The Millionaire Journey: Do You Think You Can?

Steam engine locomotive train. Detailed vector Illustration

I am in the process of launching my new book, The Millionaire Journey, in the next couple of months.  As the subtitle indicates, it is “A Guide For Anyone to Reach Financial Freedom.”  Interwoven between the real world instructions in each chapter, is an allegory of a train journey from Normal to the Land of Financial Freedom, just beyond Millionaire Mountain.  The inspiration for the allegory came from a story most will know:

The Little Engine that Could

You remember the Children’s book by Watty Piper.  But do you know THE STORY BEHIND THE STORY?

 Watty Piper was not the originator of this tale.  It was actually published first in the New York Tribune on April 8, 1906.  It is attributed to a sermon delivered by the Rev. Charles S. Wing.  Here is that version in its entirety:

In a certain railroad yard there stood an extremely heavy train that had to be drawn up an unusually heavy grade before it could reach its destination. The superintendent of the yard was not sure what it was best for him to do, so he went up to a large, strong engine and asked :

“Can you pull that train over the hill?”

“It is a very heavy train,” responded the engine.

He then went to another great engine and asked:

“Can you pull that train over the hill?”

“It is a very heavy grade,” it replied.

The superintendent was much puzzled, but he turned to still another engine that was spick and span new, and he asked it:

“Can you pull that train over the hill?”

“I think I can,” responded the engine.

So the order was circulated, and the engine was started back so that it might be coupled with the train, and as it went along the rails it kept repeating to itself: “I think I can. I think I can. I think I can.”

The coupling was made and the engine began its journey, and all along the level, as it rolled toward the ascent, it kept repeating to itself: “I —think —I can. I —think —I— can. I —think— I —can.”

Then it reached the grade, but its voice could still be heard: “I think I can. I—– think—–I—–can. I —–think—– I—– can.”

Higher and higher it climbed, and its voice grew fainter and its words came slower:

“I ——-think ——–I——-can.”

It was almost to the top.

“I ———think”

It was at the top.

“I ———can.”

It passed over the top of the hill and began crawling down the opposite slope.

‘I ——think——- I—— can——I—– thought——I——-could I—– thought—– could. I thought I could. I thought I could. I thought I could.”

And singing its triumph, it rushed on down toward the valley.

THE REST OF THE STORY:

What is so intriguing about this version is not the variation of the story, but the context.  You see, this sermon was given by Rev. Wing to his congregation after they had climbed their own mountain.  This Sermon was given in celebration af the Nordstrand Avenue Methodist Episcopal Church’s triumph.  They had finally paid off the mortgage on the church’s property.  They were debt free!

They thought they could, and they did! They reached Financial Freedom!

If you think you can, you will too!

Five Uses of Money

The Wall Street Journal recently reported that US household indebtedness has reached a new high.  After years of retrenchment following the 2008 housing collapse it appears that Americans have resumed their love affair with debt.  This new peak in indebtedness is being driven by student loans, car loans, and even the evil credit card.  Credit card debt topped $1 Trillion for the first time since 2008 and will likely reach a new all-time high this year.

What is so bad about debt, you might ask?

The reality is there are only five uses of money, and what you use in one area, cannot be used for other areas that should be a higher priority.  In this way, debt steals people’s financial future.

LIVE:  This is the money you spend on lifestyle

What house will you live in, what car will you drive, where will you live, what will you wear, what will you eat, what will you do for entertainment, where will you go on vacations?  These are some of the things that fall in this category.  For most of us, this is where we would like to see a large portion of our money go so we can have “a good life.”  What credit enables us to do is to get these things on other people’s money, but it comes at a price.

GIVE:  Charities, family, friends often need our help

Can you provide for your children’s college.  Would you like to support kids overseas, or your church?  Do your parents need help from a private duty nurse or paying for assisted living?  These are just some of the areas we might like to help with, but sadly we often cannot find the means to do so.

