How Long It Takes To Be A Millionaire With Stocks (2024)

Many investors are piling into stocks — including in the S&P 500 — hoping to turn into millionaires. And while stocks are millionaire makers, your wait to get there varies.

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There's no question learning how to identify the top stocks, like Leaderboard member Tesla (TSLA) and Enphase Energy (ENPH) is your fastest ticket to a million. It can happen in a year. But striking a top theme, too, can make you a millionaire in two to four years. If you're playing sectors, and pick the right one, it can take nine years to hit a million bucks.

What about It'll get you to a million, but you'll need to be patient. If you're a typical buy-and-hold S&P 500 investor, it's been a nearly 12 year wait to get there.

Opportunities abound in stocks. But some investors need to reset expectations of how long it takes to gain wealth, says Jack Ablin, chief investment officer at Cresset Investment Management.

"Speculators hope to get rich quick, while investors need to stay focused on matching investments with the appropriate investment time horizons," he said. "Moreover, we would view short bouts of selling as longer-term buying opportunities."

What You Need To Hit A Million

The time it'll take to be a millionaire mostly hinges on what you start with. And that's a personal number.

But the typical investor account is now sitting at around $200,000. That's based on the $6.69 trillion in assets held across 33.2 million investor accounts at Charles Schwab at the end of 2020. Incidentally, that's very close to the average $262,000 held in Schwab accounts at the end of 2019. You'd need a 400% gain to turn a $200,000 beginning balance into $1 million.

And many of these investors are turning to stocks to get them there. Nearly half, 48%, of Schwab accountholders are bullish on the stock market. That's the measure's highest reading since 2013. And it's up from 36% in the fourth quarter of 2020. Meanwhile, more than half, 54%, say it's a good time to invest.

And yet, how long does it take to hit a million?

One-Year Millionaire: Pick Top S&P 500 Stocks

If you or someone you know turned into a millionaire in a year, there's little question how they did it with stocks. Finding the top stocks, including larger ones in the S&P 500, is the way to do it.

Certainly, picking consumer discretionary play Tesla was a real millionaire maker. It's the top-performing S&P 500 over the past 12 months, says an Investor's Business Daily analysis of data from S&P Global Market Intelligence and MarketSmith. It's up 423%, turning $200,000 a year ago into more than $1 million. Should you buy Tesla stock now?

Interestingly, though, it's not the only S&P 500 stock to do it. Lesser known solar-equipment play Enphase Energy pulled it off, too. The stock is up 406% over the past 12 month, also enough to turn the typical investor into a millionaire.

Millionaire In Two To Four Years: Hot Themes

Picking hot themes, usually those under-the-radar of the S&P 500, is another way investors are chasing their seven-digit wealth dreams. Themes are understandable and investible trends, such as alternative energy or cloud computing.

Nearly $10 billion in net new assets has poured into thematic ETFs in 2021 so far, says State Street Global Advisors. And it's easy to see why.

If you're in the right theme, you don't have to pick the perfect stock. And you fast-track your race to a million. It's not just a theory. Look at Invesco WilderHill Clean Energy ETF (PBW). Had you simply called the rise of clean energy, you'd be up 414% over the past two years. That's enough to turn $200,000 into $1 million.

Such hits are rare, but not unheard of. If you'd simply bet on breakthroughs, and bought the Ark Innovation ETF (ARKK), you'd be a millionaire in four years. The Ark Innovation ETF is up 573% in four years, enough to turn $200,000 into $1.3 million in that time.

$1 Million In Nine Years: Sector Bets

Don't need to hit the right stock to be a millionaire in a decade, but you want to hit the right index at least. S&P 500 sector bets help you narrow down your aim.

Hitting the 400% bogey to a million is possible with sectors. And they've trimmed the wait from just owning the S&P 500. The top-performing sector is technology, which won't surprise many investors. The Technology Select Sector SPDR (XLK) is up 391% in nine years and 411% in 10 years.

But you could have hit a million slightly faster by broadening slightly. The tech-heavy Invesco QQQ Trust (QQQ) rose 391% in just eight years and 434% in nine. What should you know about the QQQ?

12-Year Millionaire: S&P 500 Plays A Role, Too

How long did it take $200,000 invested in the S&P 500 to be worth $1 million now? Roughly 12 years. Had you put your portfolio in the SPDR S&P 500 ETF Trust (SPY) on March 20, 2009, you'd be sitting on shares worth a million dollars now. Keep in mind, that's only the portfolio value, not including the quarterly dividends.

And there's merit to the S&P 500, as it's difficult to know which sectors will play out the best. And diversification is prudent. Plunking down all $200,000 on one stock calls for great care and risk taking. But if you do choose right, your wait to a million is dramatically reduced.

Who wants to wait 12 years to be a millionaire?

Top S&P 500 Stocks The Past 12 Months

Just two turned $200,000 into $1 million that fast

Sources: IBD, S&P Global Market Intelligence

Follow Matt Krantz on Twitter@mattkrantz