How to retire a millionaire

BUFFALO, N.Y. (WIVB) - Do you think becoming a millionaire is a distant dream? It's not as hard as you think and the key to achieving it, is right in your paycheck.

How do some people manage to retire with an extravagant house, a boat, a luxury car, and other high-end goodies while working a solid middle-class job the entirety of their working careers?

Schroeder, Braxton & Vogt Executive Vice President Richard Schroeder said, "I've seen a lot of average, middle-class people build up a million dollars, or close to a million dollars, by the time they retire."

If you want to be one of them, you'll need a lifetime of self-discipline.

Sgroi Financial President Patrick Sgroi said, "You have to roll up your sleeves, and you have to confront it. The biggest problem people have is they hear the number, that's a million dollars, they think it's too far out there to ever obtain, and then they just don't do it."

First, create and stick to a budget. You need to include all of your monthly expenses - mortgage, car payment, utilities, credit cards - and retirement savings.

"If you don't make it part of your budget, you'll never do it. So you have to make it part of [the] budget, and you have to fit it in," Sgroi said.

No matter how little you think you can spare, save something from every paycheck. Embrace the old adage - "pay yourself first."

Schroeder said, "Most employers have a 401K plan, or a simple IRA, or something to put money into. A lot of them match what you put in there, so that doubles your savings. So the first thing I tell anyone is, put all that you can in your employer plan."

Sgroi added, "The people that think it's insignificant don't start. And they never start. You need to start, regardless of the amount."

If you don't have a company plan, look into an IRA - an individual retirement account. And lose the excuses. Stop saying, 'I can't save!' just because you're not a stock-market wiz, or because you're trying hard to get out of the hole.

You need to put money away, even if you're young, early on in your career, and think paying off debt is more important.

"Do both. Both pay the debt down early, and put money away," Schroeder encouraged.

If you want to retire a millionaire, you must get out of debt, and stay out. Follow whatever strategy keeps you feeling the most motivated. Because if you feel good about yourself, you're more likely to keep going until you're debt-free.

Sgroi noted, "I'll go interest rate and principal balance in a combination. So if they're close, then you go highest interest rate one first. If there's a gap, sometimes I'll choose the lower balance one just to get it out of the way."

"Obviously, paying off the highest interest rate debt is the most practical solution. But just getting rid of something quickly really makes you feel good," Schroeder added.

How much do you have to save to get to a million, if you're starting from zero right now? Let's assume you retire at 65, and live to be 90.

If you're 25, you've got to sock away a little over $2,000 a month; 35, close to $3,000; 45, over $4,000; and 55 - well, you've got some big-time catching up to do.

>> How long will it take you to become a millionaire based on your current age? You can find out using this online calculator!

Bottom line?

"It is easy to get discouraged," Schroeder said. "You just have to tell yourself, 'Well, if I didn't do this, I'd be in worse shape. So I've got to at least try something. I've got to try to do it.'"