At first glance, reaching the $ 1 million threshold might seem
impossible, but it's easier than you think. The salary is very important, but
more important is the way you use it, writes Entrpreneur.com. Raising a fortune
of $ 1 million will require sacrifices on your part, but it is not an
impossible goal to achieve.
Here are the best ways to become a millionaire.
1. Increase your profit margin
A profit margin does not only refer to business, but can be
applied to anyone. "By increasing the margin between what you earn and
what you spend, you make a profit exactly like a company," says JD Roth,
author of the personal finance site Money Boss. He suggests saving half your
salary each month. He recommends for a family with two incomes to live on only
one salary, and to save the other.
2. Start with $ 10 million
It's a joke that shows how brains tend to fool people when they
make investments. Kirk Chisholm, head of the consulting firm Innovative
Advisory Group, says it's not hard to earn $ 1 million by investing, if you're
young and avoiding crowds. "Create a solid investment plan, invest when
the market is down and over time you will become a millionaire," he says.
Those who tend to buy and sell more often tend not to perform as well as those
who buy and hold shares, according to Vanguard research.
It is also very important to start investing early. The longer you
are late in investing, the harder it will be for you to reach the desired
amount.
3. Turn your passion into a business
"Find something that you are passionate about and become an
authority in the field, and then make a business out of it," says Joseph
Carbone, consulted at Focus Planning Group.
The success of Chipotle proves this. In 1993, Steve Ells, the
founder of Chipotle, wanted to open a luxury restaurant. He had no money, so he
borrowed a sum from his father, with whom he opened the first Chipotle.
Everything to earn enough money to open his luxury restaurant. He sold 1,000
burritos in the first month, and his passion for luxury cuisine changed to his
passion for fast food.
4. Invest in real estate
If you have some money set aside you can invest in an apartment or
house in a cheaper area that is about to gain popularity and will grow in the
future. After you have managed to get rid of the home loan, you will totally
own the property. In the meantime you can rent the house or sell it after you
have paid the loan.
5. Change your lifestyle
"Many people who live in luxury homes and drive expensive
cars do not have much money. I discovered that rich people do not tend to live
in exclusive neighborhoods, "say the authors of Millionaire Next Door.
Authors Thomas J. Stanley and William D. Danko found that high wages did not
mean high fortunes, the rich living frugally, spending little.
6. Choose a lucrative job
It may seem obvious, but if you want to build a considerable
fortune then you have to earn a high salary. If you only earn enough to make a
living then you will never become a millionaire.
Mark Cuban has found ways to make money since he was little. He
had his first business experience at the age of 12, when he sold garbage bags
to buy a pair of basketball shoes. He also had several jobs throughout college,
such as bartender, disco dance instructor or party organizer. He sacrificed his
free time to fulfill his dream.
7. Invent something
Sara Blakely invented Spanx modeling stockings. Today his company
has a turnover of 250 million dollars. The idea for the Spanx company started
from the tights that Sara had to wear when she worked as a fax sales agent for
the Danka company. On the one hand, the modeling stockings embarrassed her, and
on the other hand they made her look more attractive, thinning her body.
Blakely came up with the idea of legless tights, taking a big risk once he
invested all his savings, worth $ 5,000. However, he kept his job, selling
copiers for another two years, spending his nights and weekends making the
prototype.
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