It doesn’t matter how old you are or your current financial situation — anyone can become a millionaire.
So whether you’re a student who wants to know how to become a millionaire by 30, or someone older looking to reach seven-figure status in time for early retirement, take some relief in knowing that it can be achieved with financial discipline and investment sense.
Besides winning the lottery overnight, starting a successful business or moving into a wildly well-paid job, learning how to become a millionaire in the UK is largely about saving and investment over the long term.
According to Sarah Stanley Fallaw, the director of research for the Affluent Market Institute and author of the book "The Next Millionaire Next Door: Enduring Strategies for Building Wealth," millionaires have six notable attributes and behaviours that help them build and maintain wealth, regardless of age or income. Here’s the breakdown, with tips on how you too can adopt them.
Save more, spend less. This is a mantra to live by if you want to become a millionaire. By saving a large portion of income you free yourself from a paycheck to paycheck lifestyle and can start to save for investment. Even millionaires often live and spend comfortably below their means. In fact, 50% of millionaires budget and consider themselves frugal, according to Fallaw.
Most people in the UK could do more to increase their savings and cut costs. According to the Office for National Statistics, the average weekly household expenditure on goods and services is at the highest since 2005, after adjusting for inflation. And the households’ savings ratio is at an all time low: 3.9%.
Tip: For those just starting to save and kill debt, focus on keeping housing, food and transportation costs low. Even if you can afford it, choose a rent or mortgage that doesn’t take much of your income. Take public transport, bike and walk when possible. Buy a second-hand car if you need one. Cook at home. Practice self-control and avoid the temptation to blow your savings on trips, take-away meals and shopping sprees.
Together, these frugal habits help you build up savings for investment.
Time is money. So do as millionaires do and spend your time wisely by studying and developing a written financial plan. These steps help build confidence around money management and investing.
Tip: If you haven’t already, you can start learning basic financial-literacy and advance your understanding over time by reading finance and business newspapers and magazines, listening to financial advice podcasts, watching videos online, and seeking advice from experts. You can also take some online financial education courses, such as free classes offered by The Open University and The Money Charity.
Many millionaires invest in real estate, but they also invest in financial markets, particularly in low-cost index funds like Vanguard. You can learn about trading and investing with online brokerage platforms like Freetrade, Revolut or eToro, which cater to those on a learning curve with low commission costs.
Your financial journey towards millionaire status won’t always be a smooth ride. But Fallaw says millionaires are more likely to take personal responsibility for the outcomes of their financial choices—for better or worse.
Tip: If you want to take responsibility for your financial choices, you can start by arming yourself with data. The Money Dashboard app provides an overview of your income and spending habits across accounts, categorises spending into categories like ‘bills’ or ‘entertainment’, and helps create budgets and monitor progress towards goals.