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How $737 a Month Could Make You a Millionaire

By Christy Bieber – Oct 6, 2021 at 8:18AM

Key Points

  • You may not need to save as much as you think to become a millionaire.
  • The amount you'll need to save depends on when you begin investing.
  • Your returns can also impact whether you become a millionaire.

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A seven-figure net worth is in reach in the long run.

For a long time, the term "millionaire" was synonymous with wealth. While this may no longer be the case, saving $1 million can still go a long way toward providing you with financial security. 

The good news is, you may not need to invest as much as you think to hit your $1 million target. In fact, depending on when you start investing and what your returns look like, it's easily possible to become a millionaire with just $737 a month. Here's how. 

Adult reviewing paperwork with laptop.

Image source: Getty Images.

How to become a millionaire by saving $737 per month

If you want to become a millionaire by saving $737 per month, there are two things you need to do:

  • Invest that amount consistently every month for 30 years
  • Earn an average 8% annual return 

This should leave you with just over $1 million at the end of your 30-year period. And, for many people, taking both of these steps are reasonable.

After all, if you wanted to retire a millionaire at 67, you'd have to start investing $737 per month by age 37. Most people are well into their careers at that point and Americans aged 35 to 44 have a median annual salary of $58,188 -- so that would be just about 15% of your income. That's what most experts typically recommend setting aside for retirement. 

Of course, if you start earlier, you could reduce the amount you must save to hit your $1 million target. Someone who starts saving at 25 and who wants to retire at 67 would need to invest just $273 per month. The problem is, it's too late for a lot of people to go back in time. But, even if you're well beyond your 20s, saving just $737 per month still makes it possible to achieve your goal. 

If you're older than 37, of course, you'll need to bump up the amount you're investing. But with government help in the form of retirement tax breaks as well as a 401(k) match if your employer offers one, saving $1 million may still be in reach if you can invest a bit more each month. 

You'll also need to earn an 8% average annual return to be on target. With the S&P 500 producing average annual returns of around 10%, that should be easily doable -- even if you just invest in index funds that track the performance of the market. You do, however, need to be sure you're exposing yourself to an appropriate level of risk and building a diversified portfolio -- whether that includes stocks, bonds, cryptocurrencies, ETFs, or a mix of all different investment types. 

Now, $1 million may not necessarily be enough for retirement, but it is definitely a good start -- and it's much more than most people end up with. So if you're 37 years old or younger, start investing your $737 per month today to get on track to a seven-figure nest egg. And if you're older, figure out your magic number and get to work so you can have the financial security becoming a millionaire provides. 

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