When Will You Be a Millionaire?

Let’s say you’ve got your finances under control, you’re putting money away monthly, and you’re generally on a glide path towards a stress-free retirement.  Do you have any idea when you’ll hit your retirement target?

The Millionaire Math

Put away that slide-rule and that pen and paper – I’ve done the math for you.  Just plug in your monthly savings, expected inflation, expected return, your goal, and the amount you’ve got today and let Don’t Quit Your Day Job do the millionaire math (two million?) for you.

How to Be a Millionaire

If you play with this calculator for a while, you’ll notice that it points you down a familiar path – if you make many small, good decisions over a long enough period of time you’ll eventually reach your goal.  That much shouldn’t be surprising.

The surprising part?  When our friend Mochimac asked us if we had the capability to build this tool, she also asked if we could run other monthly savings amounts automatically.  You can see the results of that request.

Hit ‘calculate’ using the default numbers above and you’ll see something very interesting in the two results sections:

  • At $150 a month, you’ll reach $1,000,000 in this scenario in 43.25 years with 8% real returns (starting with $10,000).
  • $75 a month won’t take twice as long, and $300 a month won’t cut the time in half.

The Miracle of Compound Interest

Enter Compound Interest, stage left.  That’s right – at some point your money will be working much harder than your monthly contribution.

Even $300 a month in that scenario would take 36.93 years to grow a stash to $1,000,000 in today’s money.  If you did want to cut the time in half from the scenario with $150 a month?  Step up your game – you’re going to need around $1,400 a month, all else being equal.  You’re looking at what Albert Einstein (supposedly) called the greatest wonder in the universe.

Time Trump the Amount Saved Monthly

If you’ve got your monthly savings set, the math I showed you above probably depressed you a bit.  Even when you bring a lot more money to the table, the amount you save a month makes less of a difference in time-span than return.  While it takes a roughly $1,250 increase in savings to cut the time-to-millionaire in half in that scenario, you could also do it if you double your before-tax-and-inflation return to 20% annually.

The bad news?  It’s tough to get 20% returns!

If you followed our trailing return S&P 500 calculator, 0% of the samples in our dataset returned 20% a year for 20 years (pre or post inflation!).  In fact, only 30.32% single years in the S&P 500 beat that lofty goal.

That leaves us with time.  The longer you can leave your money invested, the better.  Your largest gains in net worth (well, and losses in some years) will come near the tail end of your investing horizon.  Why?  That’s when you’ve got the most assets at stake, blowing in the prevailing winds of the market.

How to Become a Millionaire

It’s simple, really.  If you want to become a millionaire, save money every month (or every paycheck), and leave the funds untouched for as long a period as possible.  No one can predict future returns for stocks and bonds, (although DQYDJ can show you the past returns of treasuries and the S&P 500) but we can tell you that 10% returns in the face of 2% inflation are relatively ambitious goals.

Do this for me: save regularly, check rarely, and celebrate wildly when you hit your retirement goal.


    • says

      Guilty as charged – although I have more programming talent than idea talent. If you have any ideas, toss them my way and I’ll let you know if they’re feasible.

        • says


          I saw the calculators you released from a post you made on the Wisebread message board. Very nice stuff, and all uniform to boot – my stuff is a motley crew of whatever form elements and css I felt like playing with at the time.

          For the most part, I’m trying to make a bunch of calculators that I haven’t seen before, or with elements incorporated I haven’t seen. Up next, perhaps, is a ridiculous study I’ve been doing on the CBO – certainly not something a PF blogger would normally talk about, heh.

  1. Jose says

    Nice! I have eleven years and I’ll hit my first million!The first think that crossed my mind when I saw this post was an old joke, (please forgive me) that to make a million dollars in the stock market you have to start with two million.

    • says

      Homework: done. Actually, I owe you one more piece, but I haven’t gotten around to that one.

      Definitely let me know if you have more ideas – unfortunately for me, my calculator ideas are getting more and more extreme. I’m sure there is still some low-hanging fruit before “Earnings Yields versus Ensuring S&P Performance” needs to be posted.

  2. says

    I love the calculator. That’s something I’ve done in Excel before, but having it embedded is great. I need to double my savings if I want to retire in 20 years.

    • says

      You’re looking at, pretty much, the formula for NPER if you set type to 0. I’m just happy to bring the real time graphing to your browser, haha.

  3. says

    This is beautiful. According to this, I am well on my way to hitting my goal of being financially independent by age 45. And I’ll probably hit my goal earlier since I only used my base salary in the calculator.

    Thanks for putting this together.

    • says

      Thanks for the note – the idea came from Mochimac (who already commented). I’m just the code jockey that tossed it together, heh.

      Make sure you play with the returns to make sure you aren’t over or underestimating!

      • says

        I’m probably underestimating since I only used my savings from my base salary. I didn’t include additional savings from bonuses, stock options, promotions, raises, or side income – All of which I’m working towards. And in the short term,savings rate matters a lot more than returns.

        • says

          Oh absolutely – big savings in the first years matter a lot (especially as you approach retirement). Pump in as much in as long as you can, heh.

  4. Shawn James says

    This calculator is amazing, Thanks! I have impressed with
    graph representation, it’s cool. Here my
    question about “How Much Money Are You Starting With?” here I am putting 10000,
    my Target Amount is 1000000 here calculator displaying results “savings goal in
    about 38.45 years. If you start today,
    we estimate you’ll reach $1,000,000.00 in today’s money in July of 2051.” That’s
    cool but starting investment type also effect on this rate or not because if I invest
    or save money as a fixed or variable format that condition this calculation fine
    or required to put different value to get exact result ..Please
    suggest to me.

    • says

      Shawn, I’m not quite sure what you’re asking. Is the question “what would happen if you didn’t save a fixed amount?”? The issue, of course, is I have no way of predicting what amount you will save monthly. Sure, you might save more in some months or less than others, but predicting the future for the totality of users of this calculator is difficult.

  5. Brick By Brick Investing says

    Great job on incorporating the calculator. If somehow we could only introduce compounding to our young generation I believe we would be much better off as a country. A lot of people think you need to come out of college and land a 6 figure job if you want to be rich! When in reality all you have to do is start investing early and live beneath your means. Obviously there is a little more to that, but that’s 75% of the work you need one right there.

    • says

      Even $150 a month over a long enough time period would put you in pretty good shape. Maybe not as good shape as implied by Dave Ramsey, but certainly better than if you didn’t invest.

      75%? Really, once your debt is gone, regular savings and investing is all you need. At its core, Personal Finance is incredibly boring. Do the same thing over and over, then retire rich.

  6. AvgJoeMoney says

    A fantastic discussion on compounding interest. Once people have the “a-ha” that your money can be a tax advantaged worker making money in your corner, then things start to roll. Sadly, as Marvin says, people get to that point WAY too late…..

  7. Pam@Pennysaverblog says

    Great calculator. Sobering, though, to realize how long it will take me to save what I would like to in my lifetime.

    • says

      I hear you – but note that the number one thing we control isn’t return, it’s ‘Time’. Just plug away at it for a very long time and you’ll eventually hit the goal.

      It wouldn’t be a goal if it was easy, right?