Have you ever wondered how long it takes to become a millionaire? Well, it varies depending on factors like your education, income, effort, career, and luck. For me, it took just over six years post-college to hit that million-dollar mark. I managed this by landing a great job in finance and saving more than half of my after-tax income, along with a timely investment in San Francisco real estate on my 26th birthday.
It’s rather unseemly when billionaires suggest the rest of us should give more to charity. Imagine splitting a cab with Warren Buffet, and he asks you to foot the bill with your last $10 while he’s sitting on a pile of $100 bills. On another note, it’s intriguing how President Obama often refers to those earning $200,000 as “millionaires.” If you’re making that much annually, you’re not necessarily close to being a millionaire, which contradicts some implications in tax speech rhetoric.
So, how long does it really take to become a millionaire? Let’s say you’re in California, earning $200,000 a year, which after taxes, comes down to about $140,000. If you save a whopping 50% of that, thanks to your disciplined financial habits, you could become a millionaire in roughly 14 years. However, if you opt to save 20%, which is more common, expect it to take around 36 years. And if you’re only setting aside 5% of your income? Well, that extends to an impractical 143 years.
Warren Buffet has wisely suggested that instead of the current approach, we should consider raising taxes on those who actually make over $1 million a year. This makes more sense than the current thresholds. If we started doing this, anyone making that much would likely accumulate a net worth of a million or more very quickly if they saved wisely.
In a direct response to often confusing tax policies, let’s just say raising taxes on actual millionaires could help streamline our financial rhetoric and policies. After all, if the aim is to increase tax revenues and maintain fairness, focusing on actual millionaires would be a more effective and straightforward approach.
