a normal 30-year retirement. The plan that avoids the loss of principal far exceeds the joy of temporary returns,” he says.

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Diversify between companies large and small. 

Risk tolerance and portfolio mix are major factors in getting to $1 million, and they’ll differ depending on the investor. But if there’s one universal that applies, ”The portfolio should be diversified among large- and small-company stocks, domestically as well as in established foreign countries and emerging markets,” says Kenneth Moraif, senior advisor at Money Matters in Plano, Texas. “The appropriate allocation in each of these asset classes will be determined by the investor’s time horizon, their current assets, age and tax bracket.” 

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Use that 401(k) all the way. 

Since retirement is the major savings goal with most nest eggs, make sure you maximize your retirement savings, says Andy Saeger, vice president and senior financial consultant at Charles Schwab in Naperville, Illinois. “Max out your 401(k) or other employer retirement plan, especially if you receive matching contributions. If you're age 50 or older, make catch-up contributions. If you can afford to save more, you may be eligible to open and contribute to an IRA, where your money can grow tax-deferred or tax-free until retirement,” Saeger says.

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Thou shalt pay thyself first

What used to be simple, sound advice is more of a commandment when $1 million or more is the goal. “If you make the financial plan first and then build your life around it, the outcomes are typically very positive,” says Mike Chadwick, CEO of Chadwick Financial Advisors in Unionville, Connecticut. “Most people do the opposite: They set up their life and then try to save after the fact, when it’s painful to do so. When something is paid off, save the extra money and you won’t feel the pain. And when you get raises, save the money until you’re on target.”

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Avoid the temptation to spend first. 

Most investors, especially in their younger years, think they can easily make up for copious spending and shopping. “This is certainly possible, but will require a potentially difficult, if not impossible, return on the investment or a significant increase in savings,” says Bellaria Jimenez, managing partner with MetLife Premier Client Group, based in Cranford, New Jersey. ”Investors must ignore temptations to spend and instead save.”

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Patience, patience, patience. 

Just as it takes years to get to retirement age, you’ll want to stick it out, as some investments hit expected bumps. “Over a typical working career, an investor can expect to experience at least eight to 12 poor market years,” says Jakob Loescher, a financial advisor with Savant Capital Management and based in Rockford, Illinois. “During these years, it’s important that the individual remain patient and not make any large market-timing mistakes.”

(Photo: Getty)

And finally, answer the $2.3 million question. 

That’s how much money you’d need in 2045 to have the same purchasing power as $1 million today, assuming a 3 percent annual inflation figure. So how do you get to $2.3 million? “Assuming a starting account value of $50,000 and an 8 percent return on assets, an investor would need to deposit $13,500 at the beginning of each year over the next 30 years to achieve that result,” says Andrew Gluck, managing director of wealth management at GCG Financial.

(Photo: Getty)


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