Learn How To Start Investing In Real Estate
Learn How To Start Investing In Real Estate

How To Make $1 Million Dollars: The 5 Best Ways In 2022

Written by Than Merrill

Earning a million dollars isn’t easy. While a million dollars might not be worth as much as it was a few years ago, it’s still a substantial sum of money. So, how do you earn that kind of cash?

Here, we’ll talk about several ways to earn your first million. We’ll also break down one of the most lucrative methods: real estate. The nice thing about real estate is that you don’t need special qualifications. As long as you have the money to buy a property, you can be a real estate investor. Keep reading to learn how to make a million dollars.

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The 5 Best Ways To Make $1 Million Dollars

So, how do you earn a million dollars? There are any number of methods. Here are the five most common ways to make your first $1 million dollars:

  1. Invest In Real Estate

  2. Start A Business

  3. Purchase Cheap Stocks

  4. Start A Side Hustle

  5. Protect Your Wealth

On the FortuneBuilders Real Estate Investing Show, host Jeff Rutkowski explains the many benefits of real estate investing and how to take advantage of its opportunities even in a post-COVID setting. Listen to the podcast here:

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1. Invest In Real Estate

If you rent your home, you’re not making the best use of your money. Yes, your rent money pays for a roof over your head, but that’s all it does. Your landlord still owns the property, even if you’ve paid rent on time every month for 30 years. Make your mortgage payment on time for 30 years, and you’ll actually own your house.

The most obvious benefit of owning your own home is that you’re no longer responsible for any monthly payments. All you have to pay for is taxes and maintenance. But a home is more than just a place you live; it’s also an investment. It’s no secret that real estate prices tend to go up over time. Buy a home for $300,000 today, and its value could easily rise to $400,000, $500,000, or more. This is hardly a guarantee; markets go down as well as up, and some regions can see depressed prices even while the national average goes up.

According to Ciuca Valeriu from   Currency-Convertor, another reason to invest in a home sooner rather than later is that your income should be going up over time. Over the course of your mortgage, your monthly payment will naturally take up a smaller and smaller percentage of your take-home pay.

Rising interest rates have been in the news lately, but they obscure a broader point. Even though they’re higher than they were a year ago, they’re still at historic lows. With rates set to go up over the next couple of years, there’s no better time than the present to lock in a low mortgage rate.

One last thing to note is that mortgage interest payments are tax-deductible, up to a limit of $1.1 million per year. Early in your mortgage, most of your monthly payment will go directly to interest. This means you can deduct the bulk of your housing costs from your taxes. As a renter, you still have to pay tax on your rent money.

2. Start A Business

Think of the most successful people in the country: Elon Musk, Jeff Bezos, Mark Zuckerberg, and Bill Gates. What do all of these people have in common? They all started a business!

Now, not everybody can start the next Amazon or Microsoft. That takes an incredible amount of luck, perfect timing, and if we’re being completely honest, it requires personal connections. The good news is that you don’t have to start a multi-billion-dollar corporation to find financial success. Small businesses are the backbone of the American economy, and millions of Americans have founded their own company. Even if you’re not making billions, making a million dollars or more is perfectly realistic.

To start a business, first think about what you’re good at. What do you have to offer other people? Maybe you’re a good cook who can create amazing recipes. Maybe you’re incredibly handy and want to start a contracting business. It will take grit and perseverance to get your business off the ground. But once you’re successful, the effort will be well worth your while.

3. Purchase Cheap Stocks

When stocks go down, it can seem like a bad time to buy. But actually, cheaper stocks can represent a better investment. Why? Because over time, the market tends to go up. If you have a well-diversified portfolio, those cheap stocks will eventually gain value, growing your investment.

Stay disciplined when you invest, and don’t panic over short-term losses. The market rewards dedicated investors who stick around for the long term. Besides, why would you want to sell your stocks when the market is down? That’s a great way to lose money.

Of course, price alone isn’t enough to tell you how a stock performs. Some stocks have a high per-share cost, but the company has a small market cap. Other stocks are cheaper per share, but the company has a higher market cap.

Instead, look for stocks that are undervalued. If those stocks are from newer companies, so much the better. Maybe you won’t find the next Google or Facebook. But if you’d invested $1,000 in Google when it went public, you’d have earned a 3,000% gain by now; in other words, you’d have $3 million worth of stock.

4. Start A Side Hustle

Stocks and other investments can provide a passive stream of income, but you need to have money to invest in the first place. So what do you do if you’re already spending most of your money on living expenses?

In that case, a second job can be a great idea. According to Anup Kayastha owner of, even a part-time gig, working a single shift per week, can be a great way to grow your income. Take all the money from that job and put it directly into investments, and you’ll have a sizeable nest egg in no time.