GUARD:  Health, Life, Auto Insurance, Emergency Fund

Most people who understand financial risk have a large portion of their income going to this area.  The cost of a major health issue or a major car wreck, especially involving others, can bankrupt a middle class household.  Many who do not allocate funds to this area have experienced financial ruin.

GROW:  Investments in self development, entrepreneurial and/or career endeavors and retirement.

This is the area where we expect money to produce a return in the future.  Investing in a college education, trade school, or certifications should produce higher levels of income.  Money spent to get your own business off the ground should help you attain financial independence.  Allocating a percentage of your income to retirement funds can provide for your future in your golden years.  Unfortunately, most Americans do very little for retirement and use debt to fund their educations and business start-ups which result in the anchor of indebtedness weighing down their progress.

OWE: Taxes, Debt Service

There is little we can do about taxes unless you do not produce an average income or better.  Even then you will have gas taxes, sales taxes, and property taxes eating away at your cash flow.  Indebtedness, however is within our control.  we make the choice on whether or not to go into debt.

BALANCE IS THE KEY

I have found it useful to take a look at your monthly spend and see how much of your hard earned money is going to each of these areas.  No one can tell you what percentages should go where, that is totally up to you.  Just remember, what you spend in one, you could spend on another.  Are you happy with what the balance looks like in your uses of money?  If not, you CAN change the equation.

TAKE THE WHEEL

You can eliminate debt to provide more cash flow to retirement funds.  You can buy used cars for cash instead of new cars on leases and free up hundreds of dollars a month to go in your child’s education fund.  You can choose to live in a smaller house to be able to travel more.  You are in control.  Be intentional about the life and future you want to create and start making moves to live your dream.

 

Grandma’s Advice for All of Us- Mothers Day 2017

I once listened to an EntreLeadership podcast  interview with Ken Blanchard, author of The One Minute Manager, and about 50 other books.  I have always admired Ken’s ability to offer wisdom in a simple, succinct manner.  He told a story that I would like to retell for you (with some embellishment).

There once was a boy who loved his grandmother, but lived far away from her.  They had a very special relationship.  When he would visit, they spent most of their time making and eating home-made cookies, doing crossword puzzles together, watching game shows on the TV, and playing board games.

Grandma’s favorite board game was monopoly.  She taught the boy how to play when he was about seven.  The grandmother was a very sweet and loving woman, but when she played monopoly she turned into Donald Trump!  She was ruthless and she never lost!   One summer, when the boy was 10, Grandma told him if he ever beat her at a game of monopoly, she would give him a great treasure she had acquired from her father.  The boy asked what it was, but she would not tell him.

So he went home with his imagination running wild.  He asked his dad about it.  After all, Grandma was his mom.  His father said he remembered getting the same offer, but he never beat her, so he never got the treasure.  What secret treasure could Grandma be holding on to for generations?  There was only one way to find out!

The boy started playing monopoly at every opportunity.  He played with his parents, friends, and classmates after school.  He downloaded the monopoly app on his phone.  He was so obsessed his parents had to threaten to take away his phone if he did not do his homework and chores first.  Over the next few months he played hundreds of monopoly games, exploring new strategies, reading blogs on the game, and he started winning.  In fact, by Halloween, he rarely lost!

That year Thanksgiving was held at the boy’s house, and Grandma came.  She arrived Wednesday evening and had barely got settled into her room when the boy, monopoly game in hand, appeared and asked her to play.  With a wry smile the Grandma asked, “Are you sure?  I would not want to ruin your Thanksgiving!”  “I’m sure,” the boy answered with a quiet confidence that impressed the grandmother.  “O.K. then.  Let’s get started!” Grandma’s answered.

They set up the game in the dining room.  It was about 7:00.  As the game went on, family members started stopping by the game to watch, and none of them left.  By 10:00, the room held 12 spectators.  Team Grandma, and Team Grandson cheered and jeered as their player went to jail, landed on free parking, acquired a monopoly, mortgaged properties on the brink of ruin, then bounced back!  By midnight, the whole household was spent, and so was Grandma.  All her properties were mortgaged, and as she rolled the dice she saw her next stop was Boardwalk; owned by her grandson, and on it, a bright red hotel!

