Do You Have $5,000? You Can Turn That Into $1 Million.

The belief that you have to have money to make money is a bit of a fallacy. Sure, you have to have some money, but you don't have to have $50,000 to invest and get a great return. In fact, if you have just $5,000 and are patient, you can turn that initial investment into nearly $1 million over time.

Legendary investor Ron Baron told CNBC recently that the secret to getting rich is to have a small amount of money, invest it regularly, and live a long life. Baron is the founder of Baron Capital, which manages nearly $26 billion in assets.

Baron is famous for his in depth research and for buying stock in what he feels are undervalued companies. He then keeps the stock in those companies for around 14 years. He has the advantage of a $2.2 billion net worth with which to invest, of course. However, you really don't have to have that much money.

Take $5,000 a year and invest it in an index fund for 30 years and VOILA! You will have $890,000 at the end of those 30 years. If you, like so many people, never really thought you'd get old and put off savings, you can net $110,000 over 10 years using that same strategy and $250,000 over 20 years.

Baron believes that long term investing yields the best results due to the link between the economy and the stock market.

Last summer, Baron believed that the Dow Jones will hit 40,000 by 2030. Now, he thinks that prediction is a bit low. The Dow closed at 23,387 on November 16^th.