Money Habits of Millionaires

Research has showed that 80% of millionaires are ‘self-made’, which means that they didn’t come from families that had money from which they built their wealth but rather, they are ‘first generation rich’, having made the money themselves. Financial expert David Ramsey, considered to be “America’s most trusted voice on money” lends his advice on how these millionaires got there, and how you can achieve millionaire status too.

Wealth and happiness go together, read more about what makes people happy.

The first tip is “Living Intentionally”, this means that wealth was built through a slow and steady investing strategy. A statement of priority was made and kept. Ramsey insists that you have to have a focus, people do not accidentally end up millionaires. While admittedly celebrities, sports players and lottery winners all fell into their fortune, they still only comprise 1% of all millionaires.

The second piece of the pie is “Consistent Investing”. A large majority of millionaires developed their wealth by consistently investing a part of their income every month. Ramsey recommends setting aside an amount every month be it $100 or a percentage of your earnings. Many millionaires that Ramsey has come across have used a transfer system where an amount of monthly income is automatically put into a savings account, such as a 401k. For most millionaires it took them 10-20 years (on average 17 years) of regular savings that have accumulated over time to eventually build the capital of their wealth.

Lastly, but perhaps most interestingly, is the prioritisation of “Generosity”. Generous people come across as being highly attractive, they tend to be grateful, smile a lot and in effect often get included in top money making deals because people feel that they can trust them. In fact, in his research, Ramsey has found that there is a high correlation between generosity and millionaires. Furthermore, these people didn’t become generous when they were millionaires, but millionaires when they were already generous.

So for an optimistic Ramsey the good news out of all of this is that the American dream of making your millions is absolutely still alive!