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Tuesday, September 17, 2019

8 Traits of People Who Are Millionaires

Many people work hard in their career hoping they can someday become a millionaire. I think most people in the world would answer “yes” if they were asked whether they want to become a millionaire. There are studies that show that there are 10 million “millionaires” just in the United States alone. So how did millionaires become wealthy in the first place? Did they inherit the money from their wealthy parents or maybe win the lottery? You would be surprise when I answer this question. The truth is that 62% of billionaires in the United States are actually self-made, meaning that they got to where they are by themselves. I was curious about millionaires that became wealthy and went to do a deeper analysis by reading the book The Millionaire Next Door by Thomas Stanley. I read the book and learned that 80 to 86% of millionaires in the United States become one by creating their own wealth. I was surprised with these facts about millionaires. I always thought that people who are wealthy made it is because of financial support from their parents or got lucky in certain aspects of their life. So what made these millionaires or billionaires different from us? Why are they able to achieve this magnificent wealth by themselves? The truth is that the traits of millionaires do have can be adapted by anyone who chooses to adapt them. I am willing to share my knowledge and research about the traits of millionaires in this article.

1. They Have an “Affluence” Mindset
The journey to become a millionaire require you to have a positive attitude. Those with affluence mindset will see they have the potential of becoming wealthy, and those with a “lack” mindset would probably not achieve this goal. What does it mean to have an affluence mindset? By having one give you the perception that you deserve financial independence and that becoming wealthy is possible. I encounter this through real life experience when I see my dad who became wealthy. He has a mindset that was different from many people. He was not born from a wealthy background family. In fact, he was very poor when he was young. Living in village where opportunities were very little and have no money to pay the school tuition. He wasn’t even able to finish his high school since he had to work to support the family. My dad’s parents passed away when my dad was still young at age. However, my dad still has positive mindsets that enable him to become the person he is today. He worked really hard, and always trying to figure out ways in order to be financially wealth off. I personally think if you have the mindset of getting becoming rich, you will broaden your mind and finding solution to be one. A positive attitude is a must in order to achieve success in life. You have to be confident with yourself.

2. They Dream Big
Becoming a millionaire isn’t for people who refuse to have hope. To achieve that financial goal means that you believe you are able to achieve it, and willing to make the sacrifice and the journey to get there. If you have trouble with this step, you should start taking some time each day and envision yourself as a millionaire. Imagine yourself being debt free and financially free from worries. Dream on how it feels if you have a net worth of a million dollar. The sooner you start viewing yourself as wealthy person, the sooner you’ll make the commitment to become one. This way you will make the decision to move into that direction. 

I know this is just a dream, but is never wrong to dream big. Having a dream since young that I want to be wealthy make me choose the paths that I believe would eventually lead me to one day become wealthy. I don’t consider myself to be wealthy right now since most of the family wealth is owned by my parents who accumulate it. However, since young I always wanted to be financially independent. I always imagine myself if I had a million dollar of my own, and imagine the passive income I can receive from having a million dollar. At young age, I always imagine myself to be able to purchase or spend on stuff with the passive income if I had a million dollar. Knowing the benefit of having assets that generate passive income for me makes me feel wonderful since I do not have to worry about money. So it’s “okay” to dream of becoming a millionaire even when you’re not. But most importantly, you’ll need to take the action!

3. They Thrive On Educating Themselves
Self-made millionaires or billionaires don’t become wealthy just by waiting for money to be handed out to them. They don’t spend their time sitting down in front of the television or playing on their smartphones on unproductive things. Instead, they spend most of time to educate themselves on how to accumulate wealth. Most wealthy people will tell you that education is the key to becoming millionaires. It does not necessarily mean formal academic education, but the literacy of becoming wealthy. Having the knowledge of financial literacy can enable a person to become wealthy. There are many resources in the internet and books that teach people how to build wealth. Whether or not you decide to take the time to read that information and learn about it, it’s still depends on you to make the action. If you are really serious about becoming millionaire status then you’ve got to commit to educate yourself and learn the experiences from people who have already achieved that goal. In addition, following a good mentor can help and guide you to the right path. A great mentor will share insights and offer perspective through your strength and weaknesses. They can share personal experience and knowledge that can’t be learned in school. Mentorship is crucial in helping many people who want to be millionaire since you can learn many valuable things from them.

