5 Ways To Make A Million

Everyone’s dream is to make big money. Enough so that all your financial worries fade away. To live on easy street rather than struggle street.

That magical million dollars seems to be the common dream. Getting it is the problem.

But talk to those who have and many say that all it takes is discipline and focus.

Okay lets focus and go through 5 ways to make a million.

1) The Easy Way

Okay you can always dream and sometimes is comes off for a lucky few. That unexpected windfall which changes your life overnight. But the odds of it happening to you are so long that it really isn’t worth considering except for a bit of fun.

By all means keeping being part of the work Lotto syndicate for a bit of fun. Just don’t count on winning.

Marrying someone rich could be an option and you read of a lot of people who’ve done just that. Call us old fashioned but love is worth a lot more than money and life’s too short to marry someone just for their bank balance.

An inheritance can also be a quick way to a windfall. But with relatives living a lot longer these days, and spending a more in retirement, inheritances are generally smaller despite more valuable houses.

2) Start early and be disciplined

So forget the easy way of inheritances and lottery wins, you need to focus on sure fire ways of making a million.

The key is time and discipline. Putting a little away on a regular basis and letting it grow.

Start your million dollar savings program today.

For example, deposit $5000 in to an online savings account (earning 6.5 per cent) and commit to adding $300 a week to that account.

If it’s hard to find that extra $300 a week you may need to try and earn extra income through a second job, change of career or by setting up a little business. We have some ideas a little later. Keep reading.

So a $5000 deposit and an additional $300 a week will turn in to $1 million after 25 years.

Some people follow the same strategy of investing regularly in to the sharemarket or borrowing to buy investment property and paying down the loan to manageable level.

Shares and property can provide a better return, and a quicker way to a million dollars but it also comes with more risk.

3) Salary sacrifice more into superannuation

The current 9 per cent compulsory superannuation contribution by the boss is simply not enough to sustain most people’s lifestyle in retirement. The answer is to salary sacrifice an extra 9 per cent.

By salary sacrificing, that extra contribution comes out of your before tax wage so every dollar is working hard.

A 21 year old on $60,000 a year who salary sacrifices an extra 9 per cent in to a growth oriented superannuation fund ($6300 a year of $121 a week) will have a $1 million balance by age 65.

Because of the attractive tax advantages, superannuation is one of the easiest and quickest ways to build wealth but make sure you’re in a fund with low fees.

4) Change careers and follow the money

We call it the salary lotto except the odds are better. If you’re stuck in a dead end job or industry which has a limited future, don’t be afraid to change to something with more potential.

Increasing your annual salary from $50,000 a year to $100,000 means you’ll earn $1 million over the next 10 years. It can be your best investment.

Now we know you’re asking where do you find these jobs?

Start with the mining industry. The average wage in the mining industry is $149,000 plus all your food and accommodation and mining companies are crying out for staff.

We know a guy in Perth who used to work in real estate (which is in the doldrums) and switched to an unskilled job in the Pilbara at a starting salary of $100,000 which rises to $140,000 if he stays a year. Qualified welders are getting over $200,000.

His week starts when he boards the plane in Perth (free ticket of course). He then works 12 hour shifts for a week (with full board and accommodation) and clocks off for a week when he arrives back at Perth.

These sorts of jobs are all over the country.

Other boom jobs are in industries like IT, aged care and accounting. You may need to go back to school to retrain but it will be a great investment.

5) Sell something others want

Yes it takes guts and yes it can be risky, but for most self made millionaires starting their own business is the foundation of their first million.

Turn a hobby in to a business and start by moonlighting while working for someone else so there is a steady income coming in. Be ethical about it though and make sure you’re not sneakily competing with the boss.

Go to yahoo7.com.au/smallbusiness for some ideas and also how to start.

Comments

0 #1 2011-09-27 23:59

Good tips Kochie, big fan of turning a hobby into a business in particular. Don't know about being able to put away $300 per week they way the cost of living is going at the moment, even $120 could be a stretch over 40+ years but it does get easier if you start early then set and forget.

Not so sure about the mines though mate, those dollars can't last forever and Australia's economy wouldn't go to well if we all end up working for them