Most Australians dream of gaining that millionaire status.
But all too often, they fall into the trap of assuming it's too difficult, or downright impossible – what with all the utility bills and mortgage repayments that get in the way, not to mention the expensive family holidays and children's education.
But in reality, it is possible – even with all those expenses.
In fact, according to the latest Global Wealth Report from Credit Suisse, Australia is home to 961 thousand millionaires.
What's more, this was measured as adults with wealth above US $1 million. In Australian dollars, the true figure is likely significantly higher than the 961 thousand reported.
Sure, some of these millionaires sit in high-rise offices overlooking the harbour, while others would spend most of their time relaxing on their private yacht or on the golf course.
But I'd be willing to wager that the vast majority are just like you and me.
Instead of inheriting significant family fortunes, I'd suggest that most of them have saved hard. They've lived below their means, been sensible about not taking on too much debt and they've stuck to their budgets.
If that's you, congratulations!
If it's not, it's never too late to start.
Grow your wealth the lazy way
I'd guess many of these millionaires have likely built their wealth on the local sharemarket — buying, holding, and re-investing dividends into companies like Woolworths Limited (ASX: WOW) and Commonwealth Bank of Australia(ASX: CBA).
But first, not every person enjoys success on the share market.
I can recall at one barbeque I went to last year, a person overheard that I worked for The Motley Fool Australia.
Impressed by the bull market the ASX was enjoying at the time, he asked me for the name of a company I thought was set to double in price – preferably within the next week or two.
Now, long-time readers know that is not how The Motley Fool encourages you to invest in the share market.
From memory, he left me standing by the esky as he walked away nonchalantly when I told him that successful investing was achieved over a period of years and decades, not days or weeks.
Sure, you might get lucky, occasionally, but I hope for that person's sake my message got through loud and clear. Shooting for quick wins punting on highly speculative shares is a mug's game, and one that often ends in pain and misfortune.
Admittedly, the idea of finding market-smashing ideas like 1-Page Ltd (ASX: 1PG) before it soared 2,175% is certainly appetising.
But in reality, the vast majority of wealth generated on the share market is made over the long-term – mostly by sitting on your hands and doing absolutely nothing.
Just ask Warren Buffett, chairman of Berkshire Hathaway, who has openly stated his favourite holding period is "forever".
Peter Lynch and Charlie Munger (Buffett's right-hand man) are the same.
They earned their fame and fortunes not by trying to time the market, but by being lazy and holding onto their shares for the long-run, letting the power of compounding work its magic.
Picking the right companies
In order to succeed, patience is a must. Composure and self-control are also essential, especially when the markets do get choppy, just as they have done in recent months.
Of course, it's also extremely important to pick the right companies in your investing journey, and that's where Scott Phillips comes in.
Scott leads our Motley Fool Share Advisor service, and that service's share recommendations are handsomely outperforming the All Ordinaries (ASX: XAO) since the time of inception.
Some have doubled or tripled, while others have gained more than 500% since their time of recommendation!
Take Integrated Research Limited (ASX: IRI), for example.
Members were first introduced to this virtually unknown ASX software company in December 2011, and it has since skyrocketed almost 570% in the time since.
To put that in perspective, let's say you'd followed our advice and invested $10,000 at the time. Your shares would now be worth nearly $67,000, or a profit of almost $57,000!
Sure, there may come a time to sell your shares — perhaps when the market is offering you a price you simply can't refuse, or when the thesis behind your investment changes so much that you're no longer comfortable holding on.
But selling for the sake of 'locking in' a profit on an otherwise sound investment won't get you far.
Thankfully, Scott advised members to stick with Integrated Research through thick and thin, to keep holding, and keep believing in the power of compounding returns.
In other words, the best course of action to take on Integrated Research was to do nothing (other than buying, of course).
It might seem lazy, but that's often the greatest way to make money on the share market, and how many of those 961 thousand millionaires have likely made their fortune, over time.
