How to Become a Billionaire in 10 Years – You may have already heard about the amazing story of Bill Gates, the founder of Microsoft who made it to the Billionaire’s list in just 6 years. You may have also heard about the story of the founders of Facebook who made it to billionaire status in just 6 years. Those are both amazing stories about how you can do anything you put your mind too. But what I want to talk about is how you can make it to billionaire status in 10 years or less.
Have you ever wondered how do I become a billionaire in 10 years? Or how long does it take to become a billionaire? This article provides you can be a billionaire in 10 years, How to Become a Billionaire, How to Become Wealthy, etc.
If you’re thinking 223 years, you’re way off. Using the future value function in excel and compounding the returns monthly, we reach the princely sum of $1,009,076,276.09 in just . . . 84 years. So max out your retirement accounts beginning at age 20, and when you turn 104 you will be a billionaire. Easy peasy lemon squeezy.
Now before you email me, I understand this example is not exactly practical. But it can teach us a lot. Let’s start with inflation.
A billion dollars in the year 2100 won’t buy what it can today. In the words of Yogi Berra, “a nickel ain’t worth a dime anymore.” If we assume an inflation rate of 3%, our billion dollar nest egg 84 years from now is worth “just” $84 million. Still a lot of money, but a far cry from $1 billion.
To be fair, we would also need to adjust how much we saved. Over the next 84 years, the contribution limits of 401k and IRA retirement accounts will go up. Assuming the same 3% increase, we’ll be maxing out our 401k accounts in 84 years to the tune of $215,000 a year. My future grandchildren will be looking forward to the company match!
The point is that inflation matters. Over long periods of time, even seemingly low inflation rates eat away at the purchasing power of our assets. This is one reason that “safe” investments (e.g., savings accounts, CDs, short term bonds), can be among the riskiest investments you’ll ever own.
A second important lesson is the power of small numbers. Take inflation for example. Instead of assuming a 3% rate over the next 84 years, let’s assume a 3.5% rate. While that may not seem like a big difference, it lowers the purchasing power of our investment in today’s dollars from $84 million down to $56 million.ALSO
The same is true with rates of return. Instead of assuming a 10% return, let’s assume a 9% return. In 84 years we will not have amassed $1 billion. Rather, our investment will grow to only $487 million. It’s hard to imagine that a 1% difference can cost us over $500 million, but that’s the power of compounding.
Let’s bring our example back down to earth. Instead of investing for 84 years, let’s keep it to a more typical 40 year career. Again maxing out our retirement accounts at a 10% return yields $12.3 million after 40 years. Lower the return to 9% and our nest egg drops to $9.1 million. Think about that the next time an investment advisor or actively managed mutual fund wants to charge “just” one percent in fees.
There’s one more thing our race to $1 billion can teach us, and it’s the importance of time. Recall that it took us 84 years to reach the magic billion. Imagine if instead we invested for just 83 years. How much would we have accumulated? The number drops by almost $100 million.
And back to our more realistic 40 year example. If we shorten our investment period by just one year, our $12.3 million retirement fund drops to $11.1 million. That one year cost us more than a $1 million.
Compounding works it’s magic as our investment horizon expands. The last year is far more valuable than the first, at least in terms of absolute numbers (you can’t get to year 40 without starting with year 1).
Here are the key takeaways:
- Start investing today. For compounding to work, you must give it time. Even losing a single year can cost you a lot of money.
- What are billed as “safe” investments may prove to be the riskiest of them all. That’s not to say that bonds have no place in a portfolio. But successful long-term investing requires significant exposure to equities.
- Every percent matters. Do not let anybody suggest that a 1% fee is “reasonable” or insignificant. It is neither.
There are 2,043 billionaires in this world. Approximately one-quarter of them are from the US. Millionaires? We boast roughly 16 million of them. Clearly, it’s hard to amass such a large fortune. In fact, when it comes to getting rich, a billion is an order of magnitude greater than a million. Millionaires seem to be a dime a dozen. Not billionaires.
