ANYONE can become a Millionaire!
It’s probably no surprise, but wealthy people understand how money works. Somewhere along the way, someone taught them basic fundamentals to creating wealth... someone taught them the SECRET to becoming a millionaire.
Unfortunately, most people are never taught. Currently only eight states in the United States have state-wide requirements for teaching financial literacy in high school. While that statistic may come as a surprise, the reality for most people is that much of their financial literacy must come from parents, families, or friends.
If you were never taught, don’t worry. We’re going to share the fundamentals. We’re going to share the SECRET! And the good news is... the SECRET is fairly easy to learn!
Those who study how money works have a greater chance of becoming wealthy!
The Basics to Building Wealth:
The easiest path to building wealth is to SAVE a small portion of your income, then INVEST your savings in stocks and/or mutual funds that have a history of good performance. Saving money takes some discipline, but pays off in a big way over time. Below are 3 basic concepts to understanding how wealth building works, and why you should invest... NOW.
1. Compounding
The power of Compounding refers to the growth potential of money over time. Compounding is when the gain you earn on investments is reinvested, earning you more. It’s money making money, and the money that money makes, also makes money. Compounding makes your money grow faster, creating a snowball effect, as the original investments plus the income earned from those investments grow together. It’s like your money going viral, or exponential growth. Albert Einstein called Compounding “The Eighth Wonder of the World.” Over time, a small investment can grow to a very large amount of money. For example:
- Investing $180.00 per month for 45 years (with a 9% return) can grow to approximately $1,000,000.00
- Investing $500.00 per month for 45 years (with a 9% return) can grow to approximately $3,500,000.00
2. Time Value of MoneyTime is Money. A sum of money is worth more now than the same sum will be at a future date, because of its potential when invested with a good Rate-of-Return. Begin saving and investing NOW. Here are several different examples of how time can make a huge impact on savings, if left invested until retirement:
3. Rule of 72Investments that offer a higher rate of return, over time, will grow your money faster. The rule of 72 is a math shortcut...
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Some interesting Personal Finance facts.
- You do NOT have to make a million-dollar salary to become a millionaire.
- You do NOT have to save a million dollars to become a millionaire.
- You do NOT need a college education, or advanced degree, to become a millionaire.
- Most people worry about money, and live pay-check to pay-check.
- Two thirds of all the people in the world are financially illiterate, and consequently poor. Most people work for money. Wealthy people put their money to work for them.
- 40% of Americans have NO savings, and can’t pay for a $500 emergency.
- Social Security will NOT cover all living expenses in retirement.
- Most schools in the U.S. do NOT teach Personal Finance.
- Personal Finance is NOT complicated. 7th grade math skills are all that’s required.