How you could become a millionaire before 50

As I was telling my friend about how my primary goal is to be a millionaire, he looked at me as if I was crazy and simply wished me luck. Although being a millionaire is not easy, I sincerely believe it is possible. The purpose of the article is to show how an average Joe like myself or readers of my blog could be a millionaire.

First of all, let me clarify that it is extremely difficult to become a millionaire before 50 by simply saving cash. Assuming that you start working around 20, you would somehow have to manage to save over $30,000 annually. I believe this is not very attainable for most middle-class.

In order become a millionaire before 50 without living with your parents or winning a lottery, you need to invest your savings and get compound returns. It is surprisingly difficult to find a good video about compound interest but here is a clip:

With the help of compound interest in your investment, becoming a millionaire becomes a lot more achievable. You can use online calculators to test out various assumptions to see how you could become a millionaire.

I believe the assumptions are more or less reasonable.

I believe the assumptions are more or less reasonable.

Annualized return of S&P 500

Annualized return of S&P 500

Assuming that I add $500/month to my current 80K investment and earn 10% total return, I should be a millionaire around 50. 10% total return may be somewhat ambitious but considering that historical return (CAGR) of S&P 500 is about 10%, it should be possible. Besides, I’m planning to save more than $500/month as my income increases over time, I should be able to be a millionaire before 50.

Curious of if I could actually be a millionaire? or you want to find more investment tips and value investing strategies to become a millionaire yourself? You can follow/support my blogs by:

  1. Like, follow and share my facebook page!

  2. Like, follow and share my twitter account and posts!

  3. Subscribe to my blog in my home page!

  4. Feed your RSS feed by using the URLs below!

Have a child in Canada? Get over $500/year in 4 simple steps!

As my wife got pregnant (yay!), I started to do some research to prepare for my baby’s future. As I was doing some research, I found a way to get significant savings for the baby’s future and wanted to share with fellow parents/parents-to-be.

Assuming that your kids will one day go to college/university, the parents would need to save decent amount of money for the upcoming tuition (unless they are planning to let the kids have student loans). RESP (Registered Education Savings Plans) is a great tool to do so.

Here is the 4 simple steps to get over $500/year:

(1) Get a SIN for your kid.

(2) Open a RESP account with a bank or other financial institutions, registering your child’s SIN to associate with the account.

(3) Deposit $2,500/year into the account. Invest the money in your preferred investment vehicle (e.g. stocks, EFTs, bonds, GICs, etc.)

(4) Canadian government deposits $500-$600* (depending on your income) into the account.

The above figures may change depending on the government’s policy. Check here for the latest info. Think of RESP as the education version of RRSP, with incentives provided by the government, not the employer. If your income is less than $46K/year, you may also want to check out the Canada Learning Bond. There are additional incentives for those who have relatively low income. This is why I love Canada. Canada is pretty nice to poor people.

My wife laughed at me for how I even started thinking about the baby’s education more than 6 months before she is even born but I am very excited to use this program to get extra savings to prepare for my baby girl’s bright future.

Are you wondering what to invest for RESP? Check out my valuation articles to find great investment opportunities. Follow and subscribe my blog to keep being posted on my latest investment ideas and personal finance tips!!