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8 Traits That Make People Millionaires

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Becoming a millionaire may not be easy, but it is possible. I share some of the most common traits of millionaires and what you can do to join the club.

The following is a contribution from Donny at PersonalIncome.org. If you’d like to contribute to Frugal Rules, please contact us.

 

Not everyone is cut out to be a millionaire, but the number of millionaires in the U.S. is at an all-time high of 9.63 million households in 2013, according to a report from Spectrum Group. While it may seem daunting for the average person to reach millionaire status, it actually only requires two main things – time and good habits.

Do you have what it takes to be a millionaire? Here we’re looking at eight traits commonly seen among the worlds’ wealthiest individuals.

8 Mindsets Employed by Millionaires

 

They invest their money. Millionaires know that just saving their money isn’t going to get them to millionaire status. Saving doesn’t earn you any money and it doesn’t even keep up with inflation. Investing in the stock market allows your money to make you more money, which coupled with time and compounding interest, is one of the best ways to become a millionaire. If you’re not sure where to start investing, here’s a list of the 10 best companies to invest in 2015 to get you started.

They aren’t looking to keep up with the Joneses. Simply put, millionaires live below their means. They drive older cars, live in modest houses, cook food at home and carefully monitor their spending. Millionaires are good with their money and each purchase is carefully thought out.

They’re diversified. Millionaires don’t normally invest in one particular stock or bond, but rather hold a diversified portfolio. Legg Mason, an investment allocation firm, found that millionaires’ portfolios consist of cash, equities, bonds, real estate and non-traditional investments.

They’re willing to take risks. Whether it’s by investing in a risky asset or quitting their job and starting their own company, millionaires are willing to take risks. They follow their passions, are extremely focused and aren’t afraid to fail. They view failures as lessons and move forward instead of feeling defeated.

They work towards their goals every day. Sure, millionaires relax and have downtime, but they keep their end goals in mind and carry them with them all the time. Every decision they make takes into account their goal of being a millionaire. They stick towards their budget and have clearly defined goals when it comes to their finances.

They’re self-employed. While not all millionaires are self-employed, studies show that many are. Various reports indicate many millionaires own their own business namely with Nerd Wallet stating that 66 percent of millionaires in the U.S. are entrepreneurs.

They surround themselves with other millionaires. You are the average of the five people you hang out with, famously said by motivational speaker Jim Rohn. We are influenced by our surroundings, so find a group of individuals who challenge your thinking, live below their means and always have their eyes on the prize and you’re likely to become like them.

They’re go getters. Millionaires start their days before the sun comes up, are constantly on the lookout for new opportunities and follow their dreams. One way the average person can become a go getter is by eliminating distractions. Quit wasting time on social media and watching mindless television. Instead, formulate a plan to work for yourself and earn more money.

Becoming a millionaire may not be easy, but it is possible. I share some of the most common traits of millionaires and what you can do to join the club.

Most millionaires are average people who you would never guess have a net worth of one million or more. They don’t “flaunt” their money, but instead work hard, invest their money consistently and track their spending. By being focused on earning more money, taking advantage of opportunities that come your way and living below your means, you can increase your chances of becoming a millionaire.

 

What “millionaire” traits do you have or struggle with? What do you struggle with more – working to earn more or be mindful about your spending? What is one trait you think others give up on simply because they think it takes too much work?

 

Donny Gamble Jr. is founder of Personalincome.org, a published author, and investor. He graduated from The Ohio State University and has a passion for teaching others about alternative investment and retirement strategies. He is a contributor for Huffington Post & AllBusiness.com, along with other personal finance websites.

 

 

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I'm the founder of Frugal Rules, a Dad, husband and veteran of the financial services industry. I'm passionate about helping people learn from my mistakes so that they can enjoy the freedom that comes from living frugally. I'm also a freelance writer, and regularly contribute to GoBankingRates, Investopedia, Lending Tree and more. If you're wanting to learn how to monetize your blog, check out my blog coaching services to see how I can help you take your site to the next level.

22 Comments

  • A lot of reality TV has brain-washed us into thinking that millionaires drive around fancy cars, go clothes shopping daily, and take luxurious vacations all of the time. In reality you would never know a millionaire if they were living next door to you because most “hide” it well. Like you said, they drive older cars and live in modest houses.

