I Want to Be a Millionaire: Blueprint Guide

i want to be a millionaire

Like many of my readers, I want to be a millionaire. Heck, I even took the millionaire pledge for crying out loud! As part of my pledge, I shared that no one in my family has ever been or is a millionaire. I hope to be the exception to the rule. 

What Millionaires Are Like

Since I want to be a millionaire, I Google about millionaires very frequently. This is what I found.

What most people get wrong is that they think millionaires spend millions. That is not true. Millionaires are notoriously frugal and spend nowhere near a million dollars a year. Billionaires spend millions.

In the media,  we are blown away by Bill Gate’s $123M mansion (appraised in 2014). Or Mark Cuban’s pad, valued at around $17.5M. With this, it’s easy to assume that the rich spend like there’s no tomorrow. However, that is the wrong way to think!

I used to think that millionaires used money to wipe down their kitchen counters and throw it away after single use. Why would I be wrong? They spend millions on just their house in the first place. I couldn’t imagine what other things they spend exorbitant amounts of money on.

I was forgetting that they are bringing in boatloads of money. The ones who spend millions on a house are usually billionaires. 1 million is 1/1000th of a billion. The median household income is around $55,000 (plus or minus 10%). That means that what billionaires spent on a $1M house is equivalent to a median household spending $55. $55 is worth something but it sure is not earth-moving by any means.

I Want to be a Millionaire! The Plan

What did this lesson teach me? Millionaires are frugal. Yes, spending a million on a house is considered frugal. Even then, some billionaires (Warren Buffett), spend (much) less than a million on a house. That’s the #1 characteristic that I realized caused someone to be rich. It isn’t a high income (though it helps), it isn’t smartness, it isn’t the lottery, and it certainly isn’t a trust fund. It’s savings. 

When I first realized this was when I was reading an article about Warren Buffett. He was asked how someone can get rich. He said “saving aggressively.” What! I couldn’t believe what I was reading. A billionaire is advocating someone to save aggressively in order to get rich.

After 4 years of saving throughout college allowing me to have a $40,000 net worth, I am very convinced that that is the path to a millionaire status. Saving is one of the easiest things to do. Why? After getting used to it for about 3 months, it becomes effortless. 

The Blueprint

That’s all I’m going to do. Save. I’m confident that it will get me to the land of millionaires, where money stress is nonexistent and time is dictated instead of time doing the dictation.  It’s not going happen overnight, not by a long shot.

Don’t believe me in words? That’s understandable. That’s why I attached a spreadsheet where if numbers are met every year, I will end up with a million dollars at the latest of 40. I want to be a millionaire so desperately that I revisit this spreadsheet daily. Do I have a personal finance problem? I think so. I probably need to start a personal finance anonymous group.

i want to be a millionaire

These are my assumptions used to calculate the numbers above. At this rate, I’m on track to be a millionaire by the time I’m 39. One whole year ahead of schedule! I start calculating at December of 2016 because that is when I officially turn 22 as Christmas Eve is my birthday.

i want to be a millionaire assumptions

Income is the starting income (what I currently earn today), the income increase is the yearly salary increase I hope to attain, savings rate is calculated as a gross number (so 43% of pre-tax dollars $54,300 would be my first year savings), and the stock market will average a 7.5% return over the next 18.25 years. These are the assumptions I used to plug the numbers in above.

Assumptions Beyond Numbers 

Other than the numbers it took to derive the millionaire number, there’s important assumptions to note as well (positive and negative). Instead of being blindly optimistic, studies have shown that being optimistic while considering the possible bumps in the road leads to actually following through. 

Therefore, I thought of the positive and negative things that could happen during my way to a million. I want to be a millionaire and I don’t want over-optimism to be the reason why I can’t be one. The positive assumptions skew the projections to be more positive than it actually could be. The negative assumptions do the opposite. 

Positive Assumptions Over the Journey:

*I won’t get fired 

*I won’t get divorced

*No over-the-top medical bill

*I don’t pursue a graduate degree

*I don’t have a quarter / mid life crisis and start buying BMWs and Mercedes on debt

*Nuclear power doesn’t become so advanced and wipes out the human race

*The stock market returns 7.5% over the next 18.25 years 

I am hoping that I get lucky and my positive assumptions turn out to be true. Any of these things gone wrong could halt everything that I’m working so hard for. One exception is the graduate degree. I’ve yet to think about whether I should pursue it.

