$82,353 is the Salary You Need To Make To Obtain Millionaire Status
Millionaire Status, Is it Even Possible Anymore in 2024 and Beyond?
Turns out, becoming a Millionaire in the US is easier than advertised. Considering that American boast 4 out of 10 millionaires worldwide; the degree of social mobility is there. It makes more sense than those “Make Money from Amazon without Selling any products.”
6.4% to 22.3% are your odds of becoming a millionaire in the US, based on data from the Federal Reserve Board’s Survey of Consumer Finances. These odds are further improved by the quality of your choices. From a focus on education, soft skills, and in-demand fields; with those parameters, it’s fairly easy to reach a six-figure income in your lifetime.
Unfortunately, the Get Rich Quick ads are distracting the masses.
I spent the last 10 years helping people, either through resume building, financial literacy tips, articles, or personal 1-on-1s. So much so that I ended up publishing $77,000+ is the Magic Number for Million Dollar Millennial (via Linkedin, 2018).
In the end, I realized that most people complicate the math.
Table of Contents
Financial literacy concepts were often ⇢ too broad or maybe too complicated.
Start throwing terms like 401k, Dow Jones, $VOO Invest, compounding interest, dollar-cost-averaging, Individual Retirement Accounts, ROTH, Social Security, etc; you may as well speak Latin.
Instead, keep the information brief as an entry point. For example, why worry about affordable homes, when you don’t have a budget, any savings, or even decent credit?
Seriously, you need to stop skipping steps. Contrary to popular belief, most Millionaires don’t skip steps. While few the highly skilled or gifted people, most will have to apply a more sustainable path to wealth.
This article is all about how. To prove it, my wife and I have been breaking down our net worth every month. There is no secret shortcut and you won’t need to buy a book regurgiating the mantra of paying down your debt. There is more to wealth than baby steps or therapy. You have to take adult strides in order to make the financial breakthrough that keeps most people average and broke.
At least $1 Million Needed For Retirement? How?!
While thinking about Retirement is not sexy in your 20s or 30s, just remember eating catfood patty burger isn’t the future golden age vibe you are looking for. Lifestyle in America has been marketed through youth since the late 1940s. As such, most people strive to live in the moment forgetting that every $500 spent today, is worth over $2,600 in retirement.
To put it more plainly, $6,000 of frivolous spending in 2023, is like throwing away $31,157 of 2065 money.
Wait, 2065 is a long way away? Well not exactly.
The average lifespan is up to nearly 80 years old. You are very likely to hit that ripe old age. Doing it broke, will only lead to you living in your kids’ basement.
Most Americans over 50 are worried that they don’t have enough to retire.
Although we can’t plan when we are going to die, we can make a great guess as to how much we will need. We have to think 25 years into the future.
See the Table Below for how to calculate your automatic millionaire expense needs.
Rough Estimate: 25x Annual Expenses Long-Term Spending Need
| Current Lifestyle | Current Annual Expenses | Multiply by 5% Inflation | Retirement Savings Need |
| Low to Moderate | $45,000 | $47,250 | $1,181,250 |
| Average Millennial | $57,000 | $59,850 | $1,496,250 |
| Urban (Metro Areas) | $68,000 | $60,900 | $1,522,500 |
| Moderate to High | +$100,000 | +$78,750 | +$1,968,750 |
So How Do You Get to Automatic Millions?
First, don’t panic.
Like you, I didn’t start off with a Million dollars. My mom never made more than $30,000 which put me and my sister squarely in the poverty range.
I lived for the “Free or Reduced Lunch Program” throughout Middle and High School. This is likely why I had near-perfect attendance. I completely understand how not having enough dollars doesn’t sit well. Just remember how your story started is not necessarily how it will end.
If you are reading this while in a financial bind, just know that one day your day will come. Part of the process is making peace with imperfection in a filtered social media area. The majority of influencers are struggling with high debt and not enough income. Don’t fall victim to comparative economics or the copy-and-paste syndrome.
Trust the path.
So How do you earn a million dollars in savings? Simple, we work the math backward this time. We have to figure out 1. how much we spend, 2. Determine How much to Save/Invest, 3. how much we need to make and that’s it.
1. $82,353 is How Much We Need to Make
The average annual expenses for a US Household totaled $72,967. Let’s say that’s $70,000 rounded down due to excessive higher-than-average price inflation on all goods.