She conceded the game and congratulated the boy!  She told him it was the first time she had lost a monopoly game since she was ten years old, when she beat her father for the first time.  All the spectators offered their congratulations and condolences and headed for their beds, leaving the two players alone with the game.

The boy perused the board, surveying all his property and his enormous pile of cash.  He could not stop smiling.  The Grandma smiled herself.  She took his hands in hers, looked him straight in the eyes, and said, “Are you ready for the treasure I promised you?”  “You mean you are going to give it to me right now?” he asked.  “Absolutely!” she said.  ‘I always keep my promises.  Help me put the game away.”

So they put away the game in about 2 minutes.  The houses, hotels, property cards and cash all went back in their rightful places.  “There you have it!” Grandma announced.  “What?” the boy replied.  “Why, your treasure of course,” she answered.  The boy looked at her, uncomprehending.

Again, the Grandma took his hands in hers, looked him in the eye and said, “The treasure I promised you is this bit of wisdom from my father.  At the end of the game, and at the end of your life, it all goes back in the box.  All the things you have acquired will be put back into play for the next players.  All that really matters is who you have loved, and who loves you.”

At first, the boy was disappointed that there was not some secret treasure box filled with gold, but he looked at his grandma, saw the love and tears in her eyes, and gave her a huge hug.  “Thank you so much for loving me!” he said, then he turned to the table and put the lid on the game.

3 Essentials for a Great Life (Hope, Hard Work, Habits)

It is Thanksgiving morning.  I think that most of us in the United States can acknowledge that we have a great life.  The reality of our situation compared to the rest of the planet has been the result of three essential elements that form the backbone of our nation’s prosperity.  In order for the next generation to prosper further, I think we need to reinforce these elements at this critical juncture in history.  Are we going to slide into the doldrums of socialism, or are we going to reawaken the hallmarks of our Free Market, Capitalist society?:

Hope

Hope says that no matter what trials and tribulations we face things can, and will, get better.  It is born out of a faith in an all-powerful creator that loves us like the perfect father and is “working all things together for our good.”  It is much easier to have hope if one believes in a benevolent deity than if all you are counting on is the selfish nature of man!

Hard Work

Work Ethic has always played a crucial role in the success of our society.  Combined with our innovation, it has propelled the United States to lead the world in productivity.  One driving factor is that entrepreneurial small companies still employ more than half of the workforce in the US.  The little guy can, and still does, get ahead.  This potential has been fueled even more by the advent of the internet and the ability to be productive from almost anywhere at any time.

Yet we have an epidemic of malaise that seems to have hit our workforce, and a political machine that wants to create a society dependent upon governmental intervention and entitlements.  Gone is the stigma associated with accepting welfare and unemployment. Instead we have a liberal elite who want to be seen as Robin Hood, stealing from the “evil” rich and distributing to the “less fortunate.”  In reality they are stealing from hard-working people who have been wise with what has been entrusted to them, often to support people who neither work hard, nor make wise choices with their lives.

There certainly are people with needs to be addressed, but government has proven to be the least efficient vehicle for that aid, and it creates generational dependence.  Rather than giving a leg up, they tread on the hopes and dreams that can lift people out of their current state.

Habits

This is where the rubber hits the road.  Is our society rewarding habits like responsible financial management, saving and giving, or is it rewarding irresponsible childish habits like living off the work of others, spending more than they have, and then expecting others taxes to pay their debt because it is not “fair.”  Are we rewarding the young adults who devise a plan to get the education they need to develop a career track, working their way through college doing internships that show they have learned things that have value in the marketplace, or do we reward the ones who spend 5 years at college on low-income grants playing beer pong and throwing keggers, and then come out and lament that the piece of paper they have been handed is not Willie Wonka’s golden ticket to wealth and riches?

