Who wants to be a millionaire? I do!

Who wants to be a millionaire? It’s hard to believe but almost 25 years have passed since quizmaster Chris Tarrant first posed that question on the hit TV show.

Millions of people tuned in every week to watch the contestants attempt to correctly answer 15 questions with the help of three lifelines: Phone a friend; 50-50; and ask the audience.

But while everyone appearing on the programme dreamed of walking away with the top prize, only a relative handful succeeded.

Past winners

The first person to navigate their way to the jackpot was Judith Keppel in 2000 – just two years after the show made its UK debut.

The most notorious, meanwhile, was Major Charles Ingram who cheated his way to victory the following year with the help of a coughing accomplice in the audience. The Major and his wife, Diana, were given 18-month prison sentences, suspended for two years, while accomplice Tecwen Whittock received a 12-month sentence, again suspended for two years.

Investment success

Of course, answering questions on a television show – or cheating the system – isn’t the only way of securing a seven-figure sum that can make your financial future more comfortable.

It can also be achieved by investing – if you put away enough money, choose the right asset classes, and give yourself plenty of time.

Many people have joined the exclusive Millionaires’ Club over the years after buying into investment funds that have delivered bumper returns to clients.

ISA millionaires club

There are even 2,000 millionaires through their Individual Savings Accounts, according to Freedom of Information (FOI) requests made to HMRC by InvestingReviews.co.uk.

The website discovered these investors’ lucrative ISA holdings were worth an average of £1,412,000, while 60 investors have pots with more than £3m.

It claimed investors starting today could expect to reach the coveted seven figure mark in 22 years by maxing out their £20,000 annual allowance and assuming a compounded 7% annual return.

How to hit a million

Of course, investing certainly isn’t a guaranteed route to riches. The stock market can be an extremely volatile place and the value of your investments can go down as well as up.

The good news, however, is that there’s plenty you can do to improve your chances of success and limit the potential downside – if you do your research.

According to our calculations, it’s possible to become a millionaire in just 17 years. Using the current individual £20,000 ISA allowance as a starting base, and assuming the annual capital growth is 5% after charges, a couple could see their ISA pot reach £949,299 in 16 years and £1,033,614 in 17 years*.

With the same assumptions, an individual investing their full ISA allowance could see their investment reach £1,022,269 within 26 years*.

So, where do you begin?

You can start with this guide covering how to start your journey towards Millionaire’s Row – and the pitfalls to avoid along the way.

Start putting money away

This is the most important factor. Almost everyone wishes they had started saving earlier in life as this gives your money more time to grow.

The compound effect of interest – or dividends – on your savings can also help enlarge the pot. This can help speed up your journey to seven figures.

Having a longer investment horizon will also give you the freedom to take more risk with your money in the hope of generating higher returns.

Save as much as you can

It’s always hard to find money to save when we have so many things we need to spend our wages on.

However, you may be able to cut some costs – and put the money you’ve saved towards bolstering your investments and building for the future.

A great idea is to set up a direct debit straight from your current account into your savings accounts or investments each month, so the money is accumulating without you even realising.

Another idea is to immediately increase your savings by the same percentage as any pay rises. What you haven’t had previously, you won’t miss.

Understand what type of investor you are

Your potential to hit seven figures will also depend on your attitude to risk – and your willingness to cope with stock market volatility.

Increasing your chances of enjoying bumper returns may require you to have exposure to more volatile assets, such as emerging market equities.

The problem with investments – particularly those linked to the stock market – is that the value of your holdings can fall as well as rise. You need to be prepared for such eventualities.

Research your options

The key to successful investing is carrying out thorough research. There is certainly no shortage of investment funds, so you need to know everything before committing your money.

That’s where FundCalibre can help. Each of our Elite Rated funds has an individual note, explaining everything you need to know about it as an investment.

Research FundCalibre’s Elite rated funds here.

It’s important to understand not just how a fund has performed, but also why it has done well or badly, and whether that is likely to change.

That’s why it’s important to spend time researching the fund managers at the helm of these portfolios and getting an idea of their track records.

You also need to understand the risks taken by the fund manager, the way they select stocks, how they build portfolios, and whether they make regular changes.

How our Elite Rated funds can get you to a million

The annual rate of return you achieve on your investments after charges will make an enormous difference to how quickly you achieve your goal.

There are several Elite Rated funds that have been in existence for two decades, which is close to the time that the TV programme first aired.

If you had been able to invest £20,000 a year for 20 years, 10 Elite-rated funds which have had the same manager for the past two decades, would have achieved the desired result**.

If you had invested a much smaller sum of money – £10,000 a year for 20 years – three of these funds would have turned you into a millionaire**.

Elite Rated funds that could have made you a million**

Elite Rated fund£10,000 invested annually for 20 years**£20,000 invested annually for 20 years**
Liontrust UK Smaller Companies£1,140,107£2,280,214
AXA Framlington American Growth£1,082,046£2,164,093
TB Amati UK Smaller Companies£1,039,181£2, 078,362
European Opportunities Trust£858,998£1, 717,995
JP Morgan Emerging Markets Investment Trust£829,418£1,658,835
Schroder Asian Income£738,789£1,477,578
Liontrust Sustainable Future Global Growth£683,721£1,367,442
Waverton European Capital Growth£635,259£1,270,518
Jupiter Merlin Growth Portfolio£600,101£1,200,202
City of London Investment Trust£542,259£1,084,518

This article was originally published 6 September 2018 and updated on 8 June 2022. 

*Source: thecalculatorsite.com
**Source: FE fundinfo, total returns in sterling, over 20 years to 29th April 2022

This article is provided for information only. The views of the author and any people quoted are their own and do not constitute financial advice. The content is not intended to be a personal recommendation to buy or sell any fund or trust, or to adopt a particular investment strategy. However, the knowledge that professional analysts have analysed a fund or trust in depth before assigning them a rating can be a valuable additional filter for anyone looking to make their own decisions. Past performance is not a reliable guide to future returns. Market and exchange-rate movements may cause the value of investments to go down as well as up. Yields will fluctuate and so income from investments is variable and not guaranteed. You may not get back the amount originally invested. Tax treatment depends of your individual circumstances and may be subject to change in the future. If you are unsure about the suitability of any investment you should seek professional advice. Whilst FundCalibre provides product information, guidance and fund research we cannot know which of these products or funds, if any, are suitable for your particular circumstances and must leave that judgement to you. Before you make any investment decision, make sure you’re comfortable and fully understand the risks. Further information can be found on Elite Rated funds by simply clicking on the name highlighted in the article.