A side hustle doesn’t have to mean working for a corporation, either. There are plenty of solo gigs like dog walking, graphic design, and copywriting. You can even do something fun, like selling crafts and artwork on Etsy. Or, you could rent out your spare bedroom on a service like Airbnb. If you’re open-minded, there are plenty of ways to earn extra cash!

5. Protect Your Wealth

Strictly speaking, protecting your wealth isn’t going to earn you a dime. But if you’re not well-insured, a single illness or accident could wipe out all of your hard-earned gains.

One affordable option is an umbrella liability insurance policy. These policies protect your current assets and future income due to lawsuits. For example, let’s say you’re in a car accident that leaves the other driver paralyzed below the waist. You’re at fault for the accident, and that driver sues you for medical expenses and loss of income. A jury awards them $1,000,000 in damages, but your car insurance only provides $300,000 in liability coverage. This leaves you on the hook for the remaining $700,000. Say goodbye to your savings and investments!

If you had an umbrella liability policy, it would have picked up where the car insurance left off and covered the other $700,000. Different insurers have different rules, but most require you to have $300,000 in car insurance and home insurance liability coverage before you can purchase a policy. For around $150 to $200 per year, you can purchase $1 million in extra coverage. For another $75 to $100, you can up that amount to $2 million.

According to Brett Arrington from WeBuyGreensboroAreaHouses, it’s also important to think about health care costs. As you age, you’re likely to encounter medical expenses at some point. Most people will have to deal with cancer, diabetes, or another major disease during their lifetimes. It pays to have good health insurance. It can also help to take out a critical illness policy, which is supplemental insurance that kicks in when you have a major disease.

Long-term care is an even hairier problem. According to Vince Tint from 12SM, if you want to stay in a good nursing home, you can pay $100,000 a year or more, sometimes more than $200,000 in some areas. This kind of care can wipe out all your savings, so you end up leaving nothing to your heirs.

Long-term care insurance is expensive, but there are ways to keep your costs down. If you’re married, you can save a lot of money by investing in a shared-benefit policy for both spouses. It also helps to sign up earlier. These policies consider your age and overall physical fitness when you set your premiums. Sign up when you’re 50 years old and healthy, and the premiums can be quite reasonable. Sign up when you’re in your 60s or 70s, especially if you have a health condition, and your costs will be much higher.

How To Make A Million Dollars In Real Estate

Investing in real estate is a great way to increase your odds of making 1 million dollars. First, you can generate cash flow to scale your business. Second, real estate generally appreciates in value over time, save for a few exceptions. You can also intentionally add value to your properties by making updates and improvements.

If you want to make a million dollars, however, you’ll need a strategy. Below you’ll find the eight actionable steps you can implement to make a million in real estate:

  1. Learn About Real Estate Investing

  2. Establish Your Goals

  3. Start Now, But Start Small

  4. Write Offers For Affordable Deals

  5. Generate Cash Flow

  6. Start Growing Your Portfolio

  7. Invest In Larger Properties

  8. Continue Growing To 1 Million Dollars

1. Learn About Real Estate Investing

Before you do anything, the first step is conducting research and educating yourself about real estate investing. You’ll quickly learn that real estate is one of those rare industries in which successful investors are happy to share their techniques and advice. There are hundreds of blogs, websites, and podcasts dedicated to real estate investing and how to be successful at it.

It’s also a good idea to expose yourself to the anecdotes of seasoned investors. You’ll get a sense of the character traits required to succeed in the field. Real estate isn’t for everyone, as it requires persistence, patience, and grit. This will be your opportunity to decide whether or not real estate investing is a good fit before you get in too deep.

2. Establish Your Goals

Once you have some research under your belt and have confirmed that you want to move forward in real estate investing, it’s time to set some goals.

Goal-setting is used by virtually every entrepreneur, especially the successful ones. It can help you gain clarity on your vision and what milestones you need to meet to achieve that vision. Further, your goals can serve as guidelines to help you make sure your actions are aligned.

3. Start Now, But Start Small

When you gain clarity on your overarching vision, you may feel overwhelmed at first. Many individuals end up procrastinating because they feel so overwhelmed. Some might not even try.

The key to your eventual success is to get started and to get started now. It’s helpful to work backward and break up your goals into smaller, actionable steps. Even if you feel like that first step is small and insignificant, keep moving forward. Every action counts, and eventually, they will start to gain traction and give you the momentum you need. Whether it be something as simple as perusing the internet for deals or getting in your car to look for “for sale” signs, don’t wait.

4. Write Offers For Affordable Deals

The advice “start small” also applies to the kind of deals you should pursue at the very beginning. Don’t bite off more than you can chew by pursuing deals that cost more than you can afford.

Take a realistic look at your finances and figure out exactly what you can afford. If you’re just getting started, it’s likely a conservative amount.