I am so thankful for the freedom and opportunity our country affords.  I pray today that we do not allow hopelessness to rob us of the values that make us great.  I have children, and hopefully one day grandchildren, that need to be free to succeed and achieve an even greater life than the one I have been blessed to lead.

Winners Plan, Planners Win!

Do you want to win?  You better learn how to plan!  Almost nobody wanders into success.  Success in any arena takes intentionality. A successful life requires intentionality across all dimensions of life.  Zig Ziglar summed these up as the seven spokes in the “Wheel of Life:”

  • Career
  • Social
  • Financial
  • Family
  • Physical
  • Mental
  • Spiritual

In order to have the type of life we all dream of having we need to plan first to have time to devote to all seven dimensions, and then have a plan in each of these arenas, both short-term, and long-term, if you really expect to achieve results in each area.

Finally, you must realize that a plan is only a plan, subject to change.  A friend of mine who has retired from a distinguished military career including combat command says the army has a saying about this reality:

Fight the Enemy, Not the Plan!

We have to realize that no matter how in-depth and detailed our planning is, that when we go to execute on the plan, things change.  The enemy defies our expectations, unforeseen external forces come into play, we forgot to contemplate a variable altogether…  What do we do at that point?  If you want to win, you cannot run, you cannot wave the white flag…  We have to adjust the plan and press forward to our objective, even if that means a temporary retreat to re-engage under better circumstances.  Just because you made a plan, don’t be married to it!  You did not take a vow to serve the plan “til death do you part.”

With the liberating thought that plans are made to be changed, let me throw out a few challenges for planning across the dimensions of the wheel of life:

  • Career-  How are you doing on executing this year’s plan in your current career role?  Do you know your next step for promotion at your current employer, or advancement by moving on to another?  If you are an entrepreneur, what will take your company to the next level?
  • Social- Who are you planning on having over for dinner in the next month?  What are you doing to create or tie into a network of friends that you can enjoy life with when your kids have flown the coop?
  • Financial- How are you doing at living within your budget this month?  Does every dollar have a name?  Are you telling your money where to go before the month begins, or wondering where it went when the month is through?  What is your number to reach financial independence so you can literally do whatever you want to do for the rest of your life?  How long until you get to that number?
  • Family- Do you have time set aside on your calendar each day to connect with your spouse?  Do you have a weekly date night?  How about a night for a family devotion with the kids?
  • Physical- How many calories can you consume and maintain your weight, or how many do you need to cut to get to where you want to be.  What will you eat today to reach that amount?  How much will you need to exercise if you eat that Krispy Kreme?  Is there time on your calendar set aside for exercise?  Could you maybe combine that with time with your spouse, or time to pursue intellectual pursuits with audible books or podcasts?
  • Mental- What are you doing to expand your knowledge in your specific career track.  Who are you reading or listening to in order to become a better leader, better spouse, better father, better person?  Can you make use of that awful highway commute by tapping into the information superhighway?  Can you listen to podcasts on your commute, your run, or on the elliptical?
  • Spiritual- Do you have time on your calendar each day to pray and meditate?  Could you turn your car into your prayer closet?  Is there a group of like-minded people at your work place who might like to study scripture or a book exploring scripture, together.  What are you doing today to answer the most important question in life?  When you stand before the maker of the universe and he asks, “Why should I let you into my heaven?”

The biggest part of successful planning is committing to do it.  If you want success in an area of life that you are not winning in today, MAKE A PLAN!

What Are Your Kids Learning From You?

I am living a blessed life.  A result, in part, of learning from my Father.

My Dad taught me a lot of important lessons by example.  He was a hard worker.  He was sent off to military school as a tween, then did a tour in the Marines, followed by cooking and managing in restaurants from the Ozark mountains to Washington D.C.  He often took second jobs in construction to make ends meet, and to pay finance payments on campers and boats, as well as fishing and hunting gear with which he had many bonding opportunities with his only son, me!  We probably went fishing, hunting, and or camping at least 15-20 times a year from age 4-13.

