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8 Habits of Self-Made Millionaires

8 Habits of Self-Made Millionaires

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Most millionaires weren’t born with a silver spoon in their mouth. A whopping 86% were self-made, according to a 2012 survey by Fidelity Investments.

A raft of books and studies delve into what makes the nation’s affluent tick. A survey yields these prosaic and often surprising habits of the most wealthy.

Make a budget and stick to it

Sounds boring, but self-made millionaires yawn their way to the bank by diligently attending to the ebb and flow of their bank accounts, authors Thomas Stanley and William Danko write in “The Millionaire Next Door,” their landmark study of the traits shared by America’s most wealthy.  That habit doesn’t end when the number of zeros in their ledger lengthens.

Pay yourself first

Self-made millionaires don’t see money as something to spend, but as tools for savings or investment. A trick that everyone could emulate – come rain or shine, put at least 10% of what you earn into your savings account. Just like credit card spending can slowly rise into an ocean of debt, the reverse is true with methodical saving.

It helps to start young. As financial author Dave Ramsey notes: “Saving only $100 per month from age 25 to age 65 at 12% growth = $1,176,000. Everyone should retire a millionaire!”

The rich just do this better: The average millionaire saves or invests 20% of their income. Many experts suggest the 50-30-20 rule – spend 50% of your income for what you need (housing, auto), 30% for what you want (new clothes) and invest or save the remaining 20%.

Have a goal

Wealthy people are list-makers – 81% of millionaires maintain a diligent to-do list, compared with just 9% of poor people (defined as people earning $30,000 or less a year), according to authorThomas Corley’s research on the daily habits of the very rich. And the goals set a path of action. Corley describes one man who set a goal of adding $150,000 to his income but fell short. When he added the daily goal of making 10 more marketing calls a day “he blew past $150,000 to $300,000. The stuff wealthy people told me about goal setting really works.”

“They set these huge goals,” says Steve Siebold, author of “How Rich People Think.” “Guys like (Richard) Branson set these outrageous goals and they achieve it, so they do it again. Before they make their first $1 million, they may not believe they can make it. But once they overcome that hurdle, it seems to get easier.” Branson, a British billionaire, is the founder of the Virgin Group.

Live below your means

Most self-made millionaires play the game that got them there – even when they can afford to buy more. Legendary investor Warren Buffett famously lives in the same house in Omaha, Neb., he bought for $31,500 in 1958 before he made his billions. Most of America’s millionaires buy used cars, according to Stanley and Danko. The most popular brand? Toyota.

Conspicuous consumption is not a common trait for most of America’s wealthy. “It is seldom luck or inheritance or advanced degrees or even intelligence that enables people to amass fortunes,” they write in “The Millionaire Next Door.” “Wealth is more often the result of a lifestyle of hard work, perseverance, planning, and, most of all, self discipline.”

Work for yourself

Only about 20% of Americans own their own business, but two-thirds of U.S. millionaires are entrepreneurs. Worldwide, about half the world’s millionaires own their own businesses, according to the Economist; a scant 16% inherited their cash.

“The really rich never depend on one flow of income but instead create a number of revenue streams,” writes Grant Cardone, author of “The 10X Rule.”

Be comfortable living with uncertainty

Wealthy people become rich through sensible risk-taking and resilience. “A lot of life is based on uncertainty. The quality of life is the amount of uncertainty you can comfortably live with,” Anthony Robbins told me after I covered one of his “Unleash the Power Within” seminars a decade ago. “A greater quality of life—faith, life experience, always comes around, have more flexibility. You never know what’s going to happen.”

Hang out with millionaires

Robbins is a big advocate that if you want to become successful in business, you should spend time with people who are successful at business. Just as musicians hang out with fellow musicians and authors gravitate to other writers, the wealthy wannabe’s spend time with the wealthy. Not just to schmooze (although they do that, too – 79% of self-made millionaires spend five-plus hours a month networking, compared to just 3% of people making $30,000 or less a year).

Moreover, they genuinely want to learn from others to emulate their success. “You can’t learn how to make money from someone who doesn’t have much,” said Cardone. “You need to know what people are doing to create wealth and follow their example: What do they read? How do they invest? What drives them? How do they stay motivated and excited?”

Money is a by-product, not the goal

The wealthy don’t get rich by desiring things, but by striving for more intangible gains. The money follows. “For the rich, it’s not about getting more stuff. It’s about having the freedom to make almost any decision you want,” says T. Harv Eker, author of “Secrets of the Millionaire Mind.”

Loving what you do matters. “Oftentimes passion for a career is not love at first sight,” Stanley writes in his book, “The Millionaire Mind.” Just over half of millionaires he surveyed enjoyed their career at the start; but over 80% said caring about their vocation is what ultimately built their wealth.

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