If i invest $100 a month will i be a millionaire?
I guess the most important part of the equation is how long I will be investing $100 a month.
I did a search on Google for a compounding interest calculator (because each year my earnings will be determined by how much I have saved and how much interest my savings had earned the previous years).
The compounding interest calculator gives me the following results if I start with no money and invest $100 a month at a 8% interest rate:
20 years - $4,942.29
30 years - $12,234.59
40 years - $27,978.10
50 years - $61,967.18
60 years - $135,347.04
70 years - $293,768.65
80 years - $635,789.03
90 years - $1,374,185.37
So it would take a long time to be a millionaire if you only invested $100 per month.
Let's try a chart with a $400 monthly investment at the same 8% interest rate:
20 years - $19,769.17
30 years - $48,938.35
40 years - $111,912.42
50 years - $247,868.71
60 years - $541,388.14
70 years - $1,175,074.59
80 years - $2,543,156.11
90 years - $5,496,741.48
So I think the lesson of these charts is to start investing as early as possible because the benefits of compounding interest really pay off the longer your money is invested.
If the goal is to reach a million dollars by investing a certain amount each month, just find a compounding interest calculator and run some numbers to set a goal for yourself. (note: this exercise is a lot more encouraging to younger members of the investing community.)
Most importantly, set up monthly automatic withdrawals as soon as possible so your monthly investment will be invested before you have a chance to do something else with the money.
You will live on what comes into your bank account as you always do, but now you also will be investing money each month into your goal of reaching a million dollars.
Good luck and get started.