Most people dream of millions in their bank account, driving fast cars and travelling the world in private jets. However, only a select few 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 their own perspective. There is no one way or set actions to copy.
Some wake up early while others sleep in, some read, and others can’t even spell, the dichotomy in actions amongst successful are endless. We are made to believe that a magical formula exists. Some short cut that fast tracks this journey.
In the Internet age one can acquire knowledge on any subject with a few keystrokes. It is magical. Most people are yet to fully understand the significance of that power. A curious mindset provides limitless opportunities.
Principles, however, remain constant. They significantly enhance the chances of achieving the objective. The reason why only a select few manage to become millionaires is master and incorporate certain principles into their lives.
After researching hundreds of millionaires, this article describes 5 core principles on how to become a millionaire. Process and trends
How to Become a Millionaire
Start with your mindset
Achieving the ‘millionaire’ status starts with growth mindset. Belief is a key ingredient to achieving your goals.
Warren Buffet, one of the richest men in the world is the embodiment of patience and long-term planning. At age 20, his net worth was $20,000. By 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 over $90 billion. (source).
In addition to that, Warren Buffet is renowned for being simple. To get an idea of his aversion to being fancy, 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 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.
Plan and Pivot
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 the amount of effort each dedicates towards their plans.
Most 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.
Putting plans to paper is 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. Opposed to operating entirely on instinct. Plans that are followed by consistent execution brings success.
Learn the basics of Finance
Balance sheets, Income Statements and basic terminologies are key to understanding money. How can you be rich without knowing the language?
Financial reviews and plans are a comprehensive evaluation of one’s financial state – now and in the future, by using known variables such as income and 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.
Establish multiple income streams
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.
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.
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.
Invest in your knowledge and skills
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 post you can learn about How to Master Customer Retention and Get Endless Repeat Business. A 5-minute read that could be a game changer for your business.
Andrew Carnegie, a steel tycoon was most prominent between the late 1800s and early 1900s. He was one of the richest people in the history of the world. Approximately 310 million is what his fortune was worth. Carnegie had little formal education. Contrary to belief, large percent of millionaires are self-made.
In his final years, he opened up 2,509 libraries around the world in order to help unprivileged people. He promoted ‘free knowledge’ by distributing books. Andrew Carnegie too, understood the value of reading.
Tucker Hughes became a millionaire at the young age of 22. He wrote “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 at the beginning because you need to adopt many new habits and strategies. Reading 30 minutes each day may not be a daunting task for some, 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. By emulating these ways, you will eventually curve yourself into one.
Mastery can only be achieved through a consistent repetition of the same tasks.
Every so often, take time to review the output from your performance. If you see your results moving in the right direction, double down.
Most times, things won’t go to plan. That’s when you need to pinpoint what’s not working and strategies to rectify. It is very important to check in on your master plan. Keeping an eye on the direction which you are moving. You could be sailing off course and before you know it, you’re heading to different destination.
