Kevin O’Leary claims his simple formula is all you need to turn yourself into a millionaire — even on a $65,000 salary

You’re making $65,000 a year and wondering if you’ll ever see seven figures in your bank account. According to “Shark Tank” investor Kevin O’Leary, not only is it possible – it’s practically guaranteed if you follow his simple formula.

Contents

Don’t miss O’Leary: Save first, spend later Balancing present needs with future wealth Time is your biggest asset The power of cutting unnecessary spending What to read next

O’Leary recently shared his wealth-building philosophy on X, delivering the same advice he gave his own children: save, invest, and let compound interest work its magic. His approach strips away intimidating complexity and focuses on three core principles that anyone can follow, regardless of their income level.

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But is it really that simple?

O’Leary: Save first, spend later

The foundation of O’Leary’s strategy revolves around one non-negotiable rule: save before you spend. “Don’t spend it. Save it. Invest it. Let it compound,” he emphasized in his recent video message.

Why does O’Leary prioritize saving over spending? The answer lies in the power of compound interest and market growth. He points to historical market returns of 8% to 10% annually, which means your money grows exponentially over time. Every dollar you invest today becomes significantly more valuable decades down the road.

O’Leary’s magic number is 15%. “Take 15% of every paycheck, I don’t care how big it is. Or any gift Granny gives you. Or anything you get in a side hustle, and invest it,” he advises. This consistent percentage applies to all income sources, ensuring that your wealth-building efforts accelerate as your earning power increases.

Balancing present needs with future wealth

Setting aside 15% of your income might seem daunting, especially when you’re juggling rent, groceries, and other essential expenses. The key is viewing this percentage not as optional spending money, but as a non-negotiable bill you pay to your future self.

Start by creating a budget that prioritizes your 15% investment contribution right after essential expenses like housing, food, transportation, and minimum debt payments. Consider this your “wealth tax” — a mandatory payment that builds wealth rather than depleting it.

If 15% feels impossible initially, begin with whatever percentage you can manage consistently. Even 5% or 10% creates momentum and establishes the habit. You can increase the percentage as you eliminate debt, receive raises, or find ways to reduce other expenses.

Here’s a relatively painless way to start: Contribute just enough to get your company’s full 401(k) match — something nearly a quarter of 401(k) investors don’t do, investment house Vanguard found in a 2024 study. Many employers offer a dollar-for-dollar match on the first 3% of your salary — meaning you put in 3%, they put in 3%, and boom: You’re saving 6% of your income for retirement.

From there, take 1% from your next raise, or more, and add it to your contribution. Do the same with each raise that follows until you’re putting away 15%. You’ll barely notice the difference in your paycheck, but your future self will thank you for the slow, steady climb.

Read more: Want an extra $1,300,000 when you retire? Dave Ramsey says this 7-step plan ‘works every single time’ to kill debt, get rich in America — and that ‘anyone’ can do it

Time is your biggest asset

The earlier you start investing, the more dramatic your results become. This is where compound interest truly shines, turning modest contributions into substantial wealth over decades.

Consider Sarah, who starts investing 15% of her $65,000 salary at age 25. She contributes $9,750 annually ($812.50 monthly) to diversified index funds earning an average 9% return. By age 65, her investments will have grown to approximately $3.3 million — despite contributing only $390,000 of her own money over 40 years.

Compare that to Michael, who waits until age 35 to start the same investment strategy. His final balance at 65 would be around $1.5 million, despite contributing $292,500. Sarah’s 10-year head start resulted in $1.8 million more, even though she only contributed $97,500 more of her own money.

This dramatic difference explains why O’Leary emphasizes starting immediately, regardless of age or income level. Time multiplies money in ways that higher salaries alone can’t match.

The power of cutting unnecessary spending

O’Leary’s wealth-building philosophy includes one crucial caveat: “Just don’t buy crap you don’t need.” He’s particularly vocal about small daily expenses that seem insignificant but add up to substantial amounts over time.

But you don’t have to live like a hermit. The goal is distinguishing between purchases that genuinely enhance your life and those that provide momentary satisfaction. Create a “want versus need” filter for discretionary spending. Ask yourself: Will this purchase matter to me in five years, or will investing this money instead set me up for financial freedom?