If you are an American, the answer is about 20 years. For Mexicans it’s over to 300 years. As you can see from the graphic below, based on a country’s median income, America still provides the best opportunity for the average Joe to get to millionaire status within their lifetime. The calculation for the table below is rather basic – $1 million divided by the average household income. The American average household income is around $50,000, hence the ~ 20 year figure. Of course in reality the after tax net saving and investment amounts for most American households is far less than $50,000. So while 20 years may sound like a long time, most of us need way more than that to reach the six figure mark.
While a million dollars sounds like a lot it is by no means a guarantee of financial freedom. In fact to retire with an annual income stream of $50,000 a year you would need more than a million dollars in savings – so the earlier you start the better. And despite everything you read becoming a millionaire basically boils down to good saving and investing habits instilled via financial self discipline.
3 thoughts on “How Long Will it Take To Become a Millionaire?”
Interesting. I guess it really depends on what a person is doing to try to earn that million dollars, though. It really would depend on where they are investing their money and/or what business they are involved in.
Correct. According to Wikipedia Purchasing power parity (PPP), “is a technique used to determine the relative value of currencies, estimating the amount of adjustment needed on the exchange rate between countries in order for the exchange to be equivalent to (or on par with) each currency’s purchasing power. It asks how much money would be needed to purchase the same goods and services in two countries, and uses that to calculate an implicit foreign exchange rate. Using that PPP rate, an amount of money thus has the same purchasing power in different countries. “
Nice graph. It would have been interesting to factor in the cost of living of the different countries. Is that what the PPP varient is supposed to be telling you?