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Plus...live beneath you means. New millionaires are flashy with money. Established millionaires don't care. They live their lives. If it looks like they can afford nicer toys it's because they can. They don't do it to impress, they are merely going about business as usual.
Most of the self made millionaires I have known started out saving money and buying real estate. They then invested heavily in stocks, bonds and bills. They then lived comfortably on passive income. Keeping up with fashion was never an issue and they wore old clothes. Their newer and younger wives would blow up money on the stupidest crap and insist on buying beach houses and extravagant jewelry....5 caret diamond rings? They want stuff as useful as a life raft in a desert or a can of gasoline in a raging inferno.
One woman confided in me after her wealthy old husband died and told me she didn't know he was so well off.
Duh...Who writes checks at car dealership for a matching set of his&her Town Cars to be delivered to the house the next morning? The same guy I talked out of buying a Rolls Royce. Who writes checks for 5 caret diamond rings? Who is invited to State Dept receptions on an annual basis?
The old guy confided in me before he would his wife.
The two I know made their money in that exact same way. One is a close friend of mine. Both her and her husband have great jobs but use most of the money for investing. They choose to live a solidly middle class lifestyle now so they can be really comfortable in the future. They have the typical 4/3 in a nice neighborhood and drive lower level luxury cars.
My friends husband is the one handling all their investments. They have a few properties and a ton of money in mutual funds. Her strength comes from the fact that she is not the typical wife you described above. She is extremely disciplined with her spending and has the same financial goals as her husband. We are close enough to where I know roughly what they are worth and lets just say they can easily put the word "multi" in front of millionaire to describe their net worth. Both are in their early 50's.
The other multimillionaire I know is a guy from my work who owns 29 investment properties. All are paid off. I'm not too close to him so I'm not sure exactly what he is worth but just his properties alone are worth around the $2 million mark. Since I have a few rental properties in the area, I'm pretty sure that he makes at least $12K/month profit just from his rentals. He also has a pension that has a cash value over $1 million and I'm sure he probably owns mutual funds too. He is also in his early 50's.
Quote:
Originally Posted by dhgunit
My dad is 54 and a millionaire, semi-retired. Not multi....I would say net worth probably in the $1.5 to $2 million range.
I'm 28 and I will probably have a net worth over a million by the time I am 33.
Here are the traits I identify.
-Hard-working. My dad has always been hard working. It paid off in the end for him. I would say I wasn't that hard of a worker up until age 26. My highest salary in that time was probably around $45k. Since then I have kicked it in gear. It jumped from that (and I bought a business which changed my whole outlook on how much hard work you have to do) to $180k last year. I expect it to increase about $50k a year over the next 5 years at least.
-Smart. You can work as hard an anyone but many people can work hard. You need to be in a field where more than just hard work is needed. I would say I'm smarter than my dad but not quite as hard of a worker. I have genius level IQ.
-Frugal. You can make a ton of money and end up dead broke. Or you can take forever to become a millionaire when it could have happened 20 years sooner if you planned right and didn't waste so much money. I said I plan to have a net worth of over a million in 5 years. I also plan to still be driving my 2008 Honda Civic at that time too. Young millionaires that are self made drive 13 year old Hondas. That is why they are now millionaires.
Plan ahead: I am 28 and have 3 different retirement accounts and I'm about to set up a 4th. It is never to early to plan for retirement. If I want to retire at 65-70 and I could live to be 90-95 then $1 million isn't going to cut it. Not the way I want to live at retirement. If I only have $1 million to retire on I will have to work up until I am 80 or die. If I am going to retire at 65 I'll need at least $5 million to be comfortable.
But that's crazy!!!! No it isn't. 50 years ago if I would have said in 2015 when I retire I will need a million dollars to live comfortably and maintain my lifestyle.....you would have said that is crazy.
You pretty much listed the same things that I see in the people that I know who are millionaires. Those qualities are definitely present in a majority who hit that level of wealth. I think you have a good chance of hitting $5 by 65 if you play your cards right. Btw when you say $5 million, do you mean in todays dollars?
I really hate working so I'm going to quit the rat race at 48. I should have more then enough by then to travel the world as I please and still maintain my lifestyle without any strain.
Last edited by griffon652; 05-01-2015 at 02:43 PM..
Going from middle-class to millionaire is no big thing. Most of the older people I know who have worked solidly throughout their lives in white-collar jobs and lived reasonably frugal lives are millionaires. And anyone who started out comfortably middle-class is not "self-made."
My dad is 54 and a millionaire, semi-retired. Not multi....I would say net worth probably in the $1.5 to $2 million range.
I'm 28 and I will probably have a net worth over a million by the time I am 33.
Here are the traits I identify.
-Hard-working. My dad has always been hard working. It paid off in the end for him. I would say I wasn't that hard of a worker up until age 26. My highest salary in that time was probably around $45k. Since then I have kicked it in gear. It jumped from that (and I bought a business which changed my whole outlook on how much hard work you have to do) to $180k last year. I expect it to increase about $50k a year over the next 5 years at least.
-Smart. You can work as hard an anyone but many people can work hard. You need to be in a field where more than just hard work is needed. I would say I'm smarter than my dad but not quite as hard of a worker. I have genius level IQ.
