Everyone wants to be a millionaire. So, what’s their secret to acquiring wealth?
GOBankingRates reached out to financial experts to ask what the most common strategy for making money was for millionaires. Find out the millionaire secret and see if you can start implementing it to grow your net worth.
If you’re wondering if investments like real estate or even new channels like NFTs were the golden path to becoming a millionaire, you’re partially right. The one thing all experts agreed made a millionaire was investing. Though the places to invest varied, if you’re not putting money into something and letting it compound, it’s going to be a whole lot harder to make millions.
Matthew R. Clark, J.D. is the owner and lead attorney at the Clark Law Office. Based on his clients, he knows wealthy people never just leave their money in the bank.
“They rather spend on items that will gain value, such as real estate, a combination of stocks or other business ventures,” he said.
It’s not that non-millionaires don’t invest. The caveat, experts say, is that most people tend to overspend on goods, so it cuts down on the impact of their investments or makes them go into debt.
“Millionaires who have earned their money do not view the money as something to spend,” said L. Burke Files, the president of Financial Examinations & Evaluations, Inc. “Rather, money is seen as a tool to be used for their benefit. They are also very conscious of avoiding debt.”
Even a small investment made today can help you in the future. Geoff Knight is the founder and CEO of File Tax Online. He said one of the easiest ways you can start investing is by taking advantage of a 401(k) account.
“Millionaires fill up their retirement accounts first before they buy fancy things,” he said. “They use 401(k)s and IRAs. These accounts help them pay less tax. When they invest, they choose options that are taxed less over time.”
If you want to be really proactive about growing your wealth, Knight said it might be time to bring in a professional to help you achieve your goals.
“Millionaires see tax planning as a way to build wealth. They plan their taxes all year long and work with tax experts to make smart choices about how to invest money,” he said.