I played 3 years of baseball, 3 years of football, and 2 years of basketball before I was 13 and I can only remember my Dad missing 2 games, though he worked 50-60 hours a week.  In addition we shared a passion for Ohio State and Redskins football.  I remember many Saturdays and Sundays spent in our Volkswagen camper behind whatever restaurant he managed with a little 9 inch TV plugged in to an orange extension cord running out the back door of the restaurant, or listening to the game on a big battery-powered radio at a construction site while I “helped” Dad as he hung dry wall.  My Dad definitely taught me to value time with my kids and to find a way to make it work even when working hard.  He taught me to tell my kids I love them often and back it up with a commitment of time and energy.

Other lessons I learned from my Dad were not from things he did well, but from the things he did poorly.  At the age of 6 my Mom left my Dad and me and moved back home to her family.  My Dad never admitted a moral failure suspected by my Mom, nor did he admit to one when he got divorced from his 3rd wife when I was 15, nor did he see anything wrong with marrying his 4th wife, an 18 year-old, when he was 47.  He had no relationship with his two daughters from his first marriage before he married my mom.  Nor did he stay in touch with his three children from his fourth marriage that imploded.

My Dad put energy and effort into relationships as long as they were good for him.  When they were not, he just walked away and started over, but never learned from the mistakes of his past.  This fact marked me, and I have fought to never let that happen to relationships with the ones I love.

At age 11, after uninsured hospitalizations and surgeries for me (benign tumor) and Dad (double hernia) the mountain of debt he had accumulated fell in on him.  We lost our home and everything else we owned (or should I say owed) in bankruptcy.  I promised myself I would not allow that to happen to me, and have been debt averse and savings minded since.

Part of what contributed to the need to file bankruptcy was my Dad’s continuing devolving career.  When I was four, my Dad was on a very successful  management track with Marriott restaurants.  He left because of a falling out with his boss.  The same reason was given when he left employment of three other independently owned restaurants, and a stint at Ft Belvoir’s Army base cafeteria as well.  I remember at least 6 different restaurants he worked at between age 4 and 13.  My Dad was prideful and could not submit to authority.  I swore I would not make that same mistake and have probably been overly loyal to my employer’s in my career, but it has paid off with continued upward mobility.

I often wonder how some people, like me, learn from other’s failures, while others seem to be destined to repeat the same mistakes, generation after generation?  How can I make sure my sons learn from the good and bad they have seen in me to have a better life?  How can we, as leaders, help our teammates overcome their past so they can be productive, engaged and committed?  Finally, if you are a parent, what are your kids learning from you?  Is it what you intended them to learn from you?

Type A Leaders: When Should You Cut Yourself Some Slack?

OK.  I confess.  I am a hard-driving, disciplined, goal oriented “Type A” personality.  I set goals with timeframes and I knock them down consistently.  This approach has worked well for me in my career, personal development, personal finances, etc. I advocate these attributes for others who want to be successful.  It is the difference between being a dreamer or a doer, a planner versus an achiever, a what-iffer and a go-getter.

Having said that, a successful life is a balanced life.  I am going through a job change and I am finding that I am not knocking down some of my daily and weekly goals as consistently as I would like.  If you are a Type A, you probably know what I have been doing to myself during this period… That’s right, beating myself up!  Well today that is stopping!  I have come to the conclusion that there are times that it is ABSOLUTELY RIGHT to cut yourself some slack.  Here are a few:

When you have to re-prioritize

A plan is important, but it has to be subject to change.  New events and challenges will require even the most disciplined and fore-sighted to adjust and course correct from time to time.  As long as those corrections are taking you around the obstacles and closer to your overall goals they are good things!  Don’t get discouraged!

When it’s beyond your control

In the movie Dangerous Liaisons, John Malkovich’s character, one of the most despicable personas ever created on film, repeated a line over and over when he was called upon to show even an ounce of decency or morality… “It is beyond my control.”

