How Did This Family Make Their Money?

The best way to build your savings is to start early. Doing so allows you take advantage of the power of compounding over the years. Say you're 20 years old. If you contribute $6,000 to an individual retirement account (IRA) every year ($500 a month) for 40 years, your total investment would be $240,000. But because of the power of compounding, your nest egg would be worth much more. Assuming a 7% return, it would total more than $1.37 million. You'd be a millionaire by age 57, just by saving $500 a month. Granted, you'd rather be a millionaire by age 30. There's more to do.