When a person can amass such an unfathomable amount of wealth, it piques the interest of our global population, much of them steeped in poverty rather than wealth. But does that mean we should be envious or enraged at the people at the proverbial top? The truth? Whether you’re a victim or a champion of our capitalistic society largely depends on your financial situation.ALSO READ: PHP GUI Development Tools
Some of us look at those who’ve attained such unimaginable wealth with disdain. Others, with envy. Me? I want to know how they did it. I want to understand the inner workings of their minds. How did they navigate their way to such sensational success? How did they avoid all the perils and pitfalls that seem to entangle much of our civilization?
I have immersed and inserted myself into a circle of individuals to specifically answer this question. I’ve surrounded myself with people living life at the highest level because I am curious how they did it. Is there some secret sauce? Some magic formula? Some unknown principles or techniques?
Table of Contents
What it takes to become a billionaire
You’re likely asking yourself what it takes to get rich. But not just rich. Rich at the highest level. How do you go from broke to billionaire? Most people might simply want to have positive cash flow or even a million dollars in the bank. But does a million dollars really cut it these days? I suppose that depends on where you live and what you do.
But billionaires are a different breed. It’s a different world. Spending time with them is more likened to fabled fantasies rather than actual reality. The world truly is their oyster. Now, if you want to get there, or you’re just looking to become a multi-millionaire, there are some strategies that will propel your growth.
In fact, there are five strategies these billionaires have used to go from broke and hopeless, to absolutely on top of the world. If you’re looking to replicate their success, then you need to heed the following strategies and take them to heart. One other thing to keep in mind is that you’re far less likely to attain this type of success without owning your own business.
But if you’re already an entrepreneur or a business owner, then it’s a matter of adapting. Not only do we adapt to survive, but we must also adapt to thrive. Look at the following strategies and see how you can adapt them to your business, or to potentially pivot your business to strike while the proverbial iron is hot in one sector or another.
Most people think that it’s impossible to go from broke to billionaire. But it’s been done repeatedly. Individuals including Roman Abromovich, Francois Pinault, Howard Schultz, Oprah Winfrey, Shahid Khan, Do Won Chang, Ralph Lauren, John Paul DeJoria, Larry Ellison and Mohed Altrad were once flat broke. But they all became billionaires.ALSO READ: Profile Maker Free
How did they do it? First, and foremost, by harboring the following skills. And second, by wielding one of the five strategies that you’ll find below. As you read the list and the strategies, ask yourself the following question. How many of these skills am I employing and how can I adapt these strategies to my business today, right now?
- Leverage an abundance mentality and laser-focus your mindset
- Become an expert at business networking
- Overcome the often-stifling fear of failure
- Effectively manage your time
- Create long-term goals and take daily action towards them
- Never give up no matter how tough things might be
- Focus the power of your thoughts on the positive over the negative
- Never look for shortcuts or try to cut corners
- Understand the underlying principles of sales and marketing
- Become a fervent brand-builder
Being Passionate About What You’re Doing
None of the self-made billionaires studied were lukewarm in their excitement and commitment to the things they chose to spend their time on. Irish-born brothers John and Patrick Collison became billionaires in November 2016 when fresh investments hiked the value of their online payment startup Stripe at $9.2 billion.
The billionaire brothers were writing software code even before they were ten years old. Their company, along with Facebook, Airbnb, Instagram, and SnapChat, are prime examples of innovation that were mapped out by young entrepreneurs in their twenties.
Embracing Innovation
A product doesn’t need to be different or new, like Uber and Airbnb. They can be based on existing solutions or platforms but reimagined or reconstituted in a way that better serves a certain market segment.
Snapchat, at its core, for instance, is just messaging, but its appeal to millennials has been phenomenal simply because the service resonates with how the particular generation communicates. The trick to building a business that can propel you into the billionaire club is to be open and actively seek out different ways of looking at a problem and solving it.
Conclusion:
Not many people think they can become a billionaire in 10 years. But it’s actually possible. More than 3,000 people have hit the $1 billion mark over the past 10 years. Plenty of billionaires got their wealth through transfer of ownership or selling their companies. And while you cannot guarantee becoming a billionaire, if you work hard and invest wisely, you can at least boost your odds of reaching that goal.