7 Moves to Ensure You’re a Retirement Multi-Millionaire

For many people, achieving millionairehood before retiring will not be enough. Yes, a million dollars is a lot of money, but if you plan to withdraw, say, 4% of it in your first year of retirement (adjusting future withdrawals for inflation), it will generate $40,000. That, along with Social Security income, may be enough to support you in the style you want — but if it’s not, you may need to shoot for becoming a multimillionaire by retirement.

Do some reading up on the matter to determine how much you’ll need to retire with, and no matter how much your target sum is, these seven moves can help you get there.

Image source: Getty Images.

1. Start investing as soon as possible

First off, start saving and investing as soon as possible — because your dollars that are invested earliest have the longest time in which to grow for you. Check out the table below, which shows how much a single investment of $10,000 can grow, at an average annual rate of 10%. (The long-term average annual return of the stock market is close to 10%.)

Over this period…

$10,000 will grow to:

5 years


10 years


15 years


20 years


25 years


30 years


35 years


40 years


45 years


50 years

$1.1 million

55 years

$1.9 million

60 years

$3.0 million

Data source: Calculations by author.

2. Invest aggressively

Clearly, it can really pay off to start early. But even if you start at age 45 and your money has 20 years in which to grow, you can still do well. The table below demonstrates this using a more conservative average growth rate of 8%, since a 10% return is never guaranteed.

Growing at 8% for

$10,000 invested annually

$15,000 invested annually

$20,000 invested annually

5 years




10 years




15 years




20 years




25 years




30 years




Data source: Calculations by author.

The table also shows how much more you can amass by saving and investing larger sums regularly. If you can manage $10,000 per year, ask yourself whether you might be able to up that to $15,000. If you’re at or near $15,000, with some diligence and perhaps some creativity, you might be able to save and invest $20,000 regularly instead.

3. Invest effectively

The rate at which your investments grow will make a huge difference in your long-term results. That’s why you’re most likely to do well by sticking largely (or completely) with the stock market for long-term money.

The easiest way to invest in the stock market is via one or more low-cost index funds. An index fund is a mutual fund that invests in pretty much the same holdings of the index it tracks, in roughly the same proportion. So it aims for roughly the same returns. The case for index funds is strong, too — they outperform the vast majority of their actively managed counterparts — funds with highly paid financial professionals at the helm.

4. Take advantage of retirement accounts

As you save and invest for your future, make the most of tax-advantaged retirement accounts such as IRAs and 401(k)s that are available to you. Both of those kinds of accounts come in Roth versions, which are particularly worth exploring, especially if you have a long investing horizon. Why? Well, because Roth IRAs and Roth 401(k)s are designed to let you withdraw from them tax-free in retirement.

Image source: Getty Images.

5. Live below your means

Of course, much of this won’t be possible unless you can live below your means — for a long time. At its essence, that means spending less than you bring in, but there’s more to it than that, of course. For best results, build yourself a budget — the process of doing so will help you see exactly where your money is going, and can help you spot where you can cut back on spending. As part of the budgeting process, you’ll want to lay out how you want to spend your money, so be sure to make saving and investing a priority.

If you don’t have enough money coming in to cover all your necessary and desired expenses, look into how you might bring in a little more. It can make sense to take on a side gig, at least for a few years.

6. Keep reading and learning

For best results in all your financial doings, aim to keep reading and learning. Read up on personal finance topics such as insurance, banking, and mortgages, and you may be able to save many thousands of dollars — if not tens of thousands or more. And read up on investing, too, throughout your life, if you want to improve your results over time. (If you’re just sticking with index funds, you can learn far less about investing, and index funds are perfectly sound choices for most of us.)

7. Stick with your plan

Finally, you’ll need determination if you want to reach your financial goals. You’ll need to make plans, have strategies, and execute on them. It can be very easy to put off saving and investing, but as the tables up top make clear, the sooner you start, and the more diligent you are, the more you can amass. Keep your eyes on the prize, as it will be worth it.

These steps may help you reach multi-millionairehood — or maybe you’ll just get to a million dollars or $600,000. However much you can save by retirement will be vital to your future financial security.

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