A Look At How To Make A Million Pounds As An Average Person
During my 9-5 job there are always those quiet moments when you are just chatting with your colleagues and the subject of money comes up.
Someone always seems to ask “How much interest would I make on One Million pounds?” Or the other question asked is “What would you buy with One Million pounds“
The answers always seem to instigate mass conversation and it is a great way to waste a few minutes of an otherwise dull workday.
The one question that I don’t recall ever being asked is “How to make a million pounds?” That is the one question that really needs answering as I think if people knew it wasn’t as hard as they thought then they would be quite surprised and may take action.
What I will be doing is not only explaining how to make a million pounds but how to increase your overall Net worth. Having a net worth of one million pounds once you figure in property and investments is not actually that hard and I will walk you through it.
Some of my posts may contain affiliate links. This simply means if you purchase something after clicking one of the links I may receive a commission at no extra cost to yourself. Many thanks for the continued support.
Before I go over how to make a million pounds I am going to quickly answer the two questions at the start and remember this is just my personal opinion so here goes.
“What would you buy with One Million pounds?”
Well, I would probably pay off my mortgage and then spend a bit of money on doing up some areas of my house. This would set me back about £300k. I would then spend a little on some nice holidays for my wife and me and with the remaining amount of probably 650k I would probably invest in some long term index funds to make sure I was set up for later life and would probably allow me to retire earlier.
“How much interest would I make on One Million pounds?”
*Disclaimer: This is not financial advice, These are just my personal opinions. Before making any decisions on where to put your money I advise you to seek independent financial advice.*
Well, this depends on how you normally accrue interest. Unfortunately, you will not accrue much interest if you put it in your standard savings account.
Well with savings account interest at an all-time low. The highest I could find was on a fixed long term deal. This was 0.7% which means if you stuck your lump sum of 1 Million pounds into it and left it for a year you would make around £7,000 Interest. Not much eh. I would want my money to work harder than that.
A stocks and shares ISA would probably be my next best route to earn good interest. With these although your money will go up and down and you can potentially make a loss the expected reality is a 5% return. That would give you £50,000 in one year, That is a much better return on your money.
Depending on how much risk you were willing to take on you could get up to 10% or more on your investment. Most investments are meant to be the long term of 5 years or more as this is how you will limit your risk of losing money.
How To Cheat Your Way To One Million Pounds
There are ways that people become unlikely millionaires and sometimes it is just plain good luck and fortune that puts people in this fortunate position although I have always felt that if you haven’t worked hard to achieve your wealth it can go unappreciated and be spent frivolously.
Inheritance is one way of achieving this. You may not inherit a 1 million pound house but you might inherit one worth £500,000 and this could quite easily push your net worth over 1 million pounds.
Inheritance comes in many forms but it is the easiest way of increasing your net worth. I have at least 2 friends that when their grandparents die they will inherit their homes and any money remaining.
Of course, it is not nice to lose anyone however this is the quickest way to increase your net wealth If you are fortunate enough to have relatives that actually looked after their finances for later life.
Entering competitions is a good way of increasing your net wealth. There are not many that guarantee a million pounds but they are out there if you look. Three times a year my local radio station does a Million-pound draw. If you are lucky enough to win the daily amount which is usually around £10,000-£20,000 you can choose to either take that money or be entered into the Million-pound draw.
As you can imagine most people take the money which means by the time the draw is live there are only 50 or 60 people in it. That’s short odds for winning a Million pounds.
Some competitive competition experts or what we call Compers like to enter a hundred or more competitions per day in order to increase their chances of winning. This might not net you one Million pounds but it can increase your net wealth considerably.
I know so many people that play the Lottery religiously. One of them actually spends about £25 per week playing the main lottery and the Euro lottery. This is such a huge waste of money considering the odds are so high. I don’t know the actual figures but I’m pretty sure it is nigh on a 100,000,000 to one chance of winning.
If you win thats great but it is so unlikely I dont think it is even worth your time contemplating doing the lottery every week.
Let’s be completely honest you are not going to work your way to One Million Pounds if you still have car or loan payments. Store cards, Credit cards. You need to pay all of these off before you do anything else.
Most of this type of debt has very high apr and you will be paying it back for years if you pay off small amounts. The best way out is to switch your debt onto a Zero percent card if possible and then pay the absolute maximum you can spare each month.
Even if it takes a year or three. Get it done as you cannot move forward with debt hanging over your head.
Once the debt is clear not only can you move forward but you will now have spare cash from your 9-5 that you can make work hard for you.
No, I don’t mean sticking any spare cash you have from your wage packet in the bank. With interest rates at an all-time low that would be a waste and you would not earn hardly anything.
No, I mean put your money into a stocks and shares ISA. Stocks and shares ISA means you can stash away up to £20,000 tax-free per year and dependant on your level of risk you can earn anything up to 10% per year.
Even if you are wanting a low-risk portfolio you are likely to get at least 4-5% interest on your investments and if you continue to be consistent with putting money in each month the compound interest will do its magic and your money will work far harder then when tied up in a bank. See the question about interest on one million above to get a good idea of how compound interest can boost your savings.
Once you have started saving into stocks and shares and you are automating this on a weekly or monthly basis then it is time to move on to earn more money.