I will move to the negative side, everything that skews the spreadsheet numbers to be less than they should be.

Negative Assumptions Over the Journey

*Starting net worth is $45,000. By the time I get to December of this year, I’m on track to have a higher net worth than $45k. However, it doesn’t hurt to be conservative.

*My future spouse doesn’t work. With women increasing their presence in the workforce at the fastest pace, it’s unlikely that my future spouse won’t be working. However, I don’t want to add in her income to reach FIRE, it’s about being conservative.

*I won’t get promoted. Don’t get me wrong, I will put in my dues, add value to my company, and do everything to be a high performer. Everything that is needed to be promoted. However, I don’t want to model out that I’ll get a promotion every x years or so. A simple smoothed out 2% increase in income every year is fine for projection purposes. 

*I’ll only save 43% of my income every year. I can easily max out my HSA and 401k on a $54,300 income. Especially in Alabama where the cost of living is so cheap. On top of the max contribution to HSA and 401k, I just need to come up with an extra $1,728 to meet my first year’s savings rate of 43%. I will save an extra $4,000 over a full year working just by looking for the best deals.

Boring but Effective

The whole point of this post was to say that I will be a millionaire by saving. That deserves multiple yawns throughout reading this post. I am almost yawning during my time writing this post. If you want to be a sexy millionaire, I don’t have a guide to show you. I don’t know how to be a sexy millionaire.

However, if you want to be a boring millionaire, this is just the guide! It all depends on whether your image is desired or not. For me, I don’t want my image to be a sexy and flaunting millionaire, but a quiet one not looking for any recognition. 

I want to be a millionaire so badly that I don’t care about what kind of millionaire I am (unless it’s through unethical or illegal means).

Readers, do you want to be a millionaire? Do you agree with the guide I set forth? When will you achieve the coveted status? Let me know your plans below!

Finance Solver

I grew my net worth to $40,000 as a college student through hard work, discipline, and a little bit of luck. I graduated college in 2016 and will be starting to plan for my retirement once I start working.I am planning on reaching financial independence by my early 30's and I will document my moments of inspiration all the way to desperation here.

My goal is to enable your success in personal finance so that you can realize the American dream. The first step is starting today!

Read more about me here.

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20 thoughts on “I Want to Be a Millionaire: Blueprint Guide

  1. The lessons that you lay out here are pretty much the lessons I learned from reading the Millionaire Next Door. We always assume that the people spending a lot must be the rich people. Instead, it is often the people driving around in old used cars and living in unassuming houses that are actually the millionaires. It does appear that most people who become millionaires take the slow, boring approach.

    • Finance Solver says:

      I didn’t even know the Millionaire Next Door preached what I wrote about, that’s great that I’m at least thinking in the direction of an iconic personal finance book! I hope my coworkers understand that. Every single one of them judges me and calls me cheap for having such a high savings rate but I want to see how it plays out 10 years down the road. Maybe I’ll be happy that I lived in such a way and maybe I won’t. Only time will tell!

  2. I think most people would benefit from being more “boring” when it comes to finances. I think the biggest challenge that most millennials face is getting to zero after piling on student loan debt throughout their college years.

    • Finance Solver says:

      That’s true. I’m fortunate to not have any debt under my belt after graduating from college. That’s why living the student life even after college can be a fantastic way to live to get back to 0!

  3. I use to do the exact same thing when I was younger. I think I’ll be able to reach FIRE by 2020 which is within the time frame of my chart. Just goes to show you that if you stay disciplined that you will reach your goals, especially if you pick financially boring investments 🙂

    • Finance Solver says:

      Nice! You’re so close to achieving it!! I hope my discipline doesn’t fade away, because it’s so easy to lose sight of your goal and be fatigued of it..

  4. B says:

    Hi Finance Solver

    The true rich person doesn’t buy the things they can’t afford to impress the people they don’t like. The true rich person is all in the mind. It is incredibly amazing to know that it is not impossible to reach that millionaire status just by doing the very basic 101 way. A lot of people get greedy and want that gratification right away, which they need to pay off at some point in the future.

