Do you dream of becoming a millionaire? If so, you might want to consider studying the behaviors of people that have already reached that goal. Of course, you don’t want to stop the next person you see in a Mercedes and ask the driver all kinds of questions. Instead, you can find this information in financial books that are widely available.
Once you start doing some research, you will likely find that many of the people that look wealthy may not be well off at all. Many of the people that enjoy the trappings of wealth are up to their eyeballs in debt. You will also find that most of the real millionaires don’t drive expensive cars or live in mansions, but instead live in middle class neighborhoods, drive modest cars, and buy their suits right off the rack.
When you understand the mindset of real millionaires, you can work on developing the same habits and work toward reaching your goal. Following are some of the beliefs and habits that most millionaires have in common:
Income Does Not Equal Wealth – While higher income earners are typically wealthier than lower or middle wage earners, the size of the paycheck accounts for just 30% of the wealth variation. What matters most is how much of your income is invested. Millionaires, on average, invest 20% of their income.
Budgeting- Nearly every millionaire has a budget. They work on planning their expenses and include investing in this budget.
Know Where Your Money Goes – Do you know where your money goes? Nearly two-thirds of today’s millionaires know exactly where their money goes. On the other hand, only one-third of those high income individuals that are not millionaires know where their money is going. The point is that most millionaires keep track of their spending.
Know Where You Want Your Money To Go – Those people that have clearly defined financial goals are more likely to reach them. It’s important to have a savings and investment strategy that will make it possible to reach your retirement goals.
Time is Money – While it takes time to set goals and create budgets, most millionaires are willing to invest the time. You don’t have to earn a six figure salary in order to enjoy financial independence, but you do have to devote time to planning and budgeting.
Enjoy the Home You Have – Your home and how often you buy a new one is a major factor in your ability to accumulate real wealth. More than half of the millionaires report living in the same home for over two decades. If you live in an expensive home in an exclusive neighborhood you are going to spend more maintaining this lifestyle and severely limit your ability to save and invest.
This is just a small sample of what you’ll find in books that describe how millionaires have built their wealth. For those individuals that want to accumulate real wealth of their own, it makes perfect sense to follow in the footsteps of someone that’s already accomplished this.