Try automating this saving with mobile apps such as Plum and Spendee. These apps are there to enable you to save your money and put it into stocks and shares ISA’s. You can see all of your incomings and outgoings in one place and they can save you time and money.
Earning More Money:
One of the key ways of how to make a million pound is to start investing early and for a long time. The next best thing is to earn more money. You might think you cannot earn enough to make One Million pound and you would probably be right but what you are going to do is earn more and invest that as well.
Just a small increase in your investment contributions can make a big difference as I will now show you with the calculator below.
Above is the amount of money you would end up with if you invested £200 per month for 20 years whilst gaining 8% interest. £114,532 more than half of that is compound interest!!
The above image is what happens when you increase the amount you can contribute by just £400 per month. This is the importance of a side-hustle or earning extra money. £400 extra per month which is easy to find when you know how could increase your investments by over £230,000 in 20 years. Who knows your side-hustles may even earn you more.
When it comes to earning more money there are numerous ways to do it. You just need a free afternoon and a notepad to start researching on the net how to do it. I am going to save you some trouble though and give you some great starting points.
Firstly anyone can earn extra money it is all about the right mindset. I am 46 years of age and have been blogging for 2 years. 2 years ago I knew nothing about blogging and now look at me.
Last week I started an Affiliate Marketing account on Twitter and have just made my first sale on social media. It is easy trust me you just need to dive in headfirst.
This is my go-to side-hustle as it can pay more than most. It has nothing to do with actual normal betting and losing money on your favourite football team it is about utilizing the bookmaker’s special offers to maximise profits.
The great thing with matched betting is that even if you have no idea what to do there is a website out there to help you. Profit Accumulator for a small monthly fee will walk you through it every step of the way. I made Over £300 in my first month alone and usually made around £700 per month with about 30 minutes per day and an hour or two at the weekends.
The guys over at Profit Accumulator really know what they are doing and you will treble your monthly fee in the first month guaranteed.
Click in below and see all the everyday people banking big profits. These can then be invested to make them grow more.
If you are still not sure then let the founder of Profit Accumulator explain things a little better than I can. Hit the video below.
Affiliate Marketing is one of the best ways to make extra money. If you are not sure what Affiliate Marketing is then have a read of my Passive income Article to learn more.
Essentially affiliate marketing is when you promote other peoples products. You get given a link by the maker of those products and then when you insert that link on your blog or Facebook page or Twitter etc and someone clicks on it and makes a purchase you will get a cut of the profits.
One bit of advice is to only affiliate with products you have used. It gives you the confidence to sell them as you are pleased with how good they are.
For example, the above post on Profit Accumulator contains my Affiliate link. If you click and sign up I get paid a small commission at no extra cost to you so we both win. Please note that I am a member of Profit Accumulator and genuinely have made thousands from their help.
Affiliate Marketing can be done anywhere you have your phone or laptop and can eventually be pretty much passive, earning you money while you sleep.
I have started on Twitter recently with Affiliate Marketing and made my first sale in less than a week See the details below.
Affiliate Grandmasters is a discord group I belong to that helps everyone make great money from Affiliate Marketing and you could too. If you want to get started making great money on Twitter to help you towards investing to One million pounds then click on the link to my Affiliate Marketing Page.
Now although blogging can take a while to start earning money, It does have the potential to outearn the two side-hustles I listed above. I have been blogging for around 2 years and make a small income but I work it around my full-time job.
Blogging is hard work and the learning curve is steep but it can be quite rewarding and there are many ways to earn money from blogging as well not just ads.
If you are passionate about a subject and can talk about it for hours then the chances are you can start a blog about it.
Pick your niche and go for it. Don’t procrastinate about the name or where to host your blog or which theme to pick. Just get it hosted and start writing.
I used Bluehost to host my blog as they gave me the best deal when I started and it can all be done for less than $4 a month.
Jump with Bluehost and get started blogging today, trust me you will not regret it. Be patient yet consistent and the earnings will follow.
For any tips on how to start a blog then check out my blogging guide here and learn how to set up your own blog.
A Look At How To Make A Million Pounds As An Average Person
As you can see how to make a million pounds really is just a case of saving more money, making more money, living below your means and investing everything that is spare.
Making more money is the big game changer and it is easy to do. Follow my guides above and you will see success. There are however some pearls of wisdom I would like you to take on board before you set out on your Wealth Journey.
- Poor people spend money they do not have to look wealthy (Think cars, Fashion, Holidays) Rich people look poor and keep their wealth private instead of flaunting it.
- Invest Invest Invest. People will say they cannot afford to invest because they could lose it all. They also say that while standing there wearing £200 jeans and holding a £5 cup of coffee.
- Consistency will always show in the amount of money you make from side-hustles
- Just because you have a net worth of One million pounds does not mean you can stop
- How to make a million pounds is a lot to do with your mindset
- Take action on whatever side hustle you want to do. Do not overthink it just get started
- The best time to invest was yesterday the second-best time is today. Take action
- Don’t work all day for someone else and come home too tired to work on your own goals
- How to make a million pounds? Get up early, take action, Make more money, Invest and occasionally take risks.
I hope you enjoyed learning how to make a million pounds. Some of you may not get there and that’s ok too as long as you take some important points away and that is to make more money for you and your family and to make that money work by investing it wisely.