Want to Retire With $1 Million? Start With Just $200 a Month

I used to think you needed a six-figure salary or a windfall to end up with a million dollars for retirement. That's just not true.

If you can spare $200 a month, you can absolutely retire with $1 million. You just need to start as soon as possible and stick to your plan.

The power of $200 a month

Here are the real numbers. If you invest $200 a month and earn a 10% average annual return, which is roughly in line with the long-term average of the S&P 500, here's how your investment could grow:

• After 10 years: around $46,000
• After 20 years: around $137,000
• After 30 years: around $379,000
• After 40 years: around $634,000
• After 47 years: just over $1 million

That's the power of compound interest. It takes a while to ramp up, but by the time you hit year 30 or 40, your money starts growing way faster than you're contributing.

You'd only contribute $112,800 over 47 years, but you would end up with $1 million. That's nearly $900,000 in pure growth.

Where to stash your $200

If you're just parking money in a high-yield savings account, you won't hit $1 million. You need growth; and that means investing.

It's smart to start by opening a Roth IRA or traditional IRA if you're eligible. If your job offers a 401(k), especially one with a match, use that too. Low-cost index funds and ETFs are solid picks if you're not sure where to start. They're hands-off and historically reliable, though not completely without risk.

Here's a tip I give friends all the time:

Open an investment account through a reputable online broker, automate a $200 monthly transfer, and just start buying the S&P 500 Index. The hardest part is the first step, but it gets easier. Check out our list of the best online brokers now.

What if $200 feels like too much?

I get it. Budgets are tight right now. But you might have more wiggle room than you think.

And if $200 is truly out of reach, start with $50. The point isn't perfection -- it's consistency. Even a small start puts you miles ahead of where you were yesterday.

Don't let time slip away

The biggest mistake I see people make is waiting. They think they'll invest when they get a raise, when bills ease up, when life feels less hectic.

But the earlier you start, the easier this gets. You can make up for lost time later, but it'll cost you.

So if you're dreaming of a seven-figure retirement, here's your move: Start now. Stay consistent. Let compounding do the heavy lifting. Find the online broker that's best for you now.