I was always curious on how to becoming wealthy since I was young. Even till today, I am searching and learning of ways of becoming wealthy. It is not simple task and requires you to have a discipline mindset to always want to learn new things. I read up on successful people such as Warren Buffett who is currently one of the richest man in the world. By educating myself about his life, I learned that people can be wealthy by investing. And that’s the reason why I decided to become a dividend growth investor myself and invested in stocks that pays out dividends and growth in their share prices. I didn’t become a successful investor overnight. I had gone through experience of losing money in the stock market which mistakes educate me to become a better investor. Till today, I’m still learning to educate myself to become a better investor.

You can’t stop learning if you want to become a millionaire. After starting my career working in my dad’s company, I learned that my dad didn’t stop learning and educating himself even till this day. He is a good example of a successful and wealthy person that I admire. He is always trying to figure out how he could expand his business and create wealth. By constantly learning new things as well as learning from mistake enable him to become an experienced and successful business man today. Without the knowledge and the dedication to learn, you are not able to become wealthy. You need to get out of your comfort zone in order to achieve that goal. But this does not mean you should blindly make the move. You still need to make intellectual decision and to always stay open minded for opportunities.

4. A Defined Plan and Steps to Achieve that Goal
Simply saying that you want to be rich is not enough for you to get wealthy. If you truly want to be wealthy, you need a strategic plan to achieve that goal. You need to ask yourself some questions such as in what way can I build my wealth? What are the daily, weekly, monthly and yearly steps to get to that goal? By defining your plan and arranging a path to get there are important steps to achieve that millionaire status. If you want to succeed at your goal, you need to map out the specific steps to build that wealth. For instance, I learned that by investing my monthly savings regularly in the stock market using dividend growth and value investing strategy enable me to compound my wealth over a long period of time. Having this financial plan gives me the ability to make reasonable and achievable financial goal that I want to pursue. In addition, I also realize that I need to figure a solution to increase my income in order for me to be able to save and invest more, so I can reach the goal faster. This is just some basic plan and steps that I am currently working on to achieve that goal. Be creative with your plan and step to achieve the goal you always wanted.

Moreover, I learned by watching the way my dad create his wealth. He always maps out a plan in order for him to achieve that goal. By having a plan, he is able to make step by step process for him to become successful. For example, when my dad decided to start his manufacturing fan business, he didn’t just blindly go into that business. He carefully learn the market demand for that products, and work his way out in order to make his products competitive in price but good in quality. He knows who the target consumer of his products is whether it is aim towards the middle class consumer or higher class consumer. By him to carefully plan out a strategy and make the move into that business made him wealthy and successful today. There is a quote by Sun Tzu, “Every battle is won before it’s ever fought”. The quote makes me realize a defined plan, strategy as well as steps are required to win any battle (success and goal).

5. They Have a Willingness to Work Hard
Just having a plan and strategy does not solve the equation of becoming successful and wealthy. In other word, millionaires don’t merely just sit around talking about the plan and strategy. They need to put a lot of time and commitment working hard towards their goal. They don’t just sit around waiting for money to rain from the sky. Instead, they are always figuring out what they need to do to get to the destination they want to reach. Those who had achieved millionaire status have been doing their task every single day to achieve the plan and steps they’ve laid out (see number 3). If you’re willing to work hard every day, targeting your goal of achieving wealth. Surely, it has increased your chances of becoming a millionaire by tenfold.

