Almost everybody dreams of becoming a millionaire at some point. Sadly, most of us will never achieve it.
But there is one way that almost everybody can makea million, provided they are patient.
You dont have to be a brilliant entrepreneur, lottery jackpot winner, lucky inheritor or buy-to-let baron.You can use something that is open to every UK resident: your tax-efficient individual savings account (ISA) allowance.
Get Rich Slowly
New research from Fidelity Personal Investing shows that if you invest your full ISAallowance every year, that million should ultimately beyours.
It wont happen overnight, however, butwill take on average 27 years and 10 months, Fidelity calculates.
Only novices think you can make a fast buck from the stock market. What it really does isbuild your wealth slowly, year after year, until eventually youre talking serious money.
The Nisa Way To Make A Million
Becoming an ISAmillionaire is easier following Chancellor George Osbornes move to increase the allowance to 15,000 a year from last July, in what was dubbed the New ISA, or Nisa.
This will rise in value every year, so in the next tax year you can invest up to 15,240 and shield your income and capital gains from the taxman.
Every UK adult has their own annual ISAallowance, which is issued on a use it or lose it basis, so dont let yours go to waste.
Time is running out to use this years allowance, which expires at midnight 5 April.
Cashing Out
Now, of course, most people cant afford to save 15,000 every year (and yes, Im one of them).
But even small amounts can grow into large sums, provided you leave it to grow in the stock market.
You can split your 15,000 allowance between a cash ISAand stocks and shares ISA, in whatever proportion you like.
But with the average cash ISApaying just 1.05%, there is almost zero chance of becoming a cash ISAmillionaire.
Fidelity calculates that if you had invested 15,000 in the average savings account 10 years ago, it would have grown to just 16,346 today.
But if you had invested that in the FTSE All Share Index instead, you would have 31,543, more than doubling your money.
The earlier you start investing, the better. Although stocks are more risky in the short run, they should deliver a positivereturn over five, 10 or 20 years.
Even if you dont make that million, you should still end up richer than if you never tried at all.
So where do you invest to make that million? To find out the answer, you need to read this FREE Motley Fool report 10 Steps To Making A Million In The Market.
This explains in a series ofsimple steps how investing in stocks and shares over the long term can make you rich.
It also sets outhow ordinary people can become astonishingly wealthy by investing in stocks and shares.
This report shows you how to do it, step-by-step. To find out more, click here now.
Get FREE Issues of The Motley Fool Collective
Get straightforward advice on whats really happening with the stock markets, direct to your inbox. Help yourself with our FREE email newsletter designed to help you protect and grow your portfolio wealth.
By providing your email address, you consent to receiving further information on our goods and services and those of our business partners. To opt-out of receiving this information click here. All information provided is governed by our Privacy Statement.