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Who Wants to be a Millionaire? J Money Does And So Do I

By on Jan 31, 2014 in Goal Setting, Money Habits | 23 comments

Who Wants to be a Millionaire LogoWhen I was at FinCon 2013, a financial blogger conference in St Louis, I met a guy named J. Money who is the founder of BudgetAreSexy.com. Now, I had been familiar with J.and his site, however, I will be honest I hadn’t spend much time at it before going to FinCon. One day I was perusing his blog and I came across his Million Dollar Club. He had a list of things that he pledged to do every year and if he was able to do this consistently he would be a millionaire. Could it be that easy? Can one just set financial goals, make a plan action to achieve them, and then become a millionaire? J’s goal is to be a millionaire by the time he is 42 years old and from the looks of it, he is on track.

Million Dollar Club LogoIs the Million Dollar Club legit?

To make sure that this was a club worth joining, I decided to run some numbers using teh CNN Money Millionaire Calculator. According to J. Money’s site he has over $360,000 in assets in various IRA accounts. If he puts $22,000 into his SEP IRA and maxing out both he and his wife’s Roth IRA’s at 11,000 per year, they will have $1 Million is 9 years and 10 Months!

So if J. Money can do it, why can’t I? Now I don’t have as much invested as he does because we are putting most of our excess cash into paying off our mortgage. However, once our mortgage is paid off we will have about $2,000 extra dollars each month to invest. With that in mind, let’s see how long it will take for us to have $1 Million. When we start investing $24,000 per year at a conservative 6% return, we will hit our first million in 14 years and 3 months. Not too shabby, right?

Hayes Millionaire Calculator

Our First Million Estimate

What is the point of being a millionaire?

For many people it is the idea of Financial Independence: having enough money that you can continue your lifestyle and not have to work if you don’t want to. We have enough financial resources to do what we want when we want, but I do still have to work. Having a million dollars will give me the ability to work less and hire people to do the aspects of my work that I don’t enjoy as much. Now I don’t necessarily need a million dollars to achieve this, however, it will be helpful in making this possible.

My pledge

Each person has to make a pledge of what they are going to do in order to hit the million dollar mark. Here is my pledge:

  • Pay off our mortgage by the time I am 35
  • Max out my Roth IRA each year
  • Invest $24,000 per year into tax favored accounts once mortgage is paid off
  • Drive used cars and never have a car payment again

Want to join the club?

At this point there are 126 people who have joined the Million Dollar Club, 4 of which have become millionaires since they joined. Check out the details for each of the success stories below:

DINKs October Net Worth: Broke Through the $1,000,000 Mark

Thoughts of an Anonymous Lawyer

Debt Digger (private – must have permission to access)

If you want to join the club all you need to do is make your own pledge and then link back to Million Dollar Club or leave a comment on his page and he’ll add you to the list.

Do you want to be a millionaire? What steps are you taking to make it happen?

 

    23 Comments

  1. OF course I want to be a millionaire (I mean, really, who doesn’t?). My biggest obstacle is my income. I can’t hope to put anything away if I don’t start making enough money to more than cover my most basic expenses.

    • Stephanie that is so true. You do have to have enough money to pay your basic expenses before you can start investing for the future. Just keep in mind that your income will not always be what it is if you work hard and continue to add value to those around you. I have no doubt you can be a millionaire one day.

      Deacon Hayes

      February 1, 2014

  2. “Financial Independence: having enough money that you can continue your lifestyle and not have to work if you don’t want to” – YUP! It’s about what the money GIVES YOU vs the money itself. Though, we prob need more than $1 Mil to be really free, but still – gotta get that 1st one under our belt before we can get the 2nd ;) They say the 1st is the hardest, right?

    (Going now to add you as a new member to the club – Welcome!)

    J. Money

    January 31, 2014

    • Yep, the first million is definitely helpful to getting the second million, that is for sure. By the way, you already added me to the list (I am #117). It just took me a while to write the post about it :)

      Deacon Hayes

      February 1, 2014

  3. I think that’s a great goal. I have to wonder whether we’ll actually ever be millionaires though because, like you, being mortgage free is a key part of the plan. So our liquid assets are lower than they would be if on a different path, and we’ll reach financial independence before we have $1M in liquid assets. Tough to say whether we’ll actually have the guts to stop working and acquiring at that point.

