How Much Do You Need to Save Each Month to Become a Millionaire?

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KEY POINTS

  • Becoming a millionaire can provide a great deal of financial security.
  • The amount you need to save to become a millionaire depends on a couple major factors, including your investment returns and your timeline.
  • The earlier you start saving, the less you need to put away each month.

Have you ever dreamed of becoming a millionaire? While you may think having a seven-figure net worth is just a fantasy (or a lottery ticket away), the reality is that many people can achieve this worthy goal and get the financial security that comes with it.

If you want a chance at becoming a millionaire, you'll need to decide how much to save each month, though. And that can be a little tricky.

Here's how much you need to save to become a millionaire

The exact amount that you are going to need to put away to become a millionaire is going to depend primarily on two factors:

  1. How much time you have until you want to become a millionaire
  2. What returns you earn on your investments

Obviously, if you're putting money into a savings account and getting a 2% return, you're going to need to save a lot more than if you're making solid investments in an account with a brokerage firm and earning a 12% return on investment (ROI).

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So, just how much would you need under different circumstances? The table below shows the required monthly savings to hit millionaire status in a few different scenarios.

If you want to become a millionaire in this many years: You must save this much every month if you earn a 5% average annual ROI You must save this much every month if you earn a 10% average annual ROI You must save this much every month if you earn a 12% average annual ROI
10 $6,625.37 $5,228.77 $4,748.67
20 $2,520.21 $1,454.96 $1,156.55
30 $1,254.28 $506.60 $345.29
Source: Author's calculations

Can you make a seven-figure net worth happen?

As you can see above, it is entirely possible to put a reasonable amount of money into a brokerage firm each month and still become a millionaire. The trick is that you need to start early if you don't want to have to save a lot of money each month. If you have a long timeline, almost anyone can eventually become a millionaire even if you don't have a ton of spare cash.

If you are getting a later start, though, it may still be possible to amass seven figures. The key is saving a lot more each month and being more aggressive with your investments. You can do that by taking on a side gig to help you earn more money to invest or by trying to increase your earnings -- and then by developing an investment strategy that you're comfortable with.

The good news is, you can increase the amount you save over time so if you feel like you're behind, you can get started today in working toward becoming a millionaire. Investor.gov has some calculators to help you figure out your necessary monthly savings based on your age and projected returns, so check it out and start saving. The sooner you start, the more likely you'll be to hit your target.

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