15 Ways to Become a Millionaire by Age 50 (or Later)

There's a good chance that you can become a millionaire by the time you retire -- or at a minimum, you can enter retirement with a much heftier nest egg than you thought possible. That's great news, because Social Security alone, or Social Security and a small nest egg, are not likely to provide enough financial security in your later years. Here are some steps to take that can get you that million dollars.

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This will surprise no one, but if you want to achieve millionairehood as early as possible, you'll want to start saving and investing as early as possible. After all, if you're hoping to retire early at 55, your money will have only 15 years to grow if you start saving and investing at 40, but it will have 25 years if you start at 30.

ALSO READ: Want to Become a Millionaire Well Before Retirement? 3 Key Moves to Make

For many of us, it's far too late to start saving and investing at age 30. Fortunately, we can still aim to have our money grow powerfully -- if we regularly invest meaningful sums. In many, if not most, cases, that means a lot more than the standard recommendation of 10% of your income. Ten percent might be fine if you start investing at 25 or 30, but most of us need to catch up and build our nest egg aggressively if we want a financially secure retirement.

Next, it's important to invest effectively. After all, you might be saving and investing 50% of your income for many years, but if you're only parking that money in a money market account or a CD, it won't be growing very fast, at least in our recent interest rate environment. In general, for long-term money, the stock market is a great wealth builder, outstripping bonds, gold, and most other alternatives.

So consider learning about stock investing and spreading your dollars across some carefully researched, healthy, and growing stocks. This takes some time and skill, but it can be very profitable -- and even fun. Keep up with your holdings regularly, such as every quarter, when they report their earnings, and review your performance regularly, too. If you're not beating the overall market, you might want to just join it, via index funds.

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Low-cost index funds are the perfect investment for most of us -- especially those without the time or interest in becoming serious students of stock investing. Even Warren Buffett has recommended them for most investors, and he has directed that much of his personal wealth be put into an S&P 500 index fund for his wife when he dies. Index funds aim to closely match the performance of the indexes that they track. So an S&P 500 index fund will deliver roughly the same returns as the S&P 500 index of 500 of America's biggest companies. That's pretty good, and gobs of managed mutual funds have failed to top that over long periods.

5 Winning Stocks Under $49
We hear it over and over from investors, “I wish I had bought Amazon or Netflix when they were first recommended by the Motley Fool. I’d be sitting on a gold mine!” And it’s true. And while Amazon and Netflix have had a good run, we think these 5 other stocks are screaming buys. And you can buy them now for less than $49 a share! Simply click here to learn how to get your copy of “5 Growth Stocks Under $49” for FREE for a limited time only.

Don't forget to make good use of retirement accounts such as IRAs and 401(k)s, of the traditional or Roth variety. Each offers tax breaks: Traditional IRAs and 401(k)s take pre-tax contributions, lowering your taxable interest up front, while Roth accounts accept post-tax money, offering tax-free withdrawals in retirement but no up-front tax break. Note that 401(k)s often feature matching funds available from your employer. If yours does, max that out, as it's free money.

All this saving and investing may prove impossible if you're not living below your means -- spending less than you earn. A good budget can help you sort out your financial spending and set priorities, such as housing, food, and retirement savings. If you have money left over after you've taken care of essentials, including your contributions to investment accounts, you can spend it on whatever you'd like. Avoid living beyond your means, as that leads to big trouble.

ALSO READ: The Best Budgeting Apps for 2021

If your income doesn't offer enough on which to live comfortably while saving and investing aggressively, you might need to take some steps to save more and spend less. You can probably identify a bunch of ways to do this by thinking inside and outside the box. For example, you might cancel a gym membership you don't use, make more use of the library instead of a bookstore, mow your own lawn, and dine out less often.

Beyond cutting your spending, you can also beef up your investing by bringing in more money. That might be via a part-time job you hold for a few years (or many years), or a fun side hustle, such as driving for a ridesharing service, selling items you've crafted, or offering lessons in subjects you know well, such as a language, an academic subject, or music. Making just $200 per week can generate more than $10,000 (pre-tax) for investing.

