While getting rich may not be easy, that hasn’t stopped over 10 million households in America from reaching millionaire status. Saving up that amount isn’t for the faint of heart, but with the right behaviors and goals, it may be within reach. Today, let’s take a look at the advice of three millionaires to help you get started saving. Even if you don’t end up a millionaire, perhaps you’ll be inspired to take a fresh look at your financial habits.
Think Like a Millionaire
Becoming one of the rich and fabulous may have more to do with your thought process than your starting bank account. Steve Siebold, a multimillionaire and the author of the book “How Rich People Think,” spent 30 years interviewing millionaires and billionaires to learn how they ticked. In 1984, as a broke college student who wanted to gain wealth, he began interviewing the rich to see if he could find patterns in their habits and mentalities. He learned that there’s a clear difference in the psychology of world’s richest people compared to that of the masses. “The majority of the 1200 millionaires and billionaires I’ve interviewed convinced me that how you think is the foundation of your fortune,” said Siebold. “It’s the catalyst for all of your actions and behaviors that lead to riches.”
In terms of building wealth, Siebold suggests that you start with the influence and resources you’ve already built in your life. “Leverage every asset you have to get rich; including your contacts, education, credibility, skills, knowledge, money, etc.” In other words, look at the resources you’ve already accumulated and make them work for you on your path to wealth.
This doesn’t mean, however, that you should be working yourself to death. Instead, it’s about optimizing your strengths and resources for building wealth. It’s Siebold’s belief that “the working and middle class use labor to make a living. The rich use leverage. Hard work will not make you rich. Leverage will.”
Siebold’s One Tip for Aspiring Millionaires
Ignore people who discourage you or tell you that you’re dreaming. They’re wrong and probably broke. Find something you love to do that solves a problem for people. The bigger problem you solve, the richer you’ll get.”
Persevere and Prioritize Like a Millionaire
April Davis, a millionaire and the founder of LUMA (a luxury matchmaking service), used her skillset and interests to build wealth. Whenever she met someone who was single, she would naturally begin thinking about people who might make a good romantic match for them. This hobby quickly evolved into a full-time career of helping singles find love. Davis saw the need, recognized her own abilities and went to work filling that need.
For Davis, perseverance and hard work were the catalysts for her wealth. As she explains, these habits grew out of necessity. “I grew up with very modest roots in a family of six kids so I knew early on I needed to work and make my own money if I didn’t want to wear only used hand me downs,” said Davis. “Wealth building back then was done out of necessity. I had to buy my own clothes, shoes, and food most of the time.”
Humble origins helped drive Davis to financial stability and independence. “When you’ve been poor, you know what it’s like and you never want to go back there,” said Davis. “Money is a form of security and we all want security, but it just comes in different levels of comfort for different people.”
Beyond hard work, Davis recommends organization, prioritization and delegation as keys to building wealth. “Use lists and plan your day’s priorities so things don’t get lost. Outsource, train, delegate everything you can.” Even simple tactics, such as knowing where your money is going and budgeting, can have big impacts down the road.
Davis’ One Tip for Aspiring Millionaires
“Money is great and important, but it’s not everything. Every day I meet people who are extremely wealthy, but they’re also lonely. Don’t forget to invest in the most important area of your life… your family and relationships. After all, you can’t take it with you. There’s no hitch on a hearse.”
Spending and Saving Like a Millionaire
When you think about the rich, it’s easy to imagine mansions, private islands and fancy cars, but many of them live frugal and calculated lifestyles. For Rocky Lalvani, becoming a millionaire was a result of a simple but effective plan. Once he started receiving paychecks after college, he set up automatic deductions to go toward investments and savings. His strategy largely included “automated savings, which kept escalating every time I got a raise or paid off a loan.”
As a child, Lalvani’s parents took him around the world, seeing much while spending little. “They taught me how to reach for the stars on a minuscule budget,” said Lalvani. “We never focused on what society burdened us with – there was never an excuse for why we could not have it all.”
Frugal living has been one of the keys to Lalvani’s success. But what does thrifty living actually look like? For Lalvani, “Frugal means buying nice, long-lasting items and keeping them for a long time, while paying very little.” It’s all about the quality that will last the test of time. In many cases, Lalvani has been able to find products at massive discounts, whether that be a house, a suit or a car.
To do this, he explains that you have to be focused on your wealth-building goals, even if it means getting in the way of the perception of how millionaires “should” act. “Let someone else buy the round of drinks at the bar,” said Lalvani. “I don’t need to impress people with overpriced stuff, but rather with stuff they will never believe I paid so little for. I have negotiated with Sears, Home Depot, Lowes, HH Gregg and other retailers. I even negotiated with Car Sense who doesn’t negotiate. I wait and watch for deals, and that means buying off season.”
Throughout Lalvani’s journey to building wealth, he admits to making plenty of mistakes, including everything from pulling his money out of the stock market in 2008 to impulse buying to waiting too long to buy real estate. But with time and perseverance, he learned from his blunders. “Now as I look back I am much wiser and I teach my kids to learn from these mistakes. Now I pay people to do what I can do so I can work on bigger projects. When I flip a house I could do a lot of the work, but instead I pay others so I can find the next deal.”
Lalvani’s One Tip for Aspiring Millionaires
“Build wealth through automated savings, invest in yourself, learn from other people’s mistakes, take chances. This is not going to be an overnight success, it takes years and commitment to the goal. The money is just one part of a richer life, you need to know what you want to do, and I don’t mean buying stuff and enjoying vacations. What’s the bigger purpose and are you sharing that story?”
So You Want to Be a Millionaire
As you pursue the goal of becoming a millionaire, use the advice of these three experts. Notice that none of them discussed falling into their wealth. For each of them, their success was the result of sound financial planning long before they became millionaires. Take some time to think about your own path to success as you begin creating wealth for yourself.
Do you have tips for other aspiring millionaires? Let us know in the comments below!
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