Before you get discouraged, know that there are excellent deals to be had. What you need here is persistence. Keep making offers on deals you can afford, even if you get rejected the first few times. Eventually, someone will accept your offer. Don’t forget that it only takes one deal for you to break into the real estate investing business.

5. Generate Cash Flow

You should only submit offers for properties that will generate cash flow for your business. After all, you won’t get anywhere close to making a million dollars if you’re in the red.

Cash flow is the profit you make from rental income after paying all of your expenses. Common expenses include the mortgage, maintenance, repairs, and property management fees. Ideally, your rental income will pay for all your expenses and leave you with a profit margin.

6. Start Growing Your Portfolio

Aside from earning a profit, cash flow is the golden key to scaling your business. It might be tempting to spend your new income source, but now is the time to be diligent and save up. That’s because you can save up your rental income to put down toward a second rental property. This strategy is called the snowball method.

The goal is to eventually own multiple rental properties, including properties with multiple units. This is the fastest and surest way to secure enough income streams to make you a millionaire.

7. Invest In Larger Properties

Once you’ve added several residential properties to your portfolio, it’s time to level up. Many real estate investing experts will tell you that the most lucrative investments are commercial real estate and multifamily properties. Not only will they generate more income, but they will also appreciate at a fast rate.

There are two ways to do this: sell your current properties or leverage your equity. The nice thing about selling real estate is that you can avoid capital gains tax as long as you plan to buy real estate using the proceeds. (This guide dives into how a 1031 exchange works.)
According to Keith Terrell from  Backpacks Global, you can also leverage the equity you’ve built through your currently-owned properties. By refinancing them, you’ll receive some cash that you can then put down towards another property. Both of these strategies can be used repetitively throughout your career.

8. Continue Growing To 1 Million Dollars

Last but not least, don’t forget to keep growing. It will likely take a while to build momentum, and you are sure to make mistakes and run into difficulties. Even when someone succeeds in buying their first investment property, quite often, they’ll run into road bumps that discourage them altogether.

This is the point at which you need to push through and keep going. If you ever feel in doubt, pull out your list of goals from your goal-setting exercise to remind yourself of why you embarked on this journey in the first place. Every millionaire and billionaire has grown through their failures. Those who find success are those who keep their eyes on the prize.

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Tips For Making A Million Dollars In Real Estate

Embarking on a journey of real estate investing likely feels scary. Try to keep in mind that thousands of other real estate investors have paved the way for you, and you can learn invaluable lessons from their successes and failures. Here are some expert tips for making a million dollars in real estate:

  • Learn Before Making A New Investment

  • Make An Emergency Fund

  • Use Leverage For Investments

  • Build A Real Estate Team

Learn Before Making A New Investment

Real estate investing involves risk, but those who become successful have learned to take calculated risks. They also mitigate risk as much as possible.

According to John Burton from, if you’ve gained confidence in a certain market or investing niche, you may feel ready to expand into uncharted territories. Growth requires stepping out of your comfort zone, but at the same time, it’s important to limit yourself to informed, limited risks. Learn as much as you can about your new venture so that you can mitigate your risk.

Make An Emergency Fund

An essential step in calculating your first rental property deal is factoring in the cost of building up an emergency fund. As you earn your rental income, make sure you’re paying yourself by setting aside money in case emergencies arise.

Although you’ll have a routine amount of maintenance and repairs to pay for, an unexpected disaster could devastate your finances. For example, a collapsing roof or a cracked driveway could set you back an entire years’ worth of rental income. By setting up a safety net, you’ll be able to cover any unexpected expenses and stay on track with your finances.

Use Leverage For Investments

One of the main reasons why individuals never break into real estate is because it is capital-intensive. However, what they don’t know is that you can use leverage to finance your investments.

Whether you borrow a down payment from a relative or a hard money lender, there are plenty of ways to invest in real estate with no money. The key here is to make sure you’re earning enough rental income to pay back what you borrowed, pay down your mortgage, and earn a profit. The main benefit of using leverage is that it will help you buy more house than what you could have had you used your own money. In turn, this gets you access to higher returns.

Build A Real Estate Team

Last but not least, know that no man is an island in real estate. Nearly every successful real estate entrepreneur has a strong team behind them, and this includes your agent, broker, contractor, inspector, property manager, and attorney, to name a few.

Although building relationships with professionals will take time, having a team you trust will lower your costs over time. You’ll be able to call in expert help when needed, and because you have a strong relationship, costly mistakes caused by miscommunications and mistrust will be minimized.


Unless you’re incredibly lucky, you won’t earn a fortune overnight. Learning how to make a million dollars takes time, savvy investments, and a keen eye for business. Thankfully, you can leverage your money to earn more money by investing in real estate. Build a strong property portfolio, and you’ll be well on your way to your first million. But why stop there? Maintain your investment strategy, and the sky’s the limit.

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