It’s easy to assume that wealth and income are deeply intertwined. After all, how does anyone become wealthy without a high-income stream?
However, data gathered by Dave Ramsey’s team suggests the link between wealth and income may be weaker than most people assume.
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According to The National Study of Millionaires, conducted by Ramsey Solutions, only 31% of American millionaires earned an average annual income of $100,000 over the course of their careers. Perhaps even more surprising is that one-third of these millionaires never reached the six-figure income milestone throughout their careers.
In other words, it’s completely realistic to reach a seven-figure net worth without earning a six-figure salary. However, this modest income path to millionaire status does require more effort and discipline.
Expenses are the key
The key to accumulating wealth is managing expenses. Many ultra-high-income individuals struggle to break into the millionaires club because they let lifestyle inflation consume them.
In fact, 36% of Americans earning more than $200,000 a year said they were living paycheck to paycheck, according to a PYMNTS survey from 2024.
By comparison, someone with a modest five-figure income coupled with better savings and investing skills could be more likely to reach millionaire status. However, a high-savings rate isn’t a silver bullet. To break into the millionaires club with a mid-range income, you’ll need to invest wisely and start as early as you can.
Start investing early
The magic fuel that drives the compounding growth effect is time. In a long enough time frame, even modest savings and lacklustre investment returns can turn into serious wealth.
For instance, an 18-year-old would need to save only $250 a month and earn a modest 7% annual return on investment to reach $1 million by the age of 66. Put simply, if you want to accumulate exceptional wealth without an exceptional income, starting as early as possible is essential.
Read more: Want an extra $1,300,000 when you retire? Dave Ramsey says this 7-step plan ‘works every single time’ to kill debt, get rich in America — and that ‘anyone’ can do it
Avoid or limit debt
Another essential ingredient in your modest-income-to-millionaire journey is reducing your exposure to debt. After all, a high-interest loan can effectively offset all the positive impacts of a diligent savings and investing strategy.
For most people, avoiding debt — especially the expensive type — is their biggest challenge. As of early 2025, American households collectively had nearly $5 trillion in non-housing debt such as student loans, auto loans and credit card balances, according to the New York Federal Reserve.
Serving this debt could be one of the key reasons why the average personal savings rate in America is only 4.9%, according to the Federal Reserve Bank of St. Louis.
By limiting or eliminating consumer debt, you can save more. That could be the key to your financial freedom, regardless of your income.
Creative planning
Life can be messy and even if you follow all the traditional financial advice, your journey to financial freedom could be derailed by health issues, divorce, bankruptcy or emergencies.
If you’re approaching retirement without much savings or a high-paying career, your chances of becoming a millionaire are greatly diminished. However, this doesn’t mean it’s impossible to enter the club.
Creative solutions could help you get there despite the odds. For instance, you could boost your savings rate by temporarily moving to a town or country with a lower cost of living. Working remotely while paying modest rent in Mexico, for example, could help you accumulate wealth faster.
You could also consider delaying retirement. Adding five or even 10 years to your retirement plan could make a significant difference, especially if you’re starting to build your nest egg later in life. A 40-year-old would need to save just $900 a month and earn a 7% return on investment to reach millionaire status at 75.
Finally, you could boost your investment returns by investing in alternative assets such as rental property, farmland, small businesses or high-growth tech stocks.
There’s always a practical path to the seven-figure club, regardless of your age or income.
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This article provides information only and should not be construed as advice. It is provided without warranty of any kind.