    • Donny Gamble says:

      I totally agree. The media definitely creates their own interpretation of how millionaires live. It was a study done that 61% of people who earn $250,000 or more aren’t buying luxury cars at all.

  • Great post, Donny! The thing that I always think about when it comes to millionaires is that you rarely catch them sitting on their duffs watching TV. They’re always working and/or learning.

  • It’s good to know I’m on the right track at least. I think I just need a little patience 🙂

  • Last week, my hubs called me and told me that it’s very nice that he is surrounded by a rich and business minded people BUT still they are very simple. He was even surprised even if how rich, they are, they even prefer to cook food at home rather than going to an expensive restaurant if they don’t have an important meeting.

    • Donny Gamble says:

      Clarisse,

      It is definitely a huge misconception that people make about rich people going out to expensive restaurants everyday. They would rather spend time eating at home with their families.

  • It’s fun to see that I can tick off most of the boxes on this list. That said… I still need a few more years to hit millionaire status, but it’s on the horizon!

  • Like what Anne said, I’m glad to know I have many of the traits that would make a millionaire. yay! Not there yet, but sticking with the belief in myself that it’s possible. The only thing I have’t done well in a couple years is investing.

    • Donny Gamble says:

      Tonya,

      Investing is definitely an area that you want to consider as it is a way to create more positive monthly cash flow, just make sure you educate yourself first before diving into the investing world.

  • Ben Luthi says:

    One of my favorite books is The Millionaire Next Door. Getting there is a lot less flashy than most people think. Lots of hard work and smart money management. Thanks for sharing!

  • I’m actually really surprised that 66% of millionaires are entrepreneurs. It’s really not that difficult to become a millionaire as an employee. You don’t have to make $1M a year or even $250k like some executives. If you consistently save and invest it’s actually pretty easy (imo) to slowly reach millionaire status.

    Okay I just went to the post you linked to and it said “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.”

    I still find it to be way higher than I’d expect, but I don’t care enough to actually dig into the Economist’s report 😉

  • Mrs. Maroon says:

    Taking risks and being self-employed go hand in hand for me. Mr. Maroon has often tossed around the idea of going out on his own as a consulting engineer. But fear of the risk has always held us back – me especially. That being said, we will be able to get to millionaire status as employees. Combined we make very respectable salaries. And save like crazy now. Slow and steady, we will get there!

  • One of things that always strikes me when I meet a millionaire or anyone with significant wealth is their innate curiosity. They are always learning and looking for problems they can solve. They constantly seek new opportunities and while they are not rash, they are definitely not risk-averse either, as you mentioned. They think it through but they don’t over-think it, which is something I can occasionally be guilty of doing. 🙂

  • These mindsets are not flashy get rich schemes which is probably why do not get the level of attention that they deserve. Nevertheless, these habits are the only sure way to get wealthy (and enjoy yourself while doing it).

    A 9th mindset might be “Being Patient”. All of these factors take a while to accumulate wealth, but they surely do if you are patient enough.

  • Kalie says:

    I wonder at what point do the wealthy get into more diverse investments? Some things like real estate require substantial assets to get started. I’m currently a SAHM and naturally thrifty so we focus more on cutting spending than earning more. We are getting more aggressive about investing, though.

  • REL says:

    I applaud your article along with the others who have commented. I agree with Ben Luthi’s comment…The Millionaire Next Door is one of my favorites and perhaps the best financial book I have read. It echoes the points in this post. I am not a millionaire (because I have made many of the classic financial mistakes), but I am hopeful about my financial future because the practices you describe consistently work, and I am consistently using them. If I can do it, most people can. Be patient, be consistent, you can pull it off!

  • I have a hard time taking risks. Right now, we’re really not investing at all because we have major bills to deal with. Namely, we’ve been saving (and will keep saving) for my husband’s oral surgery in October. Think $16,000-20,000. That doesn’t leave a lot of room for investing.

    But even once that’s done, I have to get over being quite so risk averse. I’m the only earner in my family. My husband is on disability. So every dollar is hard-fought. And can’t necessarily be easily replaced.

    I forced myself to take a moderate risk IRA, at least. Which was a huge step for me. It’s something, right?

  • Thanks for these tips! It’s just that sometimes, the hard part is how to execute all of these!

  • I think I have most of those traits down. So maybe I am on the right path after all.

    Just have to find a way to make the break and stop working for the man 🙂

    Cheers!

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