Financial Strategies to Become a Millionaire in Your 20s and 30s

If you're in your 20s or 30s and looking to be a millionaire before all of your friends who are just sticking their money in low-cost index funds, here are three things you could consider doing.

I'm Tyler, a former financial advisor and portfolio manager, and I now create financial content for free so that you don't have to pay for it.

1. Open a Roth IRA

Open up a Roth IRA through Fidelity and fund that account with 20 to 25 dollars a week. Don’t worry, if you ever need that money back, you can take back the contributions at any time, penalty and tax-free.

2. Invest Aggressively

Invest that 20 to 25 dollars into a more aggressive fund than one that tracks the S&P 500, such as Invesco's QQQ. This is a much more volatile but aggressive fund that tracks the 100 non-financial companies in the NASDAQ composite. It has returned over 14% annually for the last 30 years, compared to the S&P's 10%. This strategy can potentially yield a difference of almost $2 million over 30 years, even through significant downturns such as the housing crisis of 2008 and the global pandemic of 2020.

3. Tax-Free Withdrawals

Because you chose to invest in a Roth IRA instead of a brokerage account, every single penny of that $2.5 million is 100% tax-free after 59 and a half. Take the rest of the afternoon off and treat yourself to a celebratory beverage, because you've just set yourself on the path to potential wealth!

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