30-Year-Olds Need To Invest This Much Money Each Month To Become A Millionaire

30-Year-Olds Need To Invest This Much Money Each Month To Become A Millionaire


February 27, 2023 | Eul Basa

30-Year-Olds Need To Invest This Much Money Each Month To Become A Millionaire


Becoming a millionaire may seem like an impossible feat, but it's actually quite achievable, even if you only start saving at the ripe age of 30.

According to Merrill, retirees would need between $1,000,000 and $1,500,000 to live off of $50,000 a year, which is considered the sweet spot for many. Naturally, the earlier you start saving, the easier it will be to hit that magic number by the time you turn 65. But exactly how much will you need to put aside each month to get there if you start at 30 years old?

Brian Stivers, a financial advisor, crunched the numbers for CNBC Select and determined three pathways to a million dollars for 30-year-olds:

With investments that yield a 3% annual return (i.e., bonds), you would need to invest $1,400 a month for 35 years to reach $1,000,000.

With investments that yield a 6% annual return (i.e., bonds and stocks), you would need to invest $740 a month for 35 years to reach $1,000,000.

With investments that yield a 9% annual return (i.e., a stock-heavy portfolio), you would need to invest only $370 a month for 35 years to reach $1,000,000.

Obviously, 30-year-olds will have to save a little more than 25-year-olds to reach the same goals, especially since compound interest is most effective when it has a longer period of time to grow your money. That said, it's never too late to get started — even if you've lost a couple of years, you can always put aside more money than Stivers' estimates, and that will help to get you on track.

It's important to note that Stivers' estimates are contingent on consistent returns from investments. Putting aside money is not enough — you need an additional boost from investments to get the most out of your savings, which means looking into bonds and stocks.

That said, whenever investments are involved, there is always a risk of falling short. A safe practice would be to invest in index funds like the S&P 500, which track the stock market as a whole. This will save you the trouble of having to pick the "right" individual stocks and making more complex decisions about when to buy or sell. While past performance doesn't always indicate future success, relying on these indices would still be a less risky bet.

You could also opt for a roboadvisor to help you with your investment goals. These algorithm-based services help determine your risk tolerance, as well as balance your portfolio automatically so that you don't have to worry about making the allocation adjustments yourself.


READ MORE

Zero-Based Budgeting: A Different Way Of Looking At Your Finances

Whether you're struggling to budget or are needing to start budgeting and are looking for a new approach, zero-based budgeting could be a different approach that will have you looking more honestly at your finances.
March 12, 2025 Jack Hawkins

You've Just Inherited Over A Million Dollars, What Now?

Any inheritance, although coming with a (sometimes) painful loss, is a great opportunity to invest your money into yourself in some way. Whether that's a vacation, a new home, or in your future. What if you inherited over a million dollars? Here are our suggestions for the unexpected multi-millionaire.
May 2, 2025 Jack Hawkins

You're Probably Spending Too Much On Grocery Bills. You Can Save Money With Some Simple Tricks.

Groceries aren't getting any cheaper. But the way you shop could be quietly costing you more than it should. Ready to keep your cart full and your budget intact?
May 7, 2025 Peter Kinney

These Items In Your Grandma’s House Could Be Worth A Fortune

Whether you're clearing your grandma's house after she's passed on or simply decluttering, there are so many vintage items worth big bucks that most people just throw away. Do some research before discarding anything that may have some value. You could be throwing out thousands of dollars worth of vintage valuables.
March 10, 2025 Jack Hawkins

Your 2025 Retirement Checklist

If you've finally hit 65 or 70 and think this will be the year you'll retire, congratulations! But before you take that monumental step of giving up work for good, here's your must-do retirement checklist.
January 10, 2025 Jack Hawkins

If You'd Bought These Stocks, You'd Be Rich Now

Nothing in the stock market is guaranteed. It's a gamble—and even the people that know the most and understand it the best often lose lots of money. But there is also the opportunity to make lots of money if you make the right choices/guesses/get lucky. Like if you'd bought any of the following stocks...
December 11, 2024 Jesse Singer


Disclaimer

The information on MoneyMade.com is intended to support financial literacy and should not be considered tax or legal advice. It is not meant to serve as a forecast, research report, or investment recommendation, nor should it be taken as an offer or solicitation to buy or sell any securities or adopt any particular investment strategy. All financial, tax, and legal decisions should be made with the help of a qualified professional. We do not guarantee the accuracy, timeliness, or outcomes associated with the use of this content.





Dear reader,


It’s true what they say: money makes the world go round. In order to succeed in this life, you need to have a good grasp of key financial concepts. That’s where Moneymade comes in. Our mission is to provide you with the best financial advice and information to help you navigate this ever-changing world. Sometimes, generating wealth just requires common sense. Don’t max out your credit card if you can’t afford the interest payments. Don’t overspend on Christmas shopping. When ordering gifts on Amazon, make sure you factor in taxes and shipping costs. If you need a new car, consider a model that’s easy to repair instead of an expensive BMW or Mercedes. Sometimes you dream vacation to Hawaii or the Bahamas just isn’t in the budget, but there may be more affordable all-inclusive hotels if you know where to look.


Looking for a new home? Make sure you get a mortgage rate that works for you. That means understanding the difference between fixed and variable interest rates. Whether you’re looking to learn how to make money, save money, or invest your money, our well-researched and insightful content will set you on the path to financial success. Passionate about mortgage rates, real estate, investing, saving, or anything money-related? Looking to learn how to generate wealth? Improve your life today with Moneymade. If you have any feedback for the MoneyMade team, please reach out to [email protected]. Thanks for your help!


Warmest regards,

The Moneymade team