In the context of that movie, it was a false statement, but in many of the situations we face in life, we simply cannot execute on every plan because of things that really are “beyond our control.”  Sickness, natural disasters, economic meltdowns, are just a few of the things that fall into this category.  If you have been hit by this type of life events, give yourself some grace while you figure out a new plan.  Many have heeded hidden messages in these trials to set new courses for even greater personal and/or professional success.  Look for the lesson that might be hidden in the pain.

When it is adversely affecting your family

In my opinion, nothing is more important than doing the right thing for my family.  Sometimes my family has made decisions to sacrifice in the short-term in order to win in the long-term and we have benefitted greatly.  If, however, I am consistently sacrificing family time, energy and connectedness to further career goals… That is not true success and something else has to give.

When the only person who cares is you!

Type A’s.  Have you ever struggled with a decision to back off a goal because you do not want to disappoint a colleague, a superior, a family member, etc, only to find when you made the decision, that you were the only one that noticed?  Being disciplined in self-imposed goals and deadlines is important, but when you have to let one go for the sake of demands from others occasionally, don’t beat yourself up about it!  In fact you might want to pick up a mantra of another movie character; Bill Murray’s camp counselor from the movie Meatballs; … “It just doesn’t matter, It just doesn’t matter, it just doesn’t matter!”  Sometimes it doesn’t!

There you have my list of when it is OK to cut yourself some slack.

What’s on your list?

Round Tuit Rant. Reader Discretion Advised!

round_tuit_magnetFinally!  You have what you need to accomplish everything you hoped in life.  It is pictured right here and can be ordered at cafepress.com.  For less than my son’s weekly allowance, you may hold in your hand the ever evasive, altogether allusive, Round Tuit.

For any of you who have not already heard this age old joke, by holding this item, you will have the power to do everything you have said you will do when you get “around to it.”  Some examples:  When are you going to go for that promotion, write a book, spend more time with the kids, go on that diet, start exercising…  That is right, when you “Get a Round Tuit!”  Well, now you can have one.

All kidding aside, we have a society filled with procrastinators.  “Why do today what we can put off until tomorrow?

Rather than Plan, we Pass.

Rather than Persist, we Pause.

Rather than Produce, we Play.

Why?  Because we believe we are Entitled.  Someone is supposed to make us happy!  THEY owe it to us.  Whoever THEY are!  We have paid our dues… or our parents did… or grandparents, or someone we cannot quite identify.

That does not matter, I am an American.  I have the right to Life, Liberty, and Happiness.  It’s in the Declaration of Independence!

What’s that?  What do you mean it does not say happiness, but the “pursuit of happiness.”  What does that mean?  Wait, pursue… That implies I have to do something!  Not only that, I might not even succeed in the pursuit?  Well forget that!  Just redistribute the wealth and we will all be fine.  There is plenty to go around. Right?

The fallacy of this fantasy world has popped in two financial bubbles in the first decade of the new millenium.  First we had the dot.com bubble where everybody bought tech stocks and fantasized that new technology would save us from having to work for a living.  It popped.

Next we tried to continued to try to live beyond our means buy taking out second mortgages, enabled as bankers started lending money to every warm body who could make their mark on a zero down mortgage contract.  The demand of all those new home buyers inflated housing prices and created false “equity” for us to borrow against.  Of course, we did, convincing ourselves it was “good” debt.  We could even get the tax deduction.  Of course, the house of cards came tumbling down, and our grandchildren will be paying the price for decades to come.

So, have we learned our lesson?  If not, here is a sure fire get rich scheme.

Work hard, spend less than you make, invest wisely for the long-term, only in vehicles you control and you understand, and be generous.  Good things come to generous people.

The time is NOW to get around to doing the things that will get you where you need to go.  Concentrate on these three things:

Plan:        Dare to Dream

Persist:    Do your Duty

Produce:  Don’t stop Doing

I have never seen someone follow these principles and not succeed in the long-run.

Special thanks to Pastor Kevin Myers, 12 Stone Church, for inspiring this rant!

 

Do You Want to be a Millionaire? You Do NOT Need Regis!

