Millionaire Enquirer

Millionaire Enquirer

It may surprise you how quickly you can accumulate a million naira. Let’s help you determine the annual (and monthly) amount you would have to set aside in investments to reach a million naira and reach your goal to be a millionaire.

Millionaire at 20?

Dear Enquirer,

I will be 16 years old in a few weeks; is it too early to be thinking of becoming a millionaire? If not, how much do I need to commit to savings and investment regularly to become a millionaire at 20? I have N20,000 in investment currently. Thank you.

Joy.

Dear Joy,
Based on your existing investment of N20,000, it appears that you will need to save and invest an additional N194,950 annually (or about N16,246 monthly), if we assume a 10 per cent compounded returns, in order to become a millionaire by age 20 .

However, note that a million naira today will not be worth the same in 4 years. One million naira adjusted for inflation of 10% will be N1,331,000 in 4 years. You will need to save and invest N261,353 annually (or N21,779 monthly) to reach that goal by age 20. Please see the table below for a calculation of these figures.

Age

Beginning Balance

Savings @ 0.0%

Earnings

Taxes @ 10.0%

Ending Balance

16

N20,000

N194,950

N21,495

N2,149

N234,295

17

234,295

194,950

42,925

4,292

467,877

18

467,877

194,950

66,283

6,628

722,481

19

722,481

194,950

91,743

9,174

1,000,000