I learned from my dad’s daily activity on how he always accomplish the goal he wanted. He is always doing things that he planned out and making the move to reach that accomplishment. For example, after finished planning and figuring out the steps to make a successful product for his business, he was always constantly willing to work hard in order to make his product different from its competitor and have a quality that is high in value. Because of his willingness of working hard every day, he is able to enjoy the fruits from the trees he planted.  It is just a common sense, without the willingness to work hard to achieve that goal; your plan will just be nonsense. Truthfully, I have great plans and strategy to meet my goal of becoming a successful blogger. However, one flaw I have is my laziness. Without the willingness to work hard, I spent too much time just dreaming and planning my goal without actually making the move. Moreover, I spent so much time wasting on unproductive things such as playing with my smartphones. I wastefully spent so much time checking what people are doing on Instagram and Facebook. I decided to delete my social media application such as Instagram from my smartphone, so I won’t get distracted and use my time to be more productive. I wish I am more willing to work hard just like my dad. I believe by doing so, I can become successful just like he does. That’s the reason why I try spending more time writing quality article contents and create value and share my thoughts for my readers to read during my spare time. I hope that I can overcome my laziness and be willing to work on the plan that I map out so that my blog can actually be successful and create alternative income for me in the future. Remember, without the willingness to work hard, you won’t go anywhere and stay where you are with just hope and dream.

6. They Live Below Their Mean
I think this is a crucial trait that anyone need to follow in order to become a millionaire. In order, to become one, you’ll need to be discipline with yourself to not get attached in trying to “keep up with Joneses” and live below your means. What I mean by that is not to worry about what other people’s life style, the cars they are driving, or the beautiful home they recently purchase. Self-made millionaires don’t want to achieve financial independence in order to be able to buy more stuff; instead they want the financial freedom. Remember the way you spend your money can determine your future financial success. Some people don’t mind to work hard and have all their hard earned money spent on things they might not even need. Always remember that to be wealthy, you are required to build the source of your passive income. There are studies that show that most millionaires were living below their means long before they had any substantial amount of wealth. By committing to those frugal habits and planning ahead from the beginning of their early life is a large part that made them a millionaire. In order to be wealthy, you’ll need to get out of the rat race that prevents you from building wealth.

Billionaire Mark Cuban shares his story before he became wealthy. He mentioned how he was living with several roommates in a small apartment and eating ketchup sandwiches in his twenties so that he was able to save up money. That’s the commitment wealthy people have in order to become rich. They are willing to make these types of commitment that most people are not willing to. The reason why most people don’t get wealthy for they are not willing to make the sacrifice in order to become the millionaire they want to be. Living below your mean doesn’t mean that you have to keep eating only ketchup sandwiches like Mark Cuban, but to be willing to make more monetary sacrifice in order to live the life you dream in the future. In addition,
Warren Buffett who is my idolized investor lives a life that is way below his mean. He was very savvy with managing his wealth and smart with the way he spends his money. This result him to be one of the wealthiest man in the world, and a philanthropist who has his money donated for charity purpose. By living below your mean enable you to save more money. The additional cash saved can then be used towards your investment. Remember, the earlier you start to save and make your money work for you, the better financial result you will attain. The power of compound interest works best when you start investing early in life.

I personally think that I’m good at following this trait of living below my mean. Since at young age, my mom always taught me to be a smart spender. She inspired me to not waste money on unnecessary things and purchase things when it’s on sales. I’m really proud of my mom with her economic spending habits. Even though my dad is wealthy, my mom doesn’t spend much money on unnecessary things. Instead of spending on useless things, my mom uses the money my dad gave her every month to be invested in assets that generate income for her. It was because of my mom’s teaching and conservative spending habit; I developed the characteristic to not be wasteful and able to have the delay gratification mindset just like her. For instance, even though my car is beater car (a car that is 10 years or older), I know that by me purchasing a brand new one is just wasteful. A car depreciate in value overtime and can affect your financial goal towards early retirement. Even though I know my car is old and not fancy, seeing my friends to have newer and nicer car didn’t make me want to follow what they are doing. I am willing to keep driving my current car for a longer period. The car I’m currently driving provides the functionality that I need for me to commute to work. When I am financially ready, I might then want to purchase another car, my dream sport car that I would use on the weekends. In addition, my mom also taught me to good at finding value for the money. For example, I can wait patiently for an item such as a watch that I like to buy until it’s on huge sale before purchasing it. I know that the watch will be on sale when the stores have season sales. In result, I was able to get the watch I wanted for 50% discount from the original price just by waiting for a few months more before buying it. It might sound silly to be able to save a few bucks here and there. However if you accumulate all the savings you made on purchasing things, it can add up to a tremendous amount of money that can be invested.    