Good financial management encompasses more than just your investment accounts -- it also includes all aspects of your personal finances, such as insurance, taxes, banking, debt management, and credit cards. With insurance, for example, you should look for lower-cost insurance policies every year or two, as your lowest-cost insurer today may not be your lowest-cost one in the future. Consider raising your deductibles on policies, too, as long as you'll still be able to pay them, if needed. Many millionaires today routinely make savvy financial moves, such as not buying new cars until they really need them, shopping with coupons, and living in smaller homes than they could afford.

5 Winning Stocks Under $49
We hear it over and over from investors, “I wish I had bought Amazon or Netflix when they were first recommended by the Motley Fool. I’d be sitting on a gold mine!” And it’s true. And while Amazon and Netflix have had a good run, we think these 5 other stocks are screaming buys. And you can buy them now for less than $49 a share! Simply click here to learn how to get your copy of “5 Growth Stocks Under $49” for FREE for a limited time only.

By now, you may have realized that for best results in your financial life, you'll want to keep learning. The more you learn about investors -- perhaps by reading up on great investors and how great companies became great -- the better your investment results may be. The more you keep up with changing tax rules, the more you may be able to save on taxes. Every dollar saved over the years can mean more contributions to your investment accounts, helping them grow faster.

ALSO READ: 4 Warren Buffett Lessons From His Latest Shareholder Letter

Once you're invested in stocks, you'll ideally want to keep up with your holdings. You can do so every quarter at earnings report time, and you can also just occasionally look up news stories on the companies in which you're invested.

Check your performance regularly. Take note of how well your stocks are doing. This is a good way to review yourself as an investor, too. If the stock market has generally been rising but most of your holdings have fallen or not risen much, you may have chosen poorly, or perhaps you simply overpaid for stocks that were so richly valued that they were likely to retract at least a bit. Reading up about other investors -- or simply talking with others who invest -- can help you learn about mistakes to avoid and smart practices to adopt.

It's often smart to rebalance your portfolio now and then. You may, for example, have a desired asset-allocation mix, with, say, 70% of your portfolio in stocks, 5% in cash, 20% in bonds, and maybe even 5% in a cryptocurrency. (Cryptocurrencies, such as Bitcoin, are rather complex, so be sure you understand them fairly well before investing any meaningful sum. And plenty of smart investors have only disdain for them, so you'll be in fine company avoiding them entirely, should you choose to.)

If, after a year or two, your different asset classes have grown at different rates so that you're now, say, 80% in stocks, 5% in cash, 10% in cryptocurrency, and 5% in bonds, you would rebalance by selling some stocks and cryptocurrency and buying some bonds, to restore your desired mix.

ALSO READ: 4 Signs You'll Be a Millionaire Investor Someday

The last, and perhaps most important, step toward becoming a millionaire by age 50 -- or any age -- is simply sticking with your plan. It's very easy to get discouraged and give up, as we humans tend to do with all kinds of things. But saving for your future is vitally important, even if you don't quite reach a million dollars. Be determined -- and you'll thank yourself later.

5 Winning Stocks Under $49
We hear it over and over from investors, “I wish I had bought Amazon or Netflix when they were first recommended by the Motley Fool. I’d be sitting on a gold mine!” And it’s true. And while Amazon and Netflix have had a good run, we think these 5 other stocks are screaming buys. And you can buy them now for less than $49 a share! Simply click here to learn how to get your copy of “5 Growth Stocks Under $49” for FREE for a limited time only.

None of these steps involve any rocket science. To amass wealth, you just need to be very mindful of your money and save and invest regularly -- and effectively. You may be able to reach millionairehood by age 50 or perhaps some years later, or you may not quite get there, given the time you have left before retirement and the sums you can invest. Regardless, you can probably make your retirement more comfortable and less stressful by taking some actions now.

Selena Maranjian has no position in any of the stocks mentioned. The Motley Fool owns shares of and recommends Bitcoin. The Motley Fool has a disclosure policy.