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In my five year study of the rich, I got to be that fly on the wall. I asked each of the 233 millionaires 144 questions, broken down into 20 categories.
The insight into their lives completely changed my understanding of millionaires and how wealth is accumulated. My disdain for the rich morphed into admiration.
All of the indoctrination about the rich I had received growing up without money, melted away under the hot coals of reality.
So, without further adieu, allow me to turn the flashlight on, so that you too can gain a better understanding about who the rich are:
We are worth at least $3.2 million. Sixteen percent of us are worth more than $5 million. We make at least $160,000 a year. Half of us make close to $500,000 a year.
We’re not young. Eighty percent of us are 50 years of age or older.
It took us a long time to accumulate our wealth, depending on the path we took.
70 out of 233 of us were Saver-Investors. It took us an average of 32 years to accumulate an average of $3,260,000. We made most of our money saving 20% or more of our middle-class net pay. We then prudently and consistently invested our savings over many, many years. Most of our savings were invested in stocks or mutual funds. As we got closer to retirement, we became more conservative and, to protect the wealth we had accumulated, we shifted our investments into less aggressive investments, such as bonds or annuities.
21 out of 233 of us were Big Company executives. Most of us worked for large publicly-help companies. The rest of us worked for large partnerships or LLCs. It took us an average of 21 years to accumulate an average of $3,375,000. Eight of us were also Saver-Investors, which helped to further grow our wealth. We made most of our income in the following ways:
Stock Compensation – We received significant amounts of qualified and/or non-qualified stock options, stock grants or stock equivalent compensation in the form of stock appreciation rights.
Profits Distributions – Those of us who were partners or shareholders in large privately-help companies received profits distributions that were often significant.
Base Compensation – Our base compensation grew over many years, as we rose up the ladder within our organizations. For some of us, this compensation was as high as $500,000.
48 out of 233 of us were Virtuoso’s. We were considered among the most expert within our industry. It took us an average of 20 years to accumulate an average of $3,980,000. Some of us were Knowledge-based Virtuoso’s and some of us were Skill-Based Virtuoso’s. Due to our unique expertise, we were among the highest paid within our respective industries. Because we were in such high demand, we were able to make additional income as paid speakers, speaking at national and international industry events. This speaker income was significant – some of us made as much as $250,000 per year as paid speakers. Seventeen of us were also Saver-Investors, which helped to further grow our wealth.
108 out of 233 of us were Entrepreneurs. We pursued some dream. It took us an average of 12 years to accumulate an average of $7,450,000. Thirty-seven of us failed at least once in business. But that didn’t stop us from trying again. Ten of us were also Saver-Investors, which helped to further grow our wealth. Growing our wealth was very stressful on us and on our families. We worked long hours and many of us struggled financially in the early part of our journey.
We liked our jobs. Eighty-six percent of us liked what we did for a living. Seven percent of us loved what we did for a living and 7% of us did not like what we did for a living.
The richest among us had success mentors who taught us what to do and what not to do. For some of us, our mentors were our parents. For others, our mentors were work-related.
We were voracious readers. We read every day to learn. 88% of us read every day to increase our knowledge for our job. 85% of us read a minimum of two books a month. 63% of us listened to audio books or podcasts while we’re commuting to work, exercising or working in our backyards. We didn’t read for entertainment. We considered that a waste of time.
177 out of 233 of us were self-made, meaning we came from either poverty of the middle-class: 41% of us came from poverty and 59% of us came from the middle-class. Only 24% of us were raised in a wealthy household.
We have many good habits and few bad habits. 73 out of 233 of us learned our Rich Habits from our parents.
We’re competitive. 63% of us played competitive sports in high school.
We’re in good health. We exercise almost every day. 76% of us exercised at least 30 minutes a day, 4 days a week. We like to jog, run or bike. We watch what we eat every day. We don’t eat much junk food. We don’t go to fast food restaurants. We don’t eat candy. We don’t get drunk. We don’t do drugs. We floss every day. We sleep at least 7 hours a night. We don’t smoke.
We like to mentor others. We get enjoyment in helping others succeed in life.
We’re charitable with our time and money. 72% of us volunteered 5 hours or more a month at local, community-based non-profits. We also give money to these same charities.
Almost all of us have financial advisors. We bounce everything off our CPA. We also have attorneys, financial advisors, certified financial planners and sometimes estate planners. Some of us like to pick our own investments but then we almost always bounce investment ideas off our financial advisors.
We’re happy.
Same house, same wife and same car. 64% of us own modest homes. We’ve owned our home for at least 20 years. Very few of us get divorced. We drive old cars. Most of the time we buy good used cars. We hardly ever lease a car.
We plan our day. 81% of us keep a to-do list or Priority List, which helps us prioritize what we would like to accomplish during our very busy days.
We vote. 83% of us vote at every election.
We don’t spend a lot of money on vacations. 96% of us spend less than $6,000 a year on vacations. 41% of us spend less than $3,000 a year.
We wake up early every day. 41% of us wake up at least 3 hours before our work day actually begins. During those three hours we read to learn, some of us write, others study facts about their industry. We also use some of that time to exercise.
Many of us, except for the Saver-Investor millionaires, were decision makers where we worked. We’re one of these: small business owner, CEO, senior executive, CPA, attorney, doctor, financial advisor or salesman.
We’re frugal. We seek to spend the least amount of money on the highest quality products or services.
We went to college. 68% of us went to college. 56% of us had to work our way through college. 21% of us went to graduate school.
We’re not afraid to take risks. 63% of us took a risk in order to become rich. 27% of us failed at least once in business.
We work a lot. 73% of us work an average of 58 hours a week.
We love to pursue goals. 80% of us are focused on one major goal at any given time.
We get mad or angry but we don’t express those emotions – we control them.
We hang out with other successful people or people who are upbeat, optimistic and have something on the ball. We don’t hang out with negative people or people who complain all the time. We avoid them like the plague.
We hardly ever gamble. 84% of us never gamble.
We believe in the American Dream. Our parents instilled that in us. We are living the American Dream.
We obey the laws. N99% of us have never been arrested.
We built teams to help us succeed. 84% of us have a team of individuals we rely on every day.
We are savers. 94% of us eventually became Saver-Investors, saving 20% of our income. All of us have retirement savings.
We have more than one source of income. 65% of us have 3 streams of income. 45% of us have 4 streams. 29% of us have 5 streams.
We don’t watch TV. 67% of us watch less than an hour of TV each day.
We’re optimists. We have a positive mental outlook. We avoid associating with or doing business with anyone who has a negative outlook on life.
We don’t lie, we’re honest.
We weren’t exceptionally smart in school. 77% of us were either C students or B students in school. But we got smart after school. We self-educated ourselves. We never stopped learning our entire adult lives.
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