How to Retire a Millionaire

There are many ways to become a millionaire by the age of 65. You could win the lottery. A rich uncle you didn’t know existed could die and name you his sole heir. You could invent a new app or popular website. You could marry a millionaire.

Failing these long shots, you could do it the old-fashioned way: strategize. Make a plan and stick to it.

Billshark would like to suggest these time-tested strategies that—if implemented early and adhered to consistently—could start you on your way to that dreamed-of goal.

1. Start saving at as young an age as possible. When you’re in your twenties, 65 likely seems a long way off, but trust us, it’ll be here before you know it. According to U.S. News and World Report, if you start saving about $400 per month at age 25 and earn seven percent in annual investment returns, you’ll have a retirement nest egg of just over $1 million at age 65. If you wait until age 35, you’ll have to save more than double that to achieve the $1 million mark.

2. Avoid the tax refund. As this is tax season, let us remind you that if you’re getting a hefty refund on your income taxes, you’re lending money to the government that you could be saving and investing throughout the year. Some people view their large tax refund as forced savings, but it makes far more sense financially to put that money to work for you. What you want is to get back as close to nothing as possible. Talk with your HR representative to adjust your deductions to make this happen.

3. Take advantage of your 401(k). Make sure you contribute enough to receive your full employer-match. Each plan differs at different companies, but if your employer matches 100% up to six percent of your income, you’d be leaving money on the table if you contribute less. If six percent is too much, start with one percent and increase your contribution by one percent every six months until you hit the full employer match. (Most financial planners recommend a savings rate of 10%-15%, so six percent is actually the minimum goal.) And put every raise into your 401(k). If you don’t see it, you won’t miss it. And remember that 401(k) contributions come out of your pre-tax income, thus lowering your annual tax rate.

4. Watch out for fees. In addition to deciding on your asset allocation and adjusting it only once every decade as you age (i.e., don’t panic every time the stock market drops), keep an eye on management fees. According to CNN Money, the fees you pay to manage your account could end up costing you as much as $100,000 over the course of your career. They recommend sticking to index funds, which mirror overall market movements and tend to carry fees of less than one percent, while actively managed funds can charge two or three times that amount.

5. Turn to Billshark. If you say you don’t have enough extra income to save toward retirement, let us work our magic to save you hundreds or even thousands of dollars that you can then put toward saving to become a millionaire.