You need at least that much after taxes. If our effective tax rate is 15% on average, then the starting amount would need to make is $82,353 annually. Fact-checkers: $70,000 divided by 85% to give us the pretax amount.
2. Either 25 percent or the minimum Savings/Investing at $30,000 Per Year
Without fail, the wealth-building rules are simple. Save/Invest either 25% of your gross pay or at least $30,000 per year. After that, you can set and forget it. This is easier than you think. This is how the rich got richer and how they hold on to most of their wealth through tax avoidance and wealth maximization strategies.
The execution is simple:
- Max out your 401k, IRA, and HSA.
- For 2024, the maximum contributions for a 401k, 403b, or 457b is $23,000 per working adult if they are offered at your job. For anyone over the age of 50, there is an extra catch-up contribution of +$7,500.
- Never miss the matching contribution and make sure you are allocated based on your risk profile at least.
- Traditional and/or Roth IRA contribution limits increased to $7,000 for 2024. For anyone over the age of 50, there is a catch-up contribution of +$1,000.
- For the Health Savings Account contribution limit, you are looking at $4,150 for 2024 with a catch-up of +$1,000
- Total without you doing the math is a savings of $34,150 annually. 401k for singles at $23k, IRA for singles at $7k, and HSA for singles at $4.15k. That’s well over $30,000.
- WARNING: Saving less than 20% is simply not going to cut it anymore. The Experts are lying to you; if you ask them, you will realize they save way more than 10%. It’s a TRAP!!!!
3. The Millionaire Salary You Need to Earn is $82,353 per year
It’s OK you don’t have to start making this number on day one. I started off my career making less than $21,000 before taxes. The mountain does seem large starting off but you can make it to the top.
If you get to this number by 25-30 years old we are in business. If you get married along the way, you can split it with a spouse. Half and Half is fine. $50k and $38k with one watching the kids part-time, that’s fine too. We aren’t adding any job promotions or side hustles.
Just good old salary and here’s the math:
| Years | Cumulative Contributions | Accumulated Interest Gained at Historical Avg. 8% | Total Remaining |
| 1 | $30,000 | $1,085 | $31,085 |
| 5 | $150,000 | $32,360 | $182,360 |
| 10 | $300,000 | $150,300 | $450,300 |
| 15 | $450,000 | $394,000 | $844,000 |
| 20 | $600,000 | $822,500 | $1,422,500 |
| 25 | $180,000 | $1,522,475 | $2,272,475 |
4. Retire as an Automatic Millionaire Two Times Over with More Than $2.272M
- Your total at the end of the game. Let’s say you started at age 30, that’s almost $2.3 million by 55. Not even including dividend investing for the long term.
- As long as significant issues don’t arise or you don’t start doing coke; you will be fine. I’d also say be moderate in your spending on homes. Don’t buy big homes. You will still be able to have a great time. Travel etc…
- 25-30 yrs old = 50-55 years old <— way before forced retirement age of 67.
Building toward a millionaire lifestyle
There you have it, the automatic millionaire path without paying anyone a dime. You are welcome.
Make at least $89,000 as a household. Allocate and invest no less than $30,000. And finally, continue to live your life. That’s all there is to it.
Again, you don’t have to start at $89,000 so it’s OK to have a goal. Focus on the Destination, not the starting line. Now Run!
Bonus: Here’s how TNFG became a millionaire household
Closing out the year stronger, as automatic millionaires or on the path
- Working on investing in the after-tax portfolio to hit the total of $100,000 in M1 Finance Brokerage focused on Dividend Income that generates at least $5,000 in passive Income by YE 2025. Check out the portfolio in real-time. If you like the platform and want to start investing, I have the $30 for $30 referral if you need it – https://m1.finance/SYdqDJ2SyADC
- Boosting back the EF savings with an additional $4,000 by YE 2024. Keep tabs on your savings, cash flow, net worth, investments, retirement, and more for absolutely FREE with Personal Capital! Sign up with my link & get a $20 Amazon gift card. *Terms apply. https://pcap.rocks/lawrencegonz
- Getting back to shape – HIIT Mornings. Running, and biking just pushing out effort. Health is Wealth. Even though it is lame to say, you will save more money this way.
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