20 January 2019
Right education and an early start are key for success in today’s business and professional environment. Photo: Bloomberg
Right education and an early start are key for success in today’s business and professional environment. Photo: Bloomberg

How to make a million before you turn 33

There are at least 56,000 Hongkongers who have liquid assets of HK$10 million or more, according to a survey from Citibank and the University of Hong Kong’s Social Sciences Research Centre.

The multimillionaires are 58 years in age on average, and most had earned their first million by the time they were 33.

The data suggests that in order to become a multimillionaire, it is important to become a millionaire before turning 33.

But the question is: how?

Given the average age of the current crop of multimillionaires and the indicated period when they made their first million, we can take go back and take a look at 1989.

Back then, Heng Fa Chuen, a large residential estate in the northeast of Hong Kong Island, had been just built.

And a flat measuring 500 square feet — which now costs nearly HK$7 million — cost around HK$1 million at that time.

Thus, one should have been able to pay for the flat in full before turning 33 in order to turn into a multimillionaire now.

And given the normal assumptions about when a person would start his working life, it means that the person would have had just about 10 years to make the first million. 

Now, one might be skeptical and think that many of the millionaires must have inherited their wealth from ancestors.

But, is the argument really valid?

In 2012, Fidelity conducted a similar survey in the US. Their survey showed that US citizens with U$1 million investable assets average around 61 years in age, and they also made their first fortune in their 30s. Among them, 86 percent were self-made.

It’s reasonable to assume that US millionaires are older than their peers in Hong Kong, which is a relatively less mature economy.

Now, given the fact that Hong Kong’s economy started taking off in a big way only in the 1980s, one would have to accept that most of our multimillionaires are self-made rather than being born with silver spoons in their mouths.

There are only two ways to get rich, either through professional knowledge or by investment. You have to start early no matter which path you choose.

To become a doctor, lawyer or other professional, you have to get the perfect education and obtain the necessary licenses.

It’s the same with investment. As Warren Buffet once noted, compound interest and time will make a complete difference in creating wealth.

In fact, character might be the single most critical element to succeed.

Confucius once said: “A youth is to be regarded with respect. How do we know that his future will not be equal to our present? If he reach the age of forty or fifty, and has not made himself heard of, then indeed he will not be worth being regarded with respect.”

If you haven’t achieved anything by the time you are 40 or 50, you should begin to worry.

This article appeared in the Hong Kong Economic Journal on March 25.

Translation by Julie Zhu

[Chinese version中文版]

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Hong Kong Economic Journal columnist

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