Financier Thomas Corley have studied rich people for many years and shortlisted the habits that enabled them to make a fortune. He found out that self-made millionaires are divided into risky and economical ones. Risky millionaires are people who, in the pursuit of wealth, were not afraid to rely on luck. These include, as a rule, business owners, entrepreneurs, aggressive investors, or those who have created something unique and in demand. According to Corley’s study, those who took the risk are the most successful people, their wealth averaging 7.4 million dollars. Such achievements are only within the power of the most daring, persistent, quick-witted and disciplined. This format is not suitable for everyone.
Thrifty millionaires have been accumulating wealth for years, cutting costs and denying themselves much. They prudently invest the saved money. This way to earn millions takes about 32 years. People in this category do not usually tend to risk; most of their lives they work and live fairly modestly. Their wealth is less on average 3.4 million dollars. But such a method is not fraught with major risks. All that is needed is discipline, zeal, and restraint in handling money. Thrifty millionaires are distinguished by a certain mentality. Here are their seven best strategies.
They set goals and save to reach them
94% of the millionaires who have become rich due to economy save 20% or more from their salaries. And so they acted constantly, long before they accumulated their millions. Accustom yourself to save from the very first salary – 10%, 5%, or at least 1%. You need to set a goal you will save money for, and do not fail to do it. So you can develop a habit of saving. The ultimate goal is to save at least 20% of your income and invest wisely in these savings.
They avoid temptations
Many cannot resist the temptation to live in proportion to income. When it grows, so does the demand. This often happens to those who suddenly began to earn more. But if you want to get rich, you need to be able to suppress the urge to immediately lower what you have earned, and instead save money or invest. Thus, finances will grow and will be able to give you support in the future.
No matter what time luck turns its face to you, you should not change your lifestyle. Do not clog your life with trifles, buying unneeded things. Live modestly and get used to delayed pleasure — refrain from what is desired today in order to reap the benefits tomorrow.
They are thrifty
67% of the wealthy people surveyed said they were not inclined to throw money down the drain. Prudence for them means the ability to spend money wisely, i.e. to buy high-quality goods or services at competitive prices. The parents of the majority of the rich were either poor or belonged to the middle class. It is thrift that is in the list of those good habits that rich people learned from their parents and carried with them into adulthood. Only prudence will not make you rich, but you can save more money if you buy quality items for a reasonable price.
They make money invisible
Invisible salary is the one that was immediately set aside so that the current account balance does not tempt extra spending. This is how automation of your savings takes place. Open a savings account. Each time you receive money, immediately put a certain amount there. So you can spend only what is left on the main current account.
They lower their expenses
Thrifty people, self-made rich, did everything possible to minimize their expenses. Here’s how to achieve this:
- Spend no more than 25% of your monthly salary on housing.
- Spend no more than 15% of your salary on food.
- Spend no more than 10% of your salary on entertainment.
- Spend no more than 5% of your salary on a car.
- Spend no more than 5% of your annual salary on vacation.
- Never gamble. And if you really want to, allocate money from the budget for entertainment.
- Keep track of the credit card debt. If you use credit cards at the household level, then you live beyond your means. Invest wisely. Do not fall for the “secrets” of quick enrichment.
- Keep track if money is allocated to your retirement account.
They care about the quality of family life
Millionaires become millionaires, not least thanks to a successful marriage. They find a partner who shares their views, including on the family budget. Since they understand each other perfectly in financial matters, they make an excellent team — money is saved, spent and invested by mutual agreement.