    And, yeah, it’d be nice to actually call ourselves millionaires. That’s fancy!

    Done by Forty

    January 31, 2014

    • Do you plan on investing once the mortgage is paid off? Having no mortgage payment will be nice and I am sure it will give you a fair amount to invest in order to hit a million dollars. Not necessary, but I do think it is possible in your scenario.

      Deacon Hayes

      February 1, 2014

  4. Might as well add me too. Although my number is closer to $4M. My projections put me in the 2 comma club around 2020 right now, but we’ll see.

    I do appreciate the idea of being debt free and the guaranteed return associated with paying down my mortgage, but the facts are I’m still young and can afford the risk associated with dumping cash into the equity markets.

    • 2020 is right around the corner, that is awesome! Factoring in inflation we will probably have more than $1 million as well, but it is a good benchmark to strive for.

      Deacon Hayes

      February 1, 2014

  5. These days I don’t think a million dollars isn’t all that much. A lot of average joe’s who can manage their finances properly can retire with more than a million dollars. I think in order to be considered “rich”, you’ll need at least $10 million.

    Troy Bombardia

    February 1, 2014

    • I think “rich” is relative. To some guy in the outskirts of Uganda minimum wage in the U.S. is rich. I currently think of myself as rich when it comes the rest of the worlds population. Check out GlobalRichlist.com when you get a chance.

      Deacon Hayes

      February 1, 2014

  6. Hey, Deacon ~

    I love J. Money but must admit that I haven’t checked out his $1 mil club. I consider myself in that “club” now because my net worth exceeds that number. $350k of that is attributed to my paid-in-full home, the rest is in investable assets. I don’t count cars, shiny objects, art work, etc., because they rarely net what you paid and usually far less.

    I’d really like to have 1.6 in investable assets so that when I “retire” I can withdraw 4%/year and live on that. That is the minimum I would feel comfortable with. So, I still have a way to go.

    However, where I am right now affords me the ability to be flexible. Today I have “choice” — before I felt trapped. The mind set is very different and really comforting.

    Love the post and the comments ~
    Ree

    Ree Klein

    February 1, 2014

    • That is great to hear Ree, congrats for already making it to the Million Dollar Club! I think your point about having a “choice” about what you do versus “feeling trapped” is huge. A lot of people would love to be in that position one day.

      Deacon Hayes

      February 3, 2014

  7. It’s all about setting goals and sticking to them. Great post!

    Michael Solari

    February 3, 2014

  8. Sure.. I would love to be a millionaire.. In fact, a million dollars may have very well have passed through my hands already (or it will soon)..

    My issue is that I don’t want to live poorly now, so that I can have the potential of living big later. I want to take vacations and have a decent house (near good schools), and I want my kids to be able to participate in whatever activities their heart desires, even if they are expensive.

    I am starting to save now, and I do plan on having a few million in the bank when I retire. But I do realize it will be many years from now when I likely get to that point.

    jefferson

    February 3, 2014

    • I don’t know Jefferson, if your niche site takes off you might have it sooner than you think.

      Deacon Hayes

      February 3, 2014

  9. “Do you plan on investing once the mortgage is paid off? Having no mortgage payment will be nice and I am sure it will give you a fair amount to invest in order to hit a million dollars. Not necessary, but I do think it is possible in your scenario.”

    We actually paid off the mortgage back in July, so while we were still investing throughout the mortgage pay-off, we’re definitely doing more now. Still, with our low expenses, we’ll hit FI before we hit a million in assets. I’m not sure we’ll have the drive to continue working just to get to a million…but we’ll see!

    Done by Forty

    February 3, 2014

    • I look forward to following your blog to find out what you decide to do ;)

      Deacon Hayes

      February 3, 2014

  10. I know I have a long ways to go but I would love to join the club. It will probably take me until around age 65 to get there, but I can see it happening. If my wife and I both make it I’m sure we would have total financial independence. My wife and I will be helped by the fact that the career field she wants to get into offers free living expenses as part of the benefits package. Having no mortgage for a bunch of years will probably accelerate the process.

    Jon@2-copper-coins.com

    February 4, 2014

    • Wow, that is great that her career field offers free living expenses. That will definitely help you stock away some cash.

      Deacon Hayes

      February 6, 2014

      • Yeah we are thinking it will be the x factor for us being able to join the “millionaire club.”

        Jon@2-copper-coins.com

        February 6, 2014

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