The Truth About Making Your First Million Dollars

By: ispeculatornew
Date posted: 11.23.2011 (5:00 am) | Write a Comment  (2 Comments)

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I think it’s fair to say that a million dollars is nowhere near what it used to be. Inflation and time have transformed an amount that not too long ago seemed astronomical, impressive and enough to live off of for decades into an amount that many consider merely a beginning to their retirement. Chances are that your “number”, the amount of money you need to save up in order to live at the level that you hope and expect to be is likely significantly higher than $1 million.

Feels Like Such A Difficult Challenge

I know, I know, to many of you, including myself up until a few years ago, reaching the 7 numbers seemed extremely challenging if not impossible. As years go by, it is becoming a lot less of an illusion and feels much more like a milestone that I will reach at some point in the next 2 decades if all goes well.

What Changed?

As someone that writes about dividend investing, technology stock picks, the importance of earning money, I’d certainly love to tell you that the secret behind most millionaires is their incredibly ability to trade and to generate solid and consistent returns. I’d love to tell you that it’s the most important thing in the world. In reality though, it simply would not be true.

It’s So Much More Simple Than That

Becoming rich can certainly be helped by getting a promotion, finding a new job, starting a business, making some great investments in the markets, real estate or any other asset. The reality however is that becoming a millionaire isn’t so much about that as it is about something else. Spending less than you make every year and consistently increase the amount that you are saving.

It’s not complicated, not pretty, but that’s the reality. When you say athletes or business people that are making millions of dollars every year and still manage to go bankrupt years later, it’s simply because they were overspending. And you probably know tons of people around you, some that make a lot more but also spend that entire extra amount.

Be Careful Of Shortcuts

Yesterday I discussed leverage and how dangerous it is. Using some leverage or taking some risks on certain investments or moves can be a good idea but it’s important to only risk what you can actually afford to lose and to avoid “over leveraging yourself”. It’s easy to push further and further once the process has stated but rarely a good idea.

How I’m Going About This

Every year, I do my best, through investing, my job and additional cash flows, to increase my income. Then, I take a portion of that amount to increase the amount I save every month/year. It’s that simple. Obviously, I then do my best using my bucket system to increase my investments in dividend stocks, technology long & short picks and longer term speculative picks.

Simplicity Is So Easy To Forget

I know, this post is nothing unique.. Sometimes however, I feel like we try to make things so much more complicated than they should be. The basics are things that we know but we often need reminders.

What Is Your Plan To Reach Your First Million Dollars?

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  1. Comment by Bret @ Hope to Prosper — November 23, 2011 @ 11:53 am

    My plan to save a million dollars is the same as yours and most others who have done it. I have been saving and investing since I was 21 and I have 20 years left to go before I reach my retirement age. Barring a financial catastrophe, I shouldn’t have a problem.

    It really is that simple if you want it to be.

  2. Comment by Intelligent Speculator — November 23, 2011 @ 7:45 pm

    @Bret – Awesome, love to hear that:) Keep it up! Any special tips that I and others could use?

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