Want to Retire as a Millionaire? Here's How Much You'll Need to Invest Each Month.

Retiring with $1 million or more may be a lofty goal, but it’s more attainable than you might think. Even when the market is volatile, it’s still possible to start preparing for the future. Saving for retirement is a long-term strategy, and short-term turbulence shouldn’t stop you from investing right now.

Just how much you’ll have to invest each month will depend on a variety of factors. Here’s everything you need to know about retiring as a millionaire.

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What does it take to retire with $1 million?

First, your investment portfolio will affect the types of returns you’re earning. The S&P 500 has historically earned an average return of around 10% per year, which means the annual returns have averaged out to around 10% per year over decades. S&P 500 ETFs and other market-tracking index funds will likely see similar returns.

If you’re investing in individual stocks, your returns will vary depending on exactly which stocks you own. Also, if you’re investing heavily in bonds or other conservative investments, you’ll likely see lower returns over time than you would with stocks.

How much should you invest each month?

The other two factors that will impact your earnings are the amount you’re investing per month and the number of years you give your money to grow.

To accumulate a significant amount in savings, you can either invest a lot per month for fewer years or invest less per month but give your money several decades to build. If you have a specific retirement age in mind, that will give you an idea of how much longer you’ll need to invest.

For simplicity’s sake, let’s say your investments are earning an average rate of return of 10% per year, in line with the market’s historic performance. Here’s approximately how much you’d need to invest per month to reach $1 million, depending on how many years you have until retirement:

Number of Years Amount Invested per Month Total Savings
40 $200 $1.062 million
35 $325 $1.057 million
30 $525 $1.036 million
25 $850 $1.003 million
20 $1,500 $1.031 million
15 $2,700 $1.029 million
10 $5,500 $1.052 million

Source: Author’s calculations via Investor.gov.

The longer you wait to begin saving, the more you’ll need to invest each month. But if you start early, you could retire a millionaire with just a few hundred dollars per month.

Giving your savings a boost

Two of the simplest ways to increase your total savings include investing more per month or giving your money more time to grow. But if those aren’t possible, you can also revisit your investment portfolio.

To be clear, there are no safe ways to make a lot of money overnight, but the right stocks can help maximize your earnings.

It’s still important to consider your risk tolerance when choosing stocks, especially as you get closer to retirement. But by investing in solid companies with healthy underlying business fundamentals, you’re more likely to earn above-average returns over time while still minimizing your risk.

Investing in the stock market can be daunting, especially during periods of volatility. But it’s one of the most effective ways to build long-term wealth. With the right strategy, you’ll be on your way to retiring as a millionaire.