Retire Early
Lifestyle
Retirement; like your parents, but way cooler
In 1991 Billy and Akaisha Kaderli retired at the age
of 38. Now, into their 4th decade of this
financially independent lifestyle, they invite you
to take advantage of their wisdom and experience. |
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How to
Become a Millionaire
by 50 years of Age
Billy and Akaisha Kaderli
Becoming a millionaire by 50 years of age
seems like an ambitious goal these days. But is it really?
The secret is to start early.
Let's take a look at some charts.
Using 70 years of data you can see that
the S&P 500 Index with dividends reinvested has returned over 10% annually.
For this financial
exercise I will set you at a 10% annual return, the same as the S&P 500
Index or the ETF symbol SPY. The first chart is out
of your control at this point but not for your kids.
A $10,000 investment into the S&P 500
Index when your baby is born could be worth more than one million dollars by
the time they are fifty. This will create a solid foundation for their
financial future - and that is without adding another cent to their
investment. But
what if you wait until they are ten years old to start this plan and still
make it to one million dollars by the time they are fifty?
With a forty year investment opportunity
the initial investment now needs to be $25,000. This is two-and-a-half times more
than the amount needed if you began your deposit at birth.
How about a 20 year old? How much do they
need to create this scenario?
Remember the goal is to become a
millionaire by the time they are fifty years old. They need $60,000
deposited to accomplish this goal.
Continuing this
exercise let's look at a 30 year old. How much do they need to deposit?
With only 20 years left before turning 50
years old, they need to deposit $150,000 and let the market work for them.
A forty year old is
getting down to crunch time and is going to have to make an even bigger
investment.
A deposit of $400K is what it will take to
create this plan of becoming a millionaire by the time they are 50 years
old.
As you can see,
time is on
your side when it comes to investing. The
earlier you get started the
less investment you will need to make.
Remember, all of these investments were a
one time investment. No other contributions were made other than dividends
being re-invested.
Now that you know this, you have the
tools to change your financial life or the life of your child or
grandchildren.
Get started today!
About the Authors
Retire
Early Lifestyle appeals to a different
kind of person – the person who prizes their
independence, values their time, and who doesn’t
want to mindlessly follow the crowd.
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