    • Finance Solver says:

      I agree completely. There was a marshmallow experiment where they gave a marshmallow to a kid who could practice delayed gratification and one who couldn’t. The one who was able to delay their gratification did better in life than the counterpart. A simple act that has a big impact!

  5. That’s a great blueprint, FS! You’re not alone, I’d be a good fit for the personal finance anonymous group as well and have made my own spreadsheet just like yours. I track it pretty religiously and while the market won’t perform as you wish every year, have faith it will in the long-term.

    Another thing I found was that a 2% income growth is conservative when considering big promotions come occasionally which will allow you to take big leaps and shave off some years to the plan. Just keep working hard and I’m sure they’ll come.

    Looks like some conservative assumptions (more conservative than mine) so kudos to you and you’ll get there in no time!

    • Finance Solver says:

      Thank you so much JW! I think everyone who reads personal finance blogs are a good fit for the personal finance anonymous group, ha! I will try to have faith. At times it’s hard (Brexit anyone?) but the eventual rebound makes me giddy that I didn’t panic sell.

      I hope so! I’m hoping a promotion will come around every 3 years or so but I haven’t navigated through my career enough to know a good rule of thumb to follow.

      Thank you! You can hold me accountable to my goals 😉

  6. I think it’s really great you know what you want at 21 and have a plan to achieve your goal. Though you may have to adjust your goal amount due to cost of living and inflation. A million dollars 20 years from now would have much less buying power than today.

    • Finance Solver says:

      That’s so true. I haven’t adjusted for cost of inflation in my projection. I know a million won’t be the same 20 years from now but I would still love to have a million nonetheless!

  7. I am amazed by your diligence and maturity at 22. I have a spreadsheet where I have been tracking my progress almost on a daily basis as you are. There is nothing wrong with it. It just shows how passionate you are in your pursuit.

    Lastly, you are very conservative when it comes to salary growth. In fact, I would say you should lift it up. In fact, you should challenge yourself to boost your salary a certain percent every year and or promotion.

    Goals drive behavior – have loftier salary goals, it certainly helps. It has certainly helped me.

    • Finance Solver says:

      Thanks a lot Michael, it means a lot to me! I don’t know if it means I’m too serious of a person to pursue these goals, but I don’t think so, which is why I’m happy with the goals that I’ve set out for myself.

      I tried to be as conservative as possible. I didn’t want realistic expectations and have an unforeseen event take all of that away. I’m going to try hard to get that promotion and move up the ladder but I wanted to see the latest that I could become a millionaire if all that doesn’t pan out. Only time will tell how conservative or liberal my assumptions were going forward!

  8. You bet we want to be millionaires 🙂 I reckon we will get there at about 35 years old (about 10 years away if all goes well).

    I am really sure you will get there FS, you know what it’s going to take, you have a good plan to get there and you are also aware of negatives that may happen.


    • Finance Solver says:

      That’s great Tristan! I will also be following your blog to keep you accountable as well 😉

      I hope so! There’s still some things that could happen beyond my control that makes the schedule go a little later than expected. Hopefully it’s not so devastating.

  9. You’ll get there. Earlier than planned I suspect. 2% is a low number for annual salary increases. Also, who knows, a family, a second income, 401k match. You’ll get there early. Then I suspect, you’ll shoot for $2M!

    Happy birthday.

    • Finance Solver says:

      Thank you!! I turned 22, time doesn’t seem to stop for anyone :'(. I’ve been hearing that 2% is a low number for annual increases, but I wanted to stay as conservative as possible and to be at least be able to keep up with inflation. I actually got more than a 50% raise this month so I will be updating my blueprint soon enough!

  10. Angel says:

    What you are doing is incredibly impressive — especially at such a young age! I wasn’t able to aggressively save until I was 26 (I’m now 30) but it has been amazing to look at the progress.

    • Finance Solver says:

      Thank you! I’m glad to have been given opportunities to actually figure out what I wanted in life (at least, as far as money goes). My family has never been close to being a millionaire status and darn it, I will be the first to set an example!

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