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Knowing “who” millionaires are, and what characteristics they have in common, can help you make decisions in your own financial life. How old are they? Are they married? What’s their income like?
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But now, I want to talk about how they did it because we had a common misconception, Brian. Both of us, growing up, were taught by our families that wealthy people are just born into it. It’s a class thing, like if you have money, it must be because your parents had money and passed it down. But then we read “The Millionaire Next Door” and started seeing the studies, and it sounded like maybe that’s not the case. Maybe that’s not actually where wealth is generated.
Yeah, I grew up with that being told to me, that those rich folks have all the breaks and advantages. That whole “if I can’t do it, they must have some advantage.” But when you see the research and you see consistently, it’s around 80 percent, 80 percent of millionaires are first generation. And when we looked at our own research, 74 of our clients have not received an inheritance greater than $10,000. Now, look, I even think if we push this because I was telling Daniel, you know, my father passed away when I was in my mid-20s, I don’t come from money. But my dad did have like a $100,000 life insurance policy, and my mom gave me some money, gave my brother some. She couldn’t afford it. I mean, she really wasn’t a good decision, but it was just one of those moments of grief. So, I would have to check here that I received over $10,000, but it was not what created my success. So, I think that this number is actually probably even higher, probably closer to that 80 percent you see from all the other sources. But it was very much confirmation that a lot of our clients are first-generation success. But this also, look, let me give you a cautionary tale. This means that wealth is very cyclical, meaning that by the time the kids inherit it and then the grandkids, it is gone.
So let’s make sure not only do you use this to motivate yourself that it can happen for you, but also make sure you teach your children well. I love it. And so then we asked this question, now we’ve talked about, we’ve done a number of shows on our paths to wealth, you know, are you an entrepreneur or are you a virtuoso, someone who’s super talented, or are you a corporate executive? How did you get there? What was your path? And so, we asked this question of our population. Sixty-nine percent of our respondents said, “Hey, the way that I got to millionaire status is not just to save and invest. I wasn’t a super high-paid senior executive. I didn’t go start some business, or I wasn’t born with some talent where I can do a sport better than someone else or sing better than someone else. I was just consistent through time. I saved and I invested, and I saved and I invested. I did that over a long time period, and it worked out pretty well for me.” Oh man, I mean this is music to my heart when I see that the saver-investor is still the dominant. Because there’s so much noise out there telling you, you can’t create success. Use this data to show you, “Yes, you can.” I mean, if you just take a little bit of today and put it and defer it for that tomorrow, that great big beautiful tomorrow, you’re going to have success that just will create tremendous opportunity. Now, we would have been silly if we asked our millionaires all these questions about what you do and how did you do it and all this kind of stuff and we didn’t ask some of the questions. Hey, what would you do differently if you could go back or if you could tell your younger self something? What’s the thing that you would tell them that would help them on their journey? What’s the thing that young people need to know to be able to move towards this? I want to see if there’s a theme here, so I had Daniel just type in a few of these. These are direct quotes, so just go ahead and let’s read a few of these.
So here’s the first one: start early. Well, here’s another one: start early. Here’s another one: save more. Starting to catch on? Start saving early, start as soon as you can. Save, save, save. Save more, save more, start saving more sooner. I think it’s quite interesting. I didn’t see anybody in there say they wish they would have saved less. I wish I would have lived it up more. I didn’t see anybody in there who said, “Man, I’m so glad I bought a bunch of life insurance products when I was in my 20s and 30s.” I mean, just that stuff was not in there. It was all about just do it, just make something. I don’t care if it’s $50 a month. I want you to listen to this message: start as soon as possible and start building your wealth. And again, don’t let this be something like, “Oh well, I didn’t start when I was 20.” Okay, great, start today. Sometime in the future, starting today will have been starting early for you. So don’t put it off.
So then we asked this question. This was one of the other touchy-feely questions. We said, “What are some of the biggest misconceptions the public has about wealth?” And I thought these were great responses. Here’s the first one: that it’s out of reach for the average person. In other words, being wealthy, achieving wealth, is available to everyone. It’s available to the average person. Preach! I mean, that’s because that’s the biggest one. I love it. We had multiple versions of that first point. I took the easiest one when we were creating the slides, which is, “Do not let somebody tell you you can’t do this.” That’s just poison because we’ve seen it over and over. It is definitely in reach for the average person if you can just use the component of discipline.
How about this one? Here’s a big misconception: there’s a shortcut or an easy or a quick path to wealth. It’s more about making smart decisions with what you have and gradually building it up. So there’s not some get-rich-quick way to do it. You just have to be consistent and do it over time, and you’ll be amazed at the results. Yeah, I mean, you have to be careful in the social media world. So many people are out there selling stuff, talking about life insurance or crypto or even courses. Look, I know we do courses, but we also have the entire abundance cycle where we want you to come learn, apply, grow. The free content that we give through these podcasts that are simple, I mean, index funds, just investing in that, the law of accelerating returns, how humans are just growing, innovating. You can be part of that and create your path to wealth too. I love it. Then look at this last one. They said that you can’t end up with a larger retirement account if you don’t make a lot of money. And this person basically said, “Hey, people think that in order to be able to retire, in order to be financially independent,
In order to be financially independent, in order to be able to live the life that you want on your terms, you’ve got to have a huge income, you’ve got to make tons of money. He said that’s a misconception. It doesn’t require a huge income, it requires a huge amount of discipline or even just a little discipline if you have a huge amount of time. And if you can do that, there’s nothing that stops you, whoever you are, wherever you are listening from, from also being on the other side of the wealthy equation.
I think investors, people who understand, they start early enough, they’re shocked when you actually look at the makeup of your account and you say, “How much was what I contributed? How much is just from the growth and compounding?” If you started in your 20s, you’re going to find that somewhere between 90 to 95 percent of your account value at retirement is going to come from not what you put in but from the growth. I mean, that is the beauty of compounding growth, guys. Leverage that. You don’t have to have a big income, you just have to have the discipline to make the process happen. This is one of my favorite traditions. I love sharing what we learn. Use this as the jumping-off point for you to get motivated and start building your wealth as well. For more information, check out our free resources here.
