How to Become a Millionaire by Adapting 5 Powerful Principles
Many people dream of having millions in the bank account, driving fast cars and travelling the world in private jets. Having lots of money is the life mission of very many people, however only a select few usually manage to achieve it. Numerous books have been written on the subject of ‘how to be become a millionaire’, but the truth is that every author has his or her own perspective; there is not one definitive set of buttons to press.
There are principles, however, which remain constant, and that can significantly enhance the chances of achieving the objective. The reason why only a select few usually manage to become millionaires is because those are the people who take the time to master and incorporate the fundamental principles into their lives. This post will look at 5 core principles, as discussed in the best-seller books ‘Change your Habits, Change your Life’ by Tom Corley, and the classic ‘Think and Grow Rich’ by Napoleon Hill.
The book ‘Think and Grow Rich’ was the result of more than 20 years researching rich and influential people. By 2015 it had sold more than 100 million copies, making it one of the best-selling books of all time. On the other hand, Tom Corley interviewed more than 200 wealthy individuals prior to writing ‘Change your Habits, Change your Life’ and found that they all shared a common set of traits – similar to Napoleon Hill’s findings. Some of those principles form the basis of this discussion. Once you’re done reading this post and feel inspired to take action, here are some business ideas that you can get started with minimal upfront capital. The key is to take action immediately, otherwise the inspiration will be lost if you don’t move fast enough.
How to Actually Become a Millionaire
- Start with your mentality
Achieving the ‘millionaire’ status in the real life requires a lot of patience and long-term planning. You need time to master all activities which are intended to make you money. Warren Buffet, the 3rd richest man in the world is the perfect embodiment of patience and long term planning. At age 20, his net worth was $20,000.
At age 30, his net worth was $1 million. At age 50, his net worth was $350 million. At age 60, his net worth was $3.8 billion. Today his net worth is $73 billion. (source). In addition to that, Warren Buffet is renowned for being extremely frugal. To get an idea of how frugal, have a look at the simplistic nature of his company’s website – Berkshire Hathaway, the world’s largest financial services company with over $210 billion in annual revenues.
While the example of Warren Buffet might be over the top for most people, many other wealthy people have accumulated their riches throughout an extended period. This is not to say that it’s impossible to become a millionaire in a year or two, the point is that you should be mentally prepared for a battle that could potentially take very long.
You need to be ready to fight every single day and not accept defeat until you achieve the desired financial goals. It could take 6 months, 1 year, 5 years, 20 years or even more, but as long as you’re mentally prepared for a long term battle, you will eventually emerge victorious. Even the absence of initial capital or some sort of infrastructure should not encourage you to give up – being in it for the long term is an attitude that will get you there.
- What is your plan?
Self-made millionaires do not end up rich by accident, they plan for it. A significant difference between people that are highly successful and those that are not is the amount of effort each dedicates towards their plans. Most average people do not have well defined plans of how they intend to achieve their goals; they tend to just go with the flow. Successful people on the other hand do not go with the flow; they create their own personalized plans and roadmaps. Taking time to develop a well-defined plan will force you to take action rather than just talk. Here are 2 posts I would recommend to help while planning for your business:
A separate financial plan must be contained within the overall plan. Financial plans are a comprehensive evaluation of one’s financial state – now and in the future, by using known variables such as monthly compensation, fixed expenses such as rent and school fees, etc. Such plans help determine if the financial goals will be met in the future, or how to steer things in a direction that can ensure that they will be met.
Many people often focus all their energy on the ‘making money’ part, neglecting the fact that controlling expenses is also fundamental part of the ultimate objective. Give your future self an advantage by looking at all current expenses, even the small ones, from a long term perspective. For instance, a cup of coffee which you buy on a daily basis for roughly $5 equates to $35 in a week, $140 in a month, $1,680 in a year, and $16,800 in 10 years. That is $16,800 which you are stealing from your future self, from just one cup of coffee each day; how about if you factor in all the other ‘small’ expenses? They become a huge expense possibly in excess of $100,000.
Putting plans to paper is like an official launch of the march towards becoming a millionaire. It is easier to take action when you have a definitive direction and set of guidelines to follow, as opposed to operating entirely on instinct. Plans that are followed through to the end are what create success. That is precisely how to become a millionaire.
- Establish more than one source of income
Tom Curley, author of the best-selling book ‘Change your Habits, Change your Life’ interviewed over 200 wealthy individuals, and found that most of them do not rely on a single source of income. In fact, 65% of them had at least three income streams, 45% had four and 29% had five or more. Such additional income streams may come from things such as side businesses, investments, freelancing, consulting, etc. For some business ideas that you can adopt to diversify your income streams, check out The Most Practical Business Ideas that you should Consider.
It all boils down to risk reduction. Living off just a salary or the income of a single business is very risky. Establishing multiple sources of income means that the cumulative earnings from all the ventures will propel you faster towards becoming a millionaire. And on a bad day, well, not all your eggs are in one basket. The ventures that are performing well will make the ones which are under-performing to fade in contrast. Once you establish the most ideal venture to take up, I would recommend you learn about realistic sources of finance that you can leverage to acquire the initial capital to get started.
- Upgrade your skills and knowledge
A whopping 88% of the wealthy people that Tom Curley interviewed prior to writing his best seller ‘Change your Habits, Change your Life’ admitted to devoting at least 30 minutes each day on self-education. Reading is perhaps the most shared trait among highly successful people. Regardless of how busy their schedules might be, as you may imagine, reading is always high up on the to-do list. This is because they understand the value. Meanwhile non-successful people spend their hours browsing Facebook and Instagram.
Regularly reading opens up the mind to a world of endless possibilities. For instance, in this brief post you can learn about How to Master Customer Retention and Get Endless Repeat Business – a 5 minute read that could be a life saver for your business. Andrew Carnegie, a steel tycoon most prominent between the late 1800s and early 1900s, was one of the richest people in the history of the world (his net worth today is estimated at over $310 million). Carnegie had very little formal education, but credits most of his success to self-education. In his final years, he opened up 2,509 libraries around the world in order to enable unprivileged people help themselves with the ‘free knowledge’ contained within books. Andrew Carnegie too, understood the value of reading.
In the modern era one can acquire knowledge regarding almost any subject by just typing a few words on the internet. It is quite magical. Most people are yet to fully understand the significance of that power and where it can lead to if properly harnessed. Tucker Hughes, who became a millionaire at just 22, wrote that “You don’t just need to be a master in your field, you need to be a well-rounded genius capable of talking about any subject whether it is financial, political or sports-related. Consume knowledge like air and put your pursuit of learning above all else.”
- Monitor and repeat the process
The journey to becoming a millionaire is usually most difficult in the beginning because many new adoptions are required. Reading 30 minutes each day may not be a daunting task for some people, but for non-readers, it is. It is absolutely paramount to adapt the mindset of a millionaire. You need to start thinking like millionaires do, talking like millionaires do, acting like millionaires do; and by repeating these tasks over and over again; you will eventually curve yourself into one. All the principles which we have covered in this discussion, and all the others which you will uncover through further research, will take time to master. If you still wondering how to become a millionaire, then one way to summarize it is through profound mastery of a set of money making activities. Mastery can only be achieved through a consistent repetition of the same tasks.
Every now and then you will need to sit down to review the output from your performance over a certain period; whether a week or a month. If you establish that things are moving in the direction of the plans which you had initially outlined, then you’re on track to realizing your goals. If things are not working out as planned, then you need to figure out exactly what needs to be rectified and how to get things back on track. It is very important to constantly monitor the master plan while at the same time keeping an eye on the direction which you are moving. You could be sailing off course and not even know it.