HOW TO BECOME A MILLIONAIRE IN THE NEXT 10 YEARS

Does it seem like becoming a millionaire is an unattainable dream? Perhaps it is not. Leigh Gallagher from SmartMoney magazine shares a strategy which if employed can make you a millionaire in just 10 years. Find out her recommendations here!

CBS News highlights…

Leigh Gallagher, senior editor at SmartMoney magazine, visited The Early Show Thursday and said, with the right strategies, many families can boost their savings to seven figures in 10 years. She gave co-anchor Harry Smith a roadmap to success.

Health
What it’s worth: $84,000

“Most people don’t really think about the links from your health to your wealth. But it has a surprising effect,” Gallagher said. “If you have good health habits, you eat well, you don’t smoke, you’re not overweight, obviously, you’ll have lower medical bills. Besides that, studies have shown that people that maintain those habits actually earn more over a long period of time.”

Spending
What it’s worth: $50,000

Gallagher says the average American household spends about $75,000 each year, which includes everything from housing to mocchacino. The first place to try cutting back is with your mortgage.

“If you just adjust your mortgage, get an adjustable rate mortgage for a few years, lower your percentage point by 1 percentage point, that over 10 years will save you about $22,000,” she said.

Another place to cut spending is on your cars. “A lot of people these days like to lease new cars,” said Gallagher. “If you just substitute a pair of used cars every five years for leased cars you’ll save, over 10 years, around $31,000.”

Saving
What it’s worth: $535,000

“You need to maximize your 401k,” said Gallagher. “That’s the best weapon at anyone’s disposal by far. If you put away 15 percent of your salary, we looked at a couple making a combined income of $120,000. Fifteen percent, over 10 years, before any investment gains, can add up to $397,000.”

Investing
What it’s worth: $478,000

The next question is how to invest this savings. Gallagher suggests putting the bulk of it, 80 to 90 percent, into mutual funds that track stock market indexes, and investing the rest more aggressively.

Career
What it’s worth: $171,000

Gallagher suggests working hard to double the amount of your annual raises, which might mean pushing yourself harder on the job. “It means going above and beyond,” she told Smith. “You can’t just do your job. You have to do your job times two. But if you do that and double your raise, that’s a very big deal.

Picking lottery numbers
Avoid 3, 7, 19

If you’re still convinced that the road to riches is through the lottery, you might as well do it right. Gallagher suggests avoiding the “lucky numbers,” three and seven, and avoiding 19, which occurs in every adult’s birthday.

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