How to become a millionaire (my favorite case study)

How to become a millionaire (my favorite case study)

Becoming a millionaire is actually not that difficult.

Hint, you typically won’t become a millionaire by doing the following…

  • Day trading
  • Buying penny stocks
  • Putting all your savings in crypto
  • Joining a pyramid scheme
  • Taking investing advice from your friend (who joined Robinhood last week)
  • Buying lottery tickets
  • Going to the casino
  • Reading self-help books and telling yourself “I’ll manifest riches into my life”

The tried and true way of becoming a millionaire requires a few traits which we can all possess. Those traits include:

  • Discipline
  • Patience
  • Emotional control

Here is a story from CNBC on a janitor with all 3 traits who was able to build up a portfolio of $8M dollars.

The big question is, how does a janitor become a multi-millionaire?

Introducing… Ronald Reed

  • Ronald Reed was the first in his family to graduate from high school.
  • Thereafter he served in the military during World War II, specifically in North Africa, Italy, and the Pacific.
  • After the war, he came home to work at a gas station and as a janitor at JCPenney.
  • He also got married and raised two children.
  • He maintained a frugal lifestyle. Friends remember him driving a second-hand Toyota Yaris, using safety pins to hold his coat together, and cutting his own firewood well into his 90s.

His secret to his success:

  • Discipline – Buy individual stocks with every paycheck. At Tykr, we recommend investing 15% – 30% of every paycheck. If you can’t invest 15% or more, that’s okay. Start small and work your way up.
  • Patience – Set your sights on the long-term. Don’t expect to get rich overnight. If you can invest 15% – 30% of every paycheck and do that for over 10 years, compound interest will do a lot of hard work for you.
  • Emotional control – When the market goes down, don’t sell. This is a big mistake beginner investors make. Over the last 100 years, we’ve had about 19 bear markets that have each lasted about 9 months. This tells us the market goes up a lot more than it goes down. And when it does go down, it doesn’t last long. The trick is to keep buying more when the market goes down. We talk about that a lot at Tykr.

Stocks that Ronald Reed owned:

  • Procter & Gamble
  • J.P. Morgan Chase
  • General Electric
  • Dow Chemical
  • J.M. Smucker
  • CVS Health
  • Johnson & Johnson

In summary, buying individual stocks is the key!

If you want to find good stocks like Ronald Reed did, we suggest you join Tykr. Start here with a free trial.