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Spring 2024  Volume 16, Number 2        

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8 Top Tips from Millionaires for Growing Your Retirement Nest Egg

When it comes to saving and investing for retirement, millionaires tend to do things a bit differently than the average American. With their substantial net worth and investing savvy, they employ unique strategies to continually build their wealth over time. By modeling some of their habits, you can put your retirement savings efforts on the fast track.

1. Research Shows Millionaires Have a Different Financial Mindset

According to a 2022 survey by financial services firm Ameriprise Financial, 60% of millionaires consider themselves upper middle class, while 31% identify as middle class. This demonstrates that today’s millionaires have a much different perception of wealth compared to decades past. Additionally, they tend to be more focused on preserving assets versus increasing income.

The Ameriprise survey polled 580 Americans aged 27 to 77 with over $1 million in investable assets. It found millionaires’ top financial priorities include:

  • Safeguarding assets
  • Retirement savings
  • Minimizing market risk

Meanwhile, those with under $1 million in the bank were more worried about:

  • Retirement savings
  • Daily spending
  • Raising income
  • Debt payoff

This demonstrates millionaires take a long-term outlook and emphasize securing funds for later years.

2. Embrace a Future-Oriented Focus

Millionaires understand that the key to building wealth means consistently investing over long periods of time. While the average American may make retirement savings a priority only when and if daily expenses have been met, millionaires know that consistent contributions to investment accounts, when compounded, can grow exponentially.

One financial expert notes that because millionaires have what he describes as a “philosophical” outlook, they envision the future in decades rather than days. They understand that progress often takes indirect paths and circuitous routes.

This future-forward way of thinking allows millionaires to stay invested through market ups and downs. Taking such a patient, long-term view can reinforce your own retirement commitment.

3. Start Investing Early and Stick with It

Arranging automated transfers from your paycheck emulates the millionaire’s discipline of consistent investing. One specialist surveyed recommends committing to investments for at least 10 years to enjoy meaningful gains, as that’s approximately how long it takes for growth to gain momentum and accelerate. While the first decade might be challenging, this time period is also the most important to achieve success.

So be sure you steadily fund retirement accounts like 401(k) plans and IRAs. With time, you’re likely to enjoy substantial gains.

4. Spread Resources Across Asset Classes

Millionaires also know that diversifying investments across different asset classes helps reduce portfolio risk while allowing continued growth. Rather than putting all their eggs in one basket, they spread capital among:

  • Stocks
  • Bonds
  • Commodities
  • Real estate

A properly diversified portfolio performs well when some assets zig while others zag. Having a balanced mix means you won’t see quite as extreme highs, but it also protects you from drastic lows.

5. Leverage Financial Experts

Enlisting guidance from a professional financial advisor allows millionaires to develop specialized investment and retirement strategies. An advisor helps you diversify your holdings, keep focused on long-term goals, and adjust your asset allocation as you get closer to retirement.

Experts explain millionaires tend to be more cautious in terms of their financial decisions. Having an advisor gives them experienced perspective on how to continue accumulating wealth while also preserving assets.

6. Spend Less Than You Earn

Building wealth and saving for retirement requires consistently spending less than you earn. By creating a budget and sticking to it, you can identify areas to cut back on so you have more available capital to invest each month.

One specialist suggests documenting your financial goals and then budgeting to support them, regardless of your current wealth status. So don’t overspend just to appear wealthy—instead use those extra funds to grow your nest egg.

7. Plan for Sizeable Future Costs

In addition to budgeting for monthly expenses, take a page from millionaires and anticipate high future costs like college, new cars or homes, elder care, and so on. Knowing these are coming down the pike allows you to proactively save for them. By doing so, you won’t risk derailing retirement contributions later when these big expenses arise.

8. Stay Focused on the Big Picture

Having patience and persistence with investing leads to the best outcomes. But life often throws unexpected crises and obstacles at us. Millionaires plan for these contingencies so they don’t panic and pull money from investments at the wrong time when markets are down.

One advisor emphasizes focusing on elements within your control while bracing for external shocks. Building an emergency fund alongside your retirement savings helps ensure you don’t have to tap investment accounts unnecessarily.

Please call us for help and more information.

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In this issue:

This Just In... 3 Medigap Surprises to Watch Out For

8 Top Tips from Millionaires for Growing Your Retirement Nest Egg

What Is First-to-Die Life Insurance and Do You Need It?

How to Pick the Best Health Plan at Work

Important Retirement Trends to Keep an Eye On




The information presented and conclusions within are based upon our best judgment and analysis. It is not guaranteed information and does not necessarily reflect all available data. Web addresses are current at time of publication but subject to change. SmartsPro Marketing and The Insurance 411 do not engage in the solicitation, sale or management of securities or investments, nor does it make any recommendations on securities or investments. This material may not be quoted or reproduced in any form without publisher’s permission. All rights reserved. ©2023 The Insurance 411. www.theinsurance411.com Tel. 877-762-7877.