If you are a citizen in the United States of America, and you live to be 60, YOU SHOULD BE A MILLIONAIRE.  There is absolutely NO EXCUSE, not to be!  So why are so many people retiring and dying broke?  Because we do not understand the very simple concepts of living within your means and investing for the future.

I have been blessed in my life.  I grew up in very humble settings.  I was a child of divorce and watched my father live on Social Security disability at age 47 and die destitute in a Medicaid nursing home at the age of 59.  My mother remarried to a good man and lived a productive life, retiring with enough of a modest nest egg to provide for her, her church and extended family. The thought that I could ever be wealthy never crossed my mind as I was growing up.  In fact, I was more or less raised with the impression that being wealthy was sinful.

I did, however, acquire some life changing knowledge in my early adulthood.  One of my many ventures into multi-level marketing (there were sooo many!) companies was with an insurance company that converted whole life insurance policies into term life and annuities.  This was the early 80’s and I still remember the annuities were earning 11%!  Would I love to have that option now?!

What I learned on that job was the power of compounding interest.  A few years later, in my MBA program, I learned about investing in stocks, bonds, and real estate.  I started putting two and two together and determined that investing would be a priority for me.  I was 30 at the time, now I am 50.  Without giving details, it is amazing to find myself in my current financial position.  What is really remarkable is how much wealthier I would be if I had started when I was twenty!

“Still,” you might say to me.  “I am happy for you, but you have an MBA and make a six figure salary.  Most people do not find themselves in that situation.”  I could argue the point that almost anyone should be able to do what I did to get to that six figure income, but that is a blog for another day.  I am going to avoid all the arguments by showing how almost anyone in the US should be able to retire a millionaire.

Take, for our illustration, John Doe.  John is twenty years old, and frankly, he is a bit of a loser.  He has no ambition and is working for minimum wage.

Now, let us fast forward 40 years, John is still not very ambitious at age 60.  He is still working for minimum wage.  He has his entire life.  Oh, and the minimum wage has not gone up in that 40 years either.  He is only making $15,080.00 per year.  John is however, a millionaire!  He did not win the lottery, he did not get money from a rich uncle or cousin that passed.

How did he do it?  He took 15% of his money and invested it in a Roth IRA in good growth stock mutual funds.  He averaged 10% return over the 40 years.  That is a little less than what the stock market averaged in the last 150 years, but he still has $1,001,144 in his Roth.  I know a million bucks won’t go as far in 2053, but I think John will be just fine in retirement.

The 15% figure is interesting because it equals how much you and your employer are paying into Social Security.  At the risk of getting political, take a look at the return you are getting for that investment!  Would I rather retire with John Doe’s Roth IRA or Social Security Benefit Payments…  hmmm.  Not to mention, John will have to wait at least seven to ten more years to get full benefits from Social Security in 2053.  Oh yeah, and if John dies, his heirs get the million bucks instead of Uncle Sam.  That sums up the program we want to “save” to “help poor people!”

Merits or skullduggery of Social Security aside, we can still save like John.  Hopefully we will not be in a minimum wage job our entire life.  As we get raises, keep that 15% going into a retirement accounts and presuming we live long enough, we will be millionaires.

What about those of us who are in debt, middle-aged, and have nothing saved?  I will be honest, time is the main ingredient to this equation, and it will not be as easy as John Doe, but you can still get there!

A forty-year old making the average household income in the US, about $48,000, investing 15% ($7,200) with a 10% return, and getting 3% raises per year would have just over $1 million at age 66.  So if you make less than average income, or you are older than forty, you will need to make more and/or save more and/or save longer to get there, but almost everyone can get there!  They just need to develop and execute a plan.

If you need the best step by step plan on the planet to make yourself a millionaire get, The Total Money Makeover, by Dave Ramsey.  His “Baby Steps” will allow you to customize a plan for you, no matter your current situation, and teach you to “Live like no one else so that later you can live and give like no one else!”

Do you believe YOU can be a Millionaire now?

If not, I would love to hear the “why I am all wet” perspective!