Fulfilling your dream of becoming a millionaire is not easy, but if you are smart and start contributing right away, it’s possible to transform your savings into a retirement jackpot. In this article, we’ll give you some valuable tips to get started by presenting you with the top seven ways to turn your 401(k) into a million dollars.
1) Invest in Mutual Funds
The more return you get, the quicker (and larger) your 401(k) is going to grow. But in order to achieve the largest possible gain, you are going to have to consider investments that deliver a higher return than most fixed income investments. According to a survey of 401(k) millionaires conducted by Fidelity, those who were successful at reaching the one-million mark invested an average of 75% of their savings in company stocks and stock mutual funds. On average, it paid off, leading to a return of 4.8% of their 401(k) over the twelve year period the study was conducted. While making large investments in stocks is a game of risk and reward that isn’t always the best solution for every financial situation, diversifying your savings into stocks that pay higher dividends has a proven track record of boosting 401(k)s into seven digit status. A little evaluation of your own situation followed by some calculated investments is a great way to set your 401(k) on this same track.
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