7. They Are Never Afraid of Failure and Never Dwell on Past Mistakes
One trait of a millionaire or someone who is wealthy is that they are not afraid of failure. Successful people aren’t born destined for success. This is a one major trait that makes someone who is a millionaire different from the rest of the world. They view their failure differently. Most non-millionaires view failure as a stop sign that they have to stop going further and dwell on the unfortunate event. Millionaires sees failure as an encouragement to be smarter next time and to avoid the same mistake, and keep going ahead that will eventually lead them to their goal. Failure is an opportunity to learn and grow. In another word, those who allow failure to conquer their dreams in pursuing the goal will likely never reach that millionaire status. Millionaires view failure as a path or the way to success. Any journey to success will come with obstacles; that’s just a part of life. But whether or not you allow those setbacks to stop achieving the dream you wanted is really up to you. You can either be stuck with the unfortunate event, or you can choose to move on and focus on the end-goal of your journey to become wealthy. The choice is a decision for you to choose. If you ask anyone who is successful regarding on how encountering failures, they would say it’s something you have to experience and worrying too much about it, is not worth. 

When I asked my dad about his journey to success whether he encounter obstacles. He replied to me that it’s part of the journey and shouldn’t demotivate you to keep going. He mentioned how many mistakes he encounters during his journey. He was able to be the person he is today because he uses these mistakes as a learning experience to make better decision in the future. If my dad was demotivated to keep going when he failed, our family won’t be where we are today. It was because my dad who is constantly trying to figure out a way to solve the problem he encounters during the journey. Being able to solve the problem and failure, he was then able to keep going and become successful. He sees mistake and failure as part of the journey, and he became more experienced and has the knowledge to overcome these problems. A person can’t be successful if he never encounters failure or mistakes. It’s just impossible; the road to success will come with the obstacles that require hard work and dedication to solve it. Overcoming failures will make you become a stronger and smarter person.

One great example of a tragic event in my dad’s journey to wealth is when his business was dramatically affected by the financial crisis in South East Asia in the 1998. At that time, my dad was 49 years old; my dad experienced huge financial lost during the economic downturn. During this period of time, many businesses in Indonesia went bankrupt. My dad and many other Indonesians were not able to do any business, but luckily he had savings that enable my brother and me to continue our education overseas. Even though my dad was stressed out about the future at that time; he didn’t stop from moving on and finding solution to make money. If it wasn’t for his hard work and dedication to be successful, my brother and I would not live the comfortable life today. I’m grateful that my dad had sacrificed so much in order for the family to stay afloat.   

After learning the experience that my dad went through, it makes me realize that my failures are not the end of the world. It’s just something that I have to overcome to become a successful person. Even in the path of my stock investing journey, I went through many investment mistakes that made me lost money. Taking advice from my dad made me realize that failures were learning experience for me to learn and how to overcome those problems, so that I won’t make the same mistake in the future. As my age is still pretty young, I still have many opportunities to become successful just like my dad. It makes me to not be afraid of mistakes and find solution to solve it when I encounter one. I’m glad and fortunate that I have role model like my dad that can guide me to one day become wealthy on my own.

