If you are up early, I will be on CNBC’s Worldwide Exchange at 5:50am on Wednesday, March 21.
The lives of the “rich and famous” tend to be quite a bit different from the lives of the merely “rich.” In fact, studies show that being rich often results from a rather low-profile lifestyle.
With that said, if you want to live the life of a millionaire, here’s your guide:
According to ”The Millionaire Next Door,” by Thomas Stanley and William Danko, 80% of the millionaires worked and saved to generate their wealth and 80% of them are still working. About half of all millionaires are self-employed or own a business. Nearly half of working millionaires plan to toil part or full-time during the retirement years, according to a survey from Northern Trust Corp. Millionaires are also less likely to waste time during the day; instead they are reading and doing things that contribute to their success.
Be very conservative with your money.
Individuals who build wealth tend to live well below their means. Affluent households are heavier coupon users than those with lower incomes, according to a 2009 study by Nielsen and market research firm Inmar. In researching for the book cited above, Thomas Stanley reports that he found 11% of vehicle purchases by US millionaires were Toyotas. Most millionaires buy and drive used cars and have never spent more than $55,000 (in 2010 dollars) on a new car. Their homes are typically worth less than $300,000 (in 2010 dollars), according to Stanley.
More money doesn’t necessary solve money worries. According to surveys, few millionaires feel rich. They worry about having enough money in retirement, increasing health-care costs, funding their kids’ college education and paying the bills.
Take calculated risks.
Millionaires tend to be aware of their personal income and net worth statements, and have taken strategic risks to earn and grow money. They take calculated risks with an exit strategy and plan to protect the downside.
Be a bit rebellious.
To become wealthy, you have to have the ability to resist the peer pressure to spend and accumulate possessions. You need to be willing to be different, to look for opportunities outside of the mainstream and take those opportunities when they present themselves. Perhaps this is why many male millionaire entrepreneurs had been in trouble with school authorities or the police during their adolescence, according to one study.
Millionaires recognize that they can’t be experts at everything and hire the best resources they can find.