Question for the Money Doctors
Question submitted on Mar 2, 2012.
QuestionIf I make 180,000 a year how can I save 1 mil in 6 years? Is this possble? I understand I would need to save about 13,888 if I go with no interest.
Hi - If you invested $10,900 per month for the next 6 years and received an annual return of at least 10.83%, you could accumulate a $1M before inflation and taxes.
But consider this: $10,900 is almost 100% of your take-home pay after taxes. Are you willing and able to invest 100% of your take home pay for the next 6 years? Also, in this volatile market, an investment making 10.83% per year would be very risky and it is possible that your investment would be less than you put into it at the end of the 6th year.
Alternatively, if you save $8,200 per month and invest it in a less risky investment that makes 4.43% per year, you could meet your savings goals, as well.
Keep all of these things in mind when looking to save a cool million! Good luck.
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