So you want to be a millionaire by the time you retire, is it possible? Yes, yes, yes…if you work at it. Every millionaire started with financial basics. Every millionaire first achieved financial fitness and you can too.
Wealth is the result of your hard work, your financial habits and your self-discipline.
Tips On How To Become A Millionaire
Tip #1 – Improve Credit Score
Low credit scores, range from 300 to 750. If you have low scores you will have less money for investing. If you work on improving your credit score, you will save a lot of money on fees and interest.
The reason you will have less money for investing is because with low credit scores you will be charged the higher interest rates on your loans; auto loans, student loans, mortgage loans. With low credit scores, insurance companies will charge you the higher premiums.
With low credit scores, the financial industry will basically own you. If you improve your credit score to above 750 or higher you will not be controlled by the financial industry.
The extra money you will save by avoiding late fees and high interest rates can be invested in your retirement accounts.
Tip #2 – Improve Your Spending Habits
Financial planners will tell you that it’s not what you earned throughout your career that will count at your retirement, but instead it’s about how much you kept. They will tell you that half of your journey towards becoming a millionaire is your self-discipline with spending. What did you do with the money you earned?
When your goal is to become a millionaire, what you do with your money is what really matters. Do you save it or spend it? Do you buy things you need or want? Do you shop or just buy? Do you clip coupons or pay full price for everything? Do you buy cafe lattes when you could make coffee at home? Do you waste money on high interest rates or late fees due to bad credit scores?
Remember, it’s not what you make but what you keep that matters. Your spending habits either leave you with more money or less money; it’s all up to you.
Tip #3 – Improve Your Saving Habits
Millionaires save, save and save; they are compulsive savers. Financial planners will tell you that the other half of your journey towards becoming a millionaire is your self-discipline with saving. Your saving habits and spending habits have a common thread; you can save money by how you spend.
Some Good Saving Habits
- Avoid debt, it costs too much.
- If you cannot afford an item, don’t buy it.
- Do not carry a credit card balance.
- Avoid expensive habits, ie, smoking.
- Only buy large ticket items when they go on sale.
- Save your raises and bonuses, you lived before without them.
- Maximize your 401k contribution limits, especially if you get free money from employer matching.
- Pay extra money on your mortgage each month.
You have the capability to save and spend your way to becoming a millionaire; you just need to make the commitment to do so. Improve credit scores, adjust your spending habits and fine-tune your saving habits are the financial basics.
