Categories: Success

How To Become A Millionaire By The Age Of 25

The subtitle of my book, “MILLENNIAL MILLIONAIRE – A Guide to Become a Millionaire by 30“, generated a lot of buzz on how to make quick money. While this was a totally unintended consequence of a cute tagline, there’s nothing wrong with young ambition. For full disclosure, I personally am a Certified Financial Planner™ committed to long-term wealth accumulation, achieved by patience and adherence to a sound set of strategies. So, how do you become a millionaire by age 25 and not just by 30? Here’s my advice: Reader beware, this may serve as a cautionary tale.

Let’s first examine the facts and then see what’s feasible. Most college graduates today are finishing their bachelors degree at 22 years old, give or take a year. The average starting salary for the graduating class of 2018 is about $50,390 , per USA Today, and most entry-level jobs are much less than that. So, if we take the average income and subtract taxes — we’ll just use 20 percent effective tax rate for simplicity — that leaves $40,312 of take-home pay. Notwithstanding all the usual expenses for a young professional (i.e. student loan payments, car payments, cell phone bill, hitting the bar, etc.), even if the average grad was able to bank all of this money for the next three years leading up to his or her 25th birthday, that would total $120,939 of savings. That’s still a far cry from $1 million buckaroos.

Consequently, why even title this article “How to Become a Millionaire by 25”, or entertain the idea? We already know that the average income won’t get you there. One can’t realistically invest their $120k of accumulated savings into $1 million within three years, unless they’re literally gambling and coming up a winner almost every time.

Rather than buying lottery tickets every week and crossing your fingers, you’ve got to first realize that extremely high income and/or access to assets is a prerequisite for reaching the millionaires club. What are the highest-paying jobs in America today? Anesthesiologists top the list with a mean income of $269,600, followed by Surgeons, OBGYNs, Oral and Maxillofacial Surgeons and Orthodontists , per US News. As you can see, the medical space dominates this realm. Considering any of these occupations requires an additional four years of medical school beyond just undergrad, then an additional three-to-seven years of residency and fellowship training, these folks don’t rake in the dough until well after 30. The first job on the list that is not in the medical space is a Petroleum Engineer, which comes in at No. 12 on US News’ list, bringing in a mean income of $147,030.

That pretty much eliminates the traditional income track. However, there are millionaires under the age of 25, so don’t hang your head just yet. Without further ado, here’s how they were able to get to become a millionaire by age 25.

  • Start a business. Per above, the normal route won’t cut it. Even a high-paying job won’t ramp up fast enough by your mid-20s.
  • Start said business super early, not at age 21 after four years of frat parties. Most millionaires under the age of 25 started a business in college, or even in high school, so if you have an idea and a skill, go with it! • Discover the repeatable. It’s OK if your business makes only $1 per transaction, as long as one million people want to buy it.
  • Think tech. The bulk of today’s young mega rich are taking their idea on the web to an international audience and selling to large companies. For instance, Instagram sold to Facebook for $1 billion in 2012.
  • Network. A great idea is just that, an idea. It takes a network of professionals to make it a reality, so remember to always be building — and managing — your professional network.

As you can see, there’s no easy route to become a millionaire by age 25, and investment strategies are disconnected to such a lofty goal. Unfortunately, unless you’re an incredibly talented athlete signing one of the richest contracts in sports, or so good looking that Hollywood caught your profile picture, the odds are not in your favor. Consider the strategies above on your quest towards $1 million, and, if blowing out 25 candles comes and goes, don’t be deterred if your bank account isn’t there — you’re certainly not alone. Of course, there’s one last way to reach this objective though, go make your money the old fashion way — inherit it!

All images via Getty

Bryan M. Kuderna is a CERTIFIED FINANCIAL PLANNER™, Life Underwriter Training Council Fellow and Investment Adviser Representative with Kuderna Financial Team. He is a perennial qualifier for the industry’s prestigious Million Dollar Round Table®, Leaders Club and Inner Circle. He is the author of the best-selling book, “MILLENNIAL MILLIONAIRE- A Guide to Become a Millionaire by 30”.

The Editorial Staff

The Editorial staff are financial enthusiasts and analysts from across America. Their profession expertise extends to corporate consulting, accounting, and financial strategy.

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