How To Become a Millionaire With Less Than $150 per Week, According to Money Coach Chloé Daniels
Written by
Jordan Rosenfeld
Edited by
Molly Sullivan
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If you’ve labored under the notion that the only way to become a millionaire is to work incredibly hard, money coach Chloé Daniels would like to break you of this idea.
In a recent Instagram post, she suggested you can become a “lazy millionaire” by investing less than $150 per week. If it sounds like a get-rich quick scheme, you can rest assured it’s not.
Her approach just requires having enough of a timeline, consistency and taking advantage of how the market already works. Here’s how to do it.
Open a Roth IRA
One of the secrets to the low-effort millionaire life is opening a Roth IRA retirement account. If retirement is nowhere on your horizon yet because it’s a long way off, that is actually the best time to open one, because the longer you invest in it, the better. A 30-year timeline is ideal.
As Daniels put it, “We invest in the stock market and let time do the work for us.”
A Roth IRA is a tax-advantaged account that allows you to grow any after-tax money you put in tax-free — that’s right, all those earnings you make do not get taxed!
You can put up to $7,000 per year into a Roth if you’re younger than 50, or $8,000 per year if your 50 and older. Putting just $135 per week in will be enough to create a minimum of $1 million in 30 years through the power of compound interest.
Invest In Index Funds
Next, with that Roth, she suggested investing in an S&P 500 index fund or a total stock market index fund. Given the average annual rates of return of these types of funds, it’s totally feasible for $1,000 to grow to $10,000 in 10 years. In which case, Daniels pointed out, “You just made $9k totally tax free!”
Make Sure To Do These Things, Too
Additionally, you can increase your contributions to your 401(k) and “call it a day,” so long as the money in that account is being invested in the stock market, she said.
Be sure to set up an automated transfer from your bank account so that you are contributing every month.
Budget for this contribution so that you treat it like a bill and never miss it, she insisted. Consistency is key.
Start Small If You Have To
If you can’t put $135 per week away just yet, “every amount helps,” she insisted, and starting somewhere builds the habit and the growth.
As you enter your higher earning years, you can increase the amount of money you put away and watch your retirement savings soar.
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