A couple of my next big financial goals that I hope to achieve are to get to $40,000 in dividends by 2024 and to get a $2,000,000 net worth by 2024 as well. I feel pretty good about getting to the $40,000 in dividends, but haven’t given much thought about the possibility of hitting $2million in the next few years.
I originally became a millionaire back on October 4th of 2017. I remember that date, because it was the day before my 38th birthday. For the most part, that was a great year and pretty much everything seemed to be going great for me. I set a goal to try to double that net worth by 2024 based on a simple rule of 72. Basically over six years, I need to average 12% return per year to double my money. Now that I am a few years in and about $750K away from my goal, I wanted to check in and see if it’s still possible to reach this goal.
Sitting down with a financial calculator (HP12C is my financial calculator of choice) and keying in a few data points I quickly see that my monthly rate of return needed to hit my goal is 0.986% per month, basically still on track to hit my goal to get to $2,000,000 in the next 4 years.
The key strokes needed to calculate the required rate of return are:
N=4gN (4 years x 12 months=48 months)
Solve for I (rate of return per month
Result 0.986% per month
Here is what everything looks like plotted out in excel and graphically:
While the $750k that I need to make seems like a really big number to get in the next 4 years, when we break it down to some basic financial math, we see that the goal is achievable.
Some things that will make the results vary. We know that the markets don’t have a predictability of a simple math calculation. What I mean, is that the stock market is highly unlikely to return me the about 1% per month for the next 48 months. That would be too easy. There will be months I lose 5%, make 5%. What I’m hoping for is that an all stock portfolio will continue to be a leading asset class for returns.
The economy has also been super strong for a really long time. I have not had a negative return since 2008. I highly expect at some point in the future to experience another negative return. It just has to happen.
I won’t be mad if I fall short of my goal. If I finish at say $1.8million, I’m happy. I’d be a 44 year old, almost multi-millionaire. My goal is to get as close to my goal of hitting $2million or more. Basically for getting near my goal, I plan on treating myself to a new car to replace my currently 17 year old car, which will be 20 years old in 2023. I think the new Toyota Supra looks pretty fun 🙂
Remember to set your goals, work towards the goal, and track your progress to the goal. Pretty simple.Follow me on the social medias: