Everyone dreams of becoming a millionaire one day but many people forget that the road to becoming a millionaire starts with becoming a thousandaire. If you are looking to start building wealth, becoming a thousandaire is the first step. In this article, we will talk about the importance of being a thousandaire, and how easy it is to achieve this financial goal.
What Is A Thousandaire? Why Do You Want To Be One?
A thousandaire is defined as someone who has a net worth of a thousand of some unit of currency. This is most commonly defined in pounds, dollars or euros. And by net worth – we mean the mathematical different between your assets and your liabilities.
Net worth = assets – liabilities
The average American earns about $72,090 in 2015, so achieving thousandaire status is not difficult for most people, you just have to a) commit and b) start implementing a few basic savings and investing strategies.
But first, lets talk about why you might want financial freedom- and the reality is that even though the term “thousandaire” is meant to be humorous, its a stop in the path to financial freedom. There are lots of reasons why you might want financial freedom – for example you might want to have mastery over your time and your choices. You might also want to have a greater impact in your community or impact on issues you care about. There are lots of reasons to have financial security. You just have to decide that you want it.
Next, you have to decide how to get there. There are lots of paths to wealth.
For example, you could:
- Save and invest consistently for decades
- Marry into money
- Become a CEO
- Sue someone and take their fortune
- Start a successful business
- Become a virtuoso and sell your talent
- Join a corporation and climb the ladder
And many others.
How To Become A Thousandaire – Some Guidelines
However, regardless of which strategy you’re following, there are some good basics investing and savings guidelines you’ll want to follow. These are:
1. Control Expenses:
Living below your means is an essential part of building wealth. This means spending less than you earn and avoiding unnecessary expenses. You might be surprised by how much money you can save by making small lifestyle adjustments such as cooking at home, driving an older car, and reducing your monthly bills through negotiations. The bottom line is that you’ll never gain substantial wealth if you spend more than you bring in.
2. Save And Invest Aggressively:
Saving and investing aggressively over time is should be #1 in the list of how to be a thousandaire. In the US, capital markets are risky, but are transparent and largely honest and intelligently regulated. This means consistently putting money in the stock market tends to be a good way to build your wealth over time. So, you’ll want to save and invest as much as you can.
The good news is that capital markets have largely democratized finance, which means you can start getting into stocks, bonds and funds with juts $1. So, the only barriers to entry are your interest, and ability to learn and come up the with money to invest.
Also, investing doesn’t have to be complicated or expensive; start small and work your way up. If you know nothing about about investing, here is a good standard playbook. First, open a Roth IRA at one of the major brokerage houses (Schwab, Fidelity, etc.), transfer some money into the account and buy shares in the Vanguard S & P 500 index fund. If you don’t want to put your money on the market, go ahead and buy a bunch of CD ins your IRA.
If you’re past the beginning stage – plow as much cash into saving and investing as you can.
The reality is that your saving and investing will add up fast. If you start with 50 bucks, and every month buy certificates of deposit at 5% , you’ll be a thousandaire in a year and a half. That’s super easy.
Heck, you don’t even need to come up with the starting capital. There are tons of stock market apps that will pay you to sign up. Of these, Robinhood is the easiest to use and reliably pays. The setup is super simple:
✅Sign up with this link
✅Get approved
✅Link a bank, skip the deposit
✅Claim free stock
Its a total no brainer, tens of thousands of people are making money in the app, they had 23 over Million users in 2022.
As a final note here – what matters when it comes it investing is not so much the return your investments, rather the dollar amount you can save, (here is a persuasive arguement why). This is generally because the more you can save, the more quickly your wealth compounds. You want to save and invest as much as you can as soon as you can.
Sign up for Robinhood is here => here.
3. Set Financial Dreams and Goal:
Another key factor in how to become a thousandaire is goal setting. What high net worth millionaires do is define their dreams, then set goals around them. Then, what they do is set umbrella goals and daily goals tied to their umbrella goals (here).
You’ll need to do the same. For example, if your overall dream is to become a thousandaire, your overall umbrella goal might be to pay off your credit cards, then start investing $50 a month. In this case you’d want to set an overall measurable goal (such as be debt free by the end of the year). Then set daily goals. For example your daily goal maybe to earn an extra dollar a day, then invest it at the end of the week.
Then, you need to relentlessly execute on your goals. Review them every week and if you’re not meeting them, adjust accordingly. If you work at it long enough, you’ll start to make progress.
4. Start a Side Hustle:
Asking for a raise or switching jobs are frequently the most straightforward methods to make extra income. However, suppose that isn’t an option. In that case, you could consider starting a side hustle by transforming your hobby into a business, creating a dropshipping store, starting a business, or freelancing your skills, among other things. Other good ideas are flipping things on Facebook Marketplace or Ebay. And, if your goal is becoming a thousandaire, you don’t need to move a lot of transactions or do a ton of extra work to get a thousand saved.
5. Surround Yourself with Like-Minded People:
You are the sum of the people you surround yourself with, so choose them wisely. Build a network of friends who have the same financial goals as you, who can encourage and motivate you to keep pushing yourself to achieve your goals.
How To Become A Thousandaire – Case Studies
Becoming a thousandaire is quite possible – here are three studies of people who’ve done it.
Stephonee – NetWorth of $35,000.
In 2016, Stephonee, over at Poorer Than You – grew her net worth from -$30,000 to $35,000 (here). She did it by maintaining a one car family, saving regularly and continually contributing to her IRA. Stephonee also kept her debt levels low and regularly paid off her student loans. She did this consistently for a long time – and got good results (here).
Kat – Net Worth of $10,400.
Kat, the blogger at MoneyProwess had a net worth of $10,380.35 dollars in 2016 (here). She was able to achieve this by aggressively paying off her credit card debts, consistently contributing to her retirement accounts and owning real estate (here).
Kate – Net Worth of $43,000.
In 2015 the blogger at Good Night Debt, Kate, was worth about $43,000. Per her blog, she achieved thousandaire status by saving consistently, tracking her money and focusing on paying off debt. She also consistently contributed the maximum to her tax advantaged retirement accounts and regularly updated her net worth to track her progress towards her goals (click here).
All three of these case study examples have a good amount in common – the thousandaires consistently saved, reduced debt and invested in stocks and real estate.
For More On This – Read “What Is A Thousandaire- And How Can I Become One?“.
Finally, since becoming a thousandaire is pretty much about mastering the basics of money management, here is a pretty good video on personal finance basics.
Wrapping This Up – Yes, You Can Be A Thousandaire!
Becoming a thousandaire necessitates a shift in mindset and a commitment to personal development. Building wealth takes time, effort, and dedication, and there’s no shortcut to it. Nonetheless, by painting a picture of your dream life, setting umbrella and daily goals, saving diligently, investing consistently, exploring new income streams, reducing debt and surrounding yourself with like-minded people, anyone can become a thousandaire.
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James Hendrickson is an internet entrepreneur, blogging junky, hunter and personal finance geek. When he’s not lurking in coffee shops in Portland, Oregon, you’ll find him in the Pacific Northwest’s great outdoors. James has a masters degree in Sociology from the University of Maryland at College Park and a Bachelors degree on Sociology from Earlham College. He loves individual stocks, bonds and precious metals.