To help you hit the seven-figure mark, we’ve rounded up 11 tips from people who became millionaires at a young age and people who’ve collected information on hundreds of millionaires who created their own fortunes.
We can’t guarantee millionaire status, but following these tips won’t make your odds any worse.
1. Focus on making money
“You can’t skip your way to millionaire status,” writes Grant Cardone, who went from broke and in debt at age 21 to millionaire by age 30. “The first step is to focus on increasing your income in increments and repeat the action”.
“My income was $3,000 a month and nine years later it was $20,000 a month. Start tracking the money you make and it will force you to monitor inflows and see opportunities.”
Easier said than done, but most have options. Find out how to generate additional income, with some good-paying jobs you can do on the side, and how you can earn passive income. It is important to read about the first step to take before starting any business, advice from an entrepreneur who earns up to $170,000 a month.
2. Develop multiple sources of income
One way to earn more is to increase your capital flows.
In author Thomas C. Corley’s five-year study of self-made millionaires, he found that many developed multiple streams of income: 65% had three sources, 45% had four, and 29% had five or more.
This additional income includes real estate rentals, investments in the stock market, or being a partner in a side business.
“Three streams of income seem like the magic number for millionaires in my Rich Habits study, but the more streams of capital you can have, the more secure your financial cushion will be,” he writes.
3. Save to invest, don’t save to save
Investing is not as complicated or daunting as we imagine. The simplest starting point is to contribute to your 401(k) if your company offers one, and take full advantage of that matching program, which is essentially free money.
Next, consider putting money into a Roth IRA or traditional IRA, individual retirement accounts with different contribution limits and tax structures; which one you can use depends on your income. If you still have money left over, you can investigate low-cost index funds, recommended by Warren Buffett, and search online investment platforms known as “Robo-advisers.”
The key to consistently saving money is doing it automatically. That way, you’ll never see the money you’re putting aside and learn to live without it.
4. Be disciplined and determined
Entrepreneurial psychology expert Rafael Badziag discusses the long-term habits of billionaires in his book The Billion Dollar Secret: 20 Principles of Billionaire Wealth and Success.
He spent five years interviewing 21 billionaires who had saved their own fortunes and discovered that, among other things, they are all disciplined, as reported by Business Insider.
The billionaires I interviewed are the most disciplined people I have ever met,” Badziag wrote. “They set the bar very high for themselves and the people around them.”
After studying more than 500 millionaires, journalist and author Napoleon Hill found that they all shared one quality: decisiveness.
“Analysis of several hundred people who had accumulated fortunes well in excess of a million dollars revealed the fact that each of them was in the habit of making snap decisions,” Hill wrote in his 1937 personal finance classic Think and Grow Rich.
5. Don’t brag – introduce yourself
“I didn’t buy my first luxury watch or car until my businesses and investments produced multiple secure sources of income,” Cardone writes. “I was still driving a Toyota Camry when I became a millionaire. You have to be known for your work ethic, not the things you buy.”
“The biggest financial mistake I ever made was not thinking big enough,” says Cardone. “I encourage you to go for over a million. There is no shortage of money on this planet, only a shortage of people with ambition .”
