Nearly 22 million Americans, or about one in 15 people, have a net worth greater than $1 million. according to the UBS Global Wealth Report 2024.

For those looking to get into this club quickly, multi-millionaire and “Shark Tank” alum Kevin O’Leary has some advice.

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“The quickest way to make a million dollars is to make the first $10,000,” he said in a statement. video posted on his YouTube channel. “That’s really how it works. But in reality, it’s about nothing more than focusing on what people want and how to solve their problems.

In other words, his advice to anyone looking to build wealth quickly is to start a business. “Successful businesses solve people’s problems and (customers) want to pay because it saves them time and money…people don’t want to walk around barefoot, so they buy shoes .”

He added: “Try to find a problem that you know everyone has, and then provide a product or service that solves that problem. »

Here’s why working for yourself may be the solution the fastest way to get into the seven-figure club, but it’s not necessarily the best path.

Fast track

O’Leary’s comments about making the first $10,000 and solving a “problem” involve starting a business and making it profitable. Over time, a profitable business could grow and generate wealth for its owner.

Indeed, headlines are often dominated by the sudden successes of innovative entrepreneurs.

Artificial intelligence search engine maker Perplexity AI launched in 2022 and is already valued at $3 billion as of June, according to CNBC. This created a huge boon for the company’s founder, Aravind Srinivas.

However, you don’t need a revolutionary business idea to make a fortune. According to a study According to JPMorgan Chase, 8.9% of small businesses manage to grow their revenue to $1 million within the first five years of their existence.

Of course, this is not the experience of the majority of small business owners; However, this statistic suggests that there is some truth to O’Leary’s belief that it is a quick path to millionaire status. That being said, it does not indicate how likely – or even risk – this path is.

An estimated one in four new businesses fail within their first year of business, according to LendingTree. data analysis from the U.S. Bureau of Labor Statistics (BLS). Additionally, 48% of businesses fail within their first five years.

In other words: if you start a business today, you’ll have an 8.9% chance of growing it to $1 million in revenue by 2029, but a 48% chance of failing by during the same period.

The risk of failure is significantly higher. With that in mind, most people would be better off choosing a slower, but less risky, path to millionaire status.

Learn more: 5 Ways to Increase Your Net Worth Now Easily increase your gambling without altering your daily life

Slow track

Your chances of accumulating $1 million could be higher if you simply find a well-paying job, save a significant amount of money each month, and invest it wisely. At least that’s what the Ramsey Solutions National Millionaires Study reveals.

According to the investigation75% of millionaires said regular, consistent investing over an extended period of time is the main reason for their success.

The most common professions that resulted in millionaire status were teachers, accountants, lawyers, managers, and engineers. Only 31% earned an average of $100,000 per year during their career. Instead, most of their success is due to wise investments.

In 2023, the median annual salary for a lawyer in the United States was $145,760, according to the BLS. data.

Save just 15% of that and invest it in a low-cost index fund, like Vanguard. S&P500 fund – and using, as an example, a compound annual growth rate of 13.33% – could help you accumulate just over $1 million in 16 years.

Granted, 16 years is a long time, so it’s definitely not a quick way to get into the seven-figure club. But your chances of successfully achieving this goal are probably much higher than starting a small business, making it profitable, and growing it.

If you’re looking to build wealth, both paths are completely valid. You can choose either path depending on your risk appetite, patience level and business aptitude.

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This article provides information only and should not be considered advice. It is provided without warranty of any kind.