How to Become a Millionaire Like Me

“I thought you worked full time?” you query.

I don’t like to toot my own horn, but I’m a volunteer! I figure corporate America needs all the help they can get these days and I'm willing to do my part.

Okay, I’m no millionaire, but I work in finance and am getting a masters in finance and I’d like to think I know something about it. Oh, yeah, and none of this advice necessarily reflects the views of my employer or anyone else I know in case you might want to sue them. It’s all me, baby. However, if an idea that is particularly brilliant does reflect views from my employer or someone who knows me, credit is duly given, because to do otherwise would be intellectual property infringement and they might want to sue me.

Also, this advice applies to people who have full time jobs and live expensive lifestyles while complaining that they never have enough money to start saving, investing, or paying off their debt. I don’t want anyone who is unemployed against their will or has prohibitive health issues thinking I don’t commiserate with their plight.

1. Save your damn money first. Seriously. Please. Take a portion of your paycheck and have it go automatically into a savings vehicle that incurs heavy penalties should you want your money back too soon. Something like buying longer term CDs or funding your IRA. Don’t worry about finding the best interest rates and seeking high-growth investments, yet. For now, park your funds in a CD or moderate allocation fund until you get enough finesse (and money) to explore things like hedging strategies, risk management, and estate planning.


2. Don’t worry about your precious “emergency fund.” Every personal finance guru touts the emergency fund like a kid and their favorite binki. Blanki. Wha wha. Whatever. Of course it’s an f-ing brilliant idea to have 6-9 months of income and expenses stored away. But how come so few people do it? Like overeating, smoking, or other damaging yet gratifying habits, spending a pile of cash is a quick train to Happyland. When it comes down to it, having thousands of dollars stashed in a place where you can get your grubby “I just gotta live my life” hands on them "in an emergency" will only buy you the security of the first plane ticket to Bangladesh or Box of Blahniks because the spirit moved you.


3. Fund your IRA or 401K plan first. Like I said, this advice doesn’t make sense financially, but so much of finance is psychology. For example, an IRA is a wonderful thing because you get penalized heavily for withdrawing money early. It’s a veritable retirement savings chastity belt. Anyways, my personal opinion is that once you start funding your IRA, you will get excited watching it grow. It will sink into your brain that Savings Are Good. You will want to do more of this. You will then start your Emergency Fund. You will wake up on the count of 10. 1….2….3…


4. Don’t bother with a budget*. They are easy to manipulate, hard to track, and promises to yourself are painless to break. Like I said, take your paycheck and deposit a good portion of the money somewhere you cannot touch it for a long, long time. Then you will be left with less expendable income. Increase that stash-away portion over time. Math is simple. The less money you have left over, the less money you can spend. *Unless you do something idiotic like use a credit card to buy crap you don’t need or can’t afford.


5. Don’t use credit cards to buy crap you can’t afford. Unless you have the cash or income to back it up within 2-3 months. And by back it up I don’t mean managing the monthly minimums, I mean paying it off 100%. A credit card should be viewed as an extremely short-term loan. If you don’t make enough money to afford the flat screen TV, you have to go without. If you unwittingly decided you have to have a mélange of home entertainment goodies, then you will need a budget to help you wade through the morass of your financial faux pas. To be honest - if you are contemplating any of this, my previous advice won’t apply to you at all because you need help that cannot be found on blogs. See a financial professional and possibly, a doctor.


6. Enjoy your damn life, even if you make dumb mistakes. Mike and I made up a ritual on pay days. There is a song that goes with it. It’s called “Buying Shit That We Don’t Need!” Here’s how it works. We get paid. We think we are rich, we get the urge to go to Target and buy fun décor or scented items for the home. Especially anything that looks handmade or ethnic. We sing that song, then go shopping. It’s irresponsible, but the moral of the story is that even if Mike and I buy something we shouldn’t have, overall we are really prudent so if we run out and buy 90% off Christmas decorations – it’s okay. (I really needed them…)
   
   Happy Saving!!
   
   PS – Don’t cheat on your taxes. The IRS will find you and it will not be worth the money you “saved.”