Paul Merriman’s 12 One-Million Dollar Ideas for Investing Success

When it comes to building wealth and achieving financial independence, Paul Merriman has become a trusted voice in the world of personal finance and investing. On the Forget About Money podcast, Merriman shared his 12 One-Million Dollar Ideas—actionable strategies designed to help anyone, regardless of where they are in their financial journey, build a secure financial future.

Paul Merriman’s 12 One-Million Dollar Ideas come from his book titled We’re Talking Millions! 12 Simple Ways to Supercharge Your Retirement, which he co-authored with Richard Buck. The book breaks down easy-to-follow strategies that can have a massive impact on long-term financial success and retirement planning.

In this post, we’ll break down Paul Merriman’s 12 One-Million Dollar Ideas, explaining how each one can lead to long-term investment success. Whether you’re just getting started or fine-tuning your retirement plan, Merriman’s insights provide a blueprint for financial growth.

Paul Merriman’s 12 One-Million Dollar Ideas for Investing Success

1. Save vs. Spend: Prioritize Saving

One of Paul Merriman’s core messages is the importance of saving over spending. According to Merriman, too many people fall into the trap of prioritizing immediate gratification, which can delay financial independence.

“The system is designed to make you spend, not save. You have to arm-wrestle it to build wealth,” Paul Merriman explains. By automating savings and focusing on building wealth, rather than succumbing to lifestyle inflation, you can ensure that your financial future is secure.

2. Save Early vs. Waiting to Get Started

The earlier you start saving, the more time your investments have to grow through compound interest. In the podcast, Merriman underscores how small amounts saved early can have a huge impact over time.

“The earlier you start saving, the more your money will work for you through the power of compounding,” says Merriman. Starting early gives you a significant advantage in building wealth, even if the amounts seem small at first.

3. Stocks vs. Bonds: Balancing Risk and Reward

Balancing stocks and bonds is key to managing risk in your portfolio. Paul Merriman advises younger investors to focus heavily on stocks, while those nearing retirement should increase their bond holdings for stability.

Merriman highlights, “Stocks are where the growth is, but bonds provide the stability you’ll need later in life.” By maintaining a balanced portfolio, you can achieve long-term growth while managing short-term volatility.

4. One Stock vs. Many Stocks: The Importance of Diversification

Diversification is one of the key principles of Merriman’s investment philosophy. Investing in a single stock exposes you to unnecessary risk, while diversifying across many stocks spreads that risk and increases your chances of long-term success.

“Don’t put all your eggs in one basket. Diversification is your greatest defense,” Merriman explains. A well-diversified portfolio reduces risk and increases the likelihood of steady growth.

5. DIY vs. Professional Management: Index Funds Are Your Friend

Many investors wonder whether they should pick their own stocks or hire a professional manager. Merriman is a strong advocate for index funds as a low-cost, high-reward alternative to actively managed funds.

“Most people will never beat the market. If you can match the market, you’ll likely be in the top 10% of all investors,” Merriman says. Index funds allow investors to capture the market’s overall growth without the need to pick individual stocks or pay high management fees.

6. Actively Managed Funds vs. Index Funds

Index funds often outperform actively managed funds due to lower fees and consistent returns. Merriman believes that low-cost, passive investing is the key to long-term success.

“Index funds are a simple, effective way to build long-term wealth without the hassle of active management,” says Merriman. The simplicity of index funds makes them ideal for both new and experienced investors.

7. Add Large Cap Value to Your Portfolio

Merriman stresses the importance of adding large-cap value stocks to your portfolio. These stocks, typically representing well-established companies, provide stability and growth over time.

“Large-cap value stocks offer both stability and the potential for growth, which is critical for a balanced portfolio,” Merriman explains. These stocks form a solid foundation for long-term investing success.

8. Add Small Cap Blend Stocks for Growth

In addition to large-cap value stocks, Merriman recommends adding small-cap blend stocks to your portfolio for enhanced growth potential. These stocks provide a mix of growth and value characteristics.

“Small-cap stocks offer higher growth potential over the long run, which is why they’re important for investors looking for strong returns,” says Merriman. A mix of small and large-cap stocks provides a well-rounded portfolio.

9. Add Small Cap Value for Higher Returns

Merriman emphasizes the power of small-cap value stocks to drive higher returns. Historically, small-cap value stocks have outperformed many other asset classes over the long term.

“Small, consistent steps can have a huge impact over a lifetime of investing,” says Merriman. Small-cap value stocks are part of those steps, offering an opportunity for substantial growth.

10. Market Timing vs. Buy and Hold: Stick with Long-Term Investing

Market timing rarely works, and Merriman strongly advocates for a buy-and-hold strategy. Instead of trying to predict short-term market fluctuations, investors should stay the course for long-term gains.

“Market timing is incredibly difficult and risky. Buy and hold lets you capture the market’s long-term growth without the stress of short-term guessing,” Merriman explains.

11. Target Date Funds (TDF) vs. Selecting Asset Allocation Yourself

For those looking for a simple, hands-off investment approach, Merriman recommends target date funds (TDFs). These funds automatically adjust your asset allocation as you approach retirement, reducing risk over time.

“Target date funds offer an easy, automated way to invest for retirement without constantly managing your portfolio,” says Merriman. For investors who prefer simplicity, TDFs provide a balanced solution.

12. Roth IRA vs. Traditional IRA: Tax-Free Growth vs. Tax-Deferred Savings

When it comes to tax-efficient investing, Merriman favors the Roth IRA for its tax-free growth and flexibility. A Roth IRA allows you to contribute after-tax dollars and withdraw funds tax-free in retirement.

“The Roth IRA is a powerful tool for building wealth because it lets your money grow tax-free,” says Merriman. For many investors, the Roth IRA offers long-term benefits that a Traditional IRA cannot match.

Final Thoughts on Paul Merriman’s 12 One-Million Dollar Ideas

Paul Merriman’s 12 One-Million Dollar Ideas offer a comprehensive roadmap for achieving long-term investment success. Whether you’re starting your journey or refining your strategy, these ideas provide the building blocks for financial independence. By focusing on saving early, diversifying your portfolio, investing in index funds, and sticking with a buy-and-hold strategy, you can set yourself up for a secure financial future.

As Paul Merriman puts it, “Start saving today, no matter how small, because compound interest will turn that into millions.” These simple, actionable steps can lead to life-changing results over time.

By following these 12 ideas, you can align your financial goals with proven investment strategies that have stood the test of time.