8. They Don’t Trade Time for Money (Multiple Streams of Income) 
Anyone who seeks to become a millionaire must understand time is valuable commodity. You will never be wealthy if you don’t manage your time properly. Millionaires understand that they must focus on creating consistent income without trading time for money. Warren Buffett mentioned that “if you don’t find a way to make money while you sleep, you will work until you die”. This is where multiple stream of income comes in. Most millionaires will tell you that they earn and grow their wealth through multiple stream of income. They don’t focus in one source of income such as their current job, but to create alternative sources of income that can come passively. They want passive income coming in their pocket without having to sacrifice their time for the money. This doesn’t mean that you shouldn’t work hard or quit your current job to create wealth. What I mean by this is that you want to build a business or investments portfolio that you can work early in life, and have them generate profits (or dividends) in the future. Millionaires use their talent, resources and power to create opportunities for a more dynamic income. It’s true that your current job might pay you high salary, however if you stop working, you won’t have the salary coming in to your pocket anymore. Just relying on your job is difficult to create wealth when you are someone else’s employee. Instead, you want to use your capital (or other people’s capital) to create more wealth. If you’re serious about becoming a millionaire, start searching on other options aside from your current job. It could be in a form of side hustle income like starting a blog, and find ways how to earn passive income to start increasing your income sources.

I think this is a technique used by many millionaires. They don’t rely in one source of income that might require exchanging their time for money. For instance, aside from working in my dad’s company, I try to seek ways I can increase my sources of incomes (alternative incomes). That way if I decide to quit my current job, I still have other alternative income coming in. Some great example of multiple stream of income that I’m building is my finance blog which I’m trying to monetize with Google AdSense. I want to create content articles in this blog, so that in the future the blog can generate passive income for me without me having to sacrifice my time. Yes, I know that I needed to put hours into writing quality content article now, but when the blog is established (have many articles) in the future; it will be able to generate traffic by itself. This gives me the advantage of earning passive income when visitors come in to my blog to read the contents I have written. Google Adsense will then pay me money when the visitors visit my blog as well as click on the Ads that are placed in my blog. Moreover aside from blogging venture, I also invest my monthly savings into my dividend growth portfolio as well as managing my parent’s property that I rented out. These passive incomes enable me to receive money in forms of dividends and rental income. I am currently still building my dividend growth portfolio using dividend growth and value investing strategy. The portfolio will grow in value when the prices of stock appreciate in value and dividend increases from the stocks I’m holding. From the dividends I receive from my portfolio, I am able to reinvest the dividends into more dividend paying stocks, enabling the power of compound of interest to create a snowball effect. In the future, I hope my dividend growth portfolio and rental property can keep continuing to pay me the passive income without having me to exchange my valuable time for money. These are just some examples of what I’m currently working on to increase my passive income from different sources. 

To Summarize
After reading this article, I hope you readers have a better understanding of the traits that millionaires or billionaires have in them. Majority of them didn’t become wealthy from inheritance or luck. Instead, they have traits and principles that they follow in order for them to become the person they are today. By learning the traits of millionaires can help you have a better understanding how they did it. I myself am always curious of how to become wealthy. By having a big dream and positive mind set let us to think outside the box. Millionaires and wealthy people are always hungry for knowledge to broaden their financial opportunity. You are required to continue improving yourself to become successful. In addition, a great plan and making the steps towards your financial goal is crucial. This way you are able to strategize your path to wealth. Besides planning the path, dedication and hard work are equally important. Without you not wanting to work hard and be lazy won’t accomplish the goal you are trying to achieve. It’s useless planning and strategizing, if you are not going to take the action to your plan. Furthermore, living below your mean enable you to save capital for investment or opportunity that can multiply your wealth. It’s pointless if you spent all your hard earned money into useless things that can’t grow in value. Moreover, the path to success and wealth will encounter obstacles that you need to face. Making mistakes or past failures will make you grow to become more experienced and knowledgeable. So remember not to dwell on the mistakes and failures you overcome during your journey. Learn from them and move on to focus on your goal. Last but not least, build ways to make alternative income
so that you don’t have to trade in your time for money. Millionaires always figure out ways to have multiple of incomes coming in so that they don’t have to rely on their current job salary. Learning the traits of millionaires can help you understand how they become wealthy, and I hope you can apply these traits to your journey of building wealth.

1 comment:

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