How to be a Millionaire before 40!

Have you ever wondered what it takes to become a millionaire while you are still young?

While it might seem a no brainer for your average FI (financial independence) fan, the average person just isn't aware of how simple it is. I think the reason for this is just because it's not something that's commonly taught, a case of the middle class mindset which is seemingly inescapable.
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In a previous job which was quite a low paying job where most of the employees thought you were rich if you paid cash for a car, they used to ask me if I though I was going to be a millionaire (because they knew I was an investor).
"Of course!", I would reply, "It's a mathematical certainty!"

So let me lay out just one example how a young person can become a millionaire by age 40, or an older person within 20 years instead of the usual "work for 45 years" which is the norm.

At an average (below average in Australia) wage of $40,000 and a savings rate of 50%, regularly investing into index funds that return 10% over the long term, you will have $1.15 million by the age of 40.

You can now retire a millionaire!

Of course most of the growth happens at the back end, so if you kept working until 50 you'd have $3.3 million. Our you could work part time from 40 (enough to cover your lifestyle) and keep the investments going and fully retire at 50 on $2.97 million.

Of course the possibilities are endless, and with a higher savings rate you can retire within 10 years or even as little as 5!

The main points are that you should save something and invest it and you'll be fine over the long term, but the goal is to bring this forward as much as possible with a higher savings rate.

Don't forget to follow me on Twitter @EarlyRetireAus or send me an email at earlyretirementaus@gmail.com

Don't forget to leave a comment!
Peace.
E.