-Frugal. You can make a ton of money and end up dead broke. Or you can take forever to become a millionaire when it could have happened 20 years sooner if you planned right and didn't waste so much money. I said I plan to have a net worth of over a million in 5 years. I also plan to still be driving my 2008 Honda Civic at that time too. Young millionaires that are self made drive 13 year old Hondas. That is why they are now millionaires.
Plan ahead: I am 28 and have 3 different retirement accounts and I'm about to set up a 4th. It is never to early to plan for retirement. If I want to retire at 65-70 and I could live to be 90-95 then $1 million isn't going to cut it. Not the way I want to live at retirement. If I only have $1 million to retire on I will have to work up until I am 80 or die. If I am going to retire at 65 I'll need at least $5 million to be comfortable.
But that's crazy!!!! No it isn't. 50 years ago if I would have said in 2015 when I retire I will need a million dollars to live comfortably and maintain my lifestyle.....you would have said that is crazy.
Interesting post, just curious what type of business did you get into? Did you have to put a lot of money into the purchase?
I agree about it never being to early to plan. I was just listening to a Dave Ramsey with Chris Hogan , and they were talking about retirement. He was saying that retirement sounds like an "old person thing", but that it's ridiculous that people have this idea that retirement is just for older people. It wasn't until the government got involved that people had a certain age in mind for 'the time to retire'.
They were saying how it's sad when they see older people that say , "I'm going to have to work till I die, i'll never retire" .
Not retiring is cool if you love your work and would really rather spend your 'later years' working than doing anything else...but I doubt the majority of people want to do that. Having money gives one more options.
Regarding being able to retire early by not spending money on useless stuff isn't something too many people seem interested in . This is why Dave Ramsey says it's 'weird to be debt free or financial independent" because "Most people are broke, broke is normal"
That's why millionaires today , while they aren't super rare, they are still the exception rather than the rule.
Articles like this are pretty eye opening, and a pretty scary
"Almost a third of workers (28%) say they have less than $1,000 in savings and investments that could be used for retirement, not counting their primary residence or defined benefits plans such as traditional pensions. And 57% say they have less than $25,000, "
This is also sad..
"Often people want to continue working until later in life, but the survey found that 50% of retirees left the workforce earlier than planned, and of those, 60% left because of health or disability problems and 27% because changes in their company such as downsizing or closure."
So basically the idea of just continuing to work is not realistic , because of health issues and the likelihood of losing your job!
...anyone who started out comfortably middle-class is not "self-made."
You didn't build that. Everybody in fact builds from a foundation that many others helped to provide. People do contribute to their own success. But they are hardly the only ones.
Articles like this are pretty eye opening, and a pretty scary
"Almost a third of workers (28%) say they have less than $1,000 in savings and investments that could be used for retirement, not counting their primary residence or defined benefits plans such as traditional pensions. And 57% say they have less than $25,000, "
I don't know how a homeowner can get along if not able write a check for $1000 when a crisis arises. New water heater, dishwasher, refrigerator, washing machine and other things aren't always covered by insurance/warranty and need to be addressed now.
Those things are more important than impulsive purchases of things you really don't need. Thing you will be rid of 3 years from now. New AC compressor? Sure, you can finance it, but wouldn't you rather pay for it now?
$1000 is nothing these days. Kids spend that much for 2 26" rims for their cars. Even more for their sound systems.
Yes I know several. A common trait is opening your own small business and being available 24/7.
Most actually successful small businesses are simply the LLCs that doctors, lawyers, accountants, and other professionals open. Otherwise, some 30% of small businesses fail within two years and 50% fail within five years. Good thing for them that we have such generous business bankruptcy laws on the books. Meanwhile, all of the actual economic gains provided by small businesses come from fewer than 5% of their number. These tend to be both old and large for being small businesses, and the years of their success tend to be rather few -- on the order of 3-5. Then they fade back into the unproductive background. .
New AC compressor? Sure, you can finance it, but wouldn't you rather pay for it now?
Not at all. I would expect a new a/c compressor to last for many years and would much prefer to pay for it that way as well. This is a plainly a job for a Home Equity Line Man. Low interest, and likely all of it tax-deductible? I can live with that! Thank you, Home Equity Line Man!
Most actually successful small businesses are simply the LLCs that doctors, lawyers, accountants, and other professionals open. Otherwise, some 30% of small businesses fail within two years and 50% fail within five years. Good thing for them that we have such generous business bankruptcy laws on the books. Meanwhile, all of the actual economic gains provided by small businesses come from fewer than 5% of their number. These tend to be both old and large for being small businesses, and the years of their success tend to be rather few -- on the order of 3-5. Then they fade back into the unproductive background. .
True a lot of businesses do end up failing. Doctors, lawyers, accountants are least likely to fail for the most part.
I don't know about the data though , you hear that 1 out of 10 businesses fails in 5 years and things like that, but then I have heard that data doesn't include all the possibilities, mergers, etc.
I don't see how ,"all of the actual economic gains provided by small businesses come from fewer than 5% of their number. "
If you have a business and employee people and are participating in the economy that's not an 'actual economic gain' ? Not sure what that means.
If a guy opens a business and has 50 people working for him . Would it have been better economically if instead he just worked at a place as an employee?
Sure he's not never going to have 1,000 employees...but still there is an economic benefit, no?
* no school debt
* lucrative professions
* consistent investment (from day one of their first job)
* a bent toward frugality (but not extreme)
* married
* late parenthood (30+)
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