One of the most revolutionary and groundbreaking discoveries I made in my five-year Rich Habits Study, was the fact that there are Four Paths to Wealth.
I cover these paths in more detail in my new book, Effort-Less Wealth, but here’s a snapshot:
- Saver/Investor Path
- Big Company Climber Path
- Virtuoso Path
- Dreamer/Entrepreneur Path
What makes this discovery so revolutionary is that it means everyone and anyone can become rich.
That there’s not one way to become successful and wealthy.
There are multiple ways.
And why is that so important?
It’s important because we are all different.
We all have different personalities, different genes, different innate talents, different strengths and different weaknesses.
Because you now know that there are so many paths to becoming wealthy, your job becomes so much easier – you just need to figure out which path is the right path for you.
How do you know which path is right for you?
Each path has its own unique personality profile, demands and success habits.
I’ve covered the personality traits unique to each path here: Do You Have the Right Personality to Become Rich?
In this article, I’ll cover the Demands or Requirements of each path.
When you understand the demands of each path, it becomes easier to identify the right path for you.
Requirements to be a Saver-Investor Multi-Millionaire
Middle-Class Income – It’s hard to save when you are poor. Most of the poor are barely able to meet the costs of even a low standard of living.
But, if you have a middle-class income and keep your standard of living low, this will give you the ability to save.
Discipline – The typical Saver-Investor saves 20% or more of their income and lives off what’s left.
This requires discipline in saving first and discipline in minimizing how much money you spend.
Consistency – Saver-Investors consistently save and consistently invest their savings so that their wealth can grow consistently.
Time – It takes an average of 32 years for a Saver-Investor to accumulate their wealth.
Requirements to be a Big Company Climber Multi-Millionaire
Long Work Hours – Climbers have to work long hours.
Most Climbers have to travel regularly.
Airports, hotel rooms and taxis become a way of life.
And very often, Climbers have to work during weekends and on vacations.
Political Expertise – Besides the hard work, Climbers must possess expert political skills.
Those who do are able to outmaneuver their internal competitors – other Climbers, biting at their heels and stabbing them in the back, as opportunities present themselves.
There is always some other Climber seeking to undermine you in order to advance their personal agenda, which is usually the same as yours – climbing further up the company ladder.
Power Relationships – Climbers need mad relationship-building skills.
Those who succeed in reaching the upper echelons of a big company are almost certainly the best at building relationships, both within the organization they work for and within their industry.
Building these strong, powerful relationships, however, takes time, energy and money.
Frequent phone calls, constant entertainment, attending weddings, birthday parties or funerals and sending thoughtful cards for special occasions.
Just managing all of those Power Relationships takes up a big part of their workday.
Risk – The Climber Path has some unique risks.
If the company struggles financially, for whatever reason, your time investment in that company may not be rewarded, to the extent you expected.
- Also read:6 priceless investing lessons from influential billionaires
- Also read:Redefining Richness: Why Time Matters More Than Money
- Also read:Conquer Your Monsters: Busting the Top 10 Fears Holding You Back
- Also read:Booms, busts and investor psychology – why investors need to be aware of the psychology of investing
- Also read:10 BIG Benefits of setting up an SMSF or a Family SMSF
Acquisition Risk is another risk.
Your company can be acquired and you could find yourself out of a job very quickly.
Requirements to be a Virtuoso Multi-Millionaire
Significant Investment – Becoming a Virtuoso requires an enormous investment in time, and often money.
Knowledge-based Virtuosos spend many years in continuous study.
Oftentimes, this requires formal education, such as advanced degrees (PhD, Medical Degrees, Law Degrees, etc.).
Skill-based Virtuosos devote themselves to many years of deliberate practice and analytical practice.
Deliberate practice requires thousands of hours honing your skills.
Analytical practice requires the services of a coach, mentor or expert who can provide immediate feedback.
This feedback, in most cases, costs money.
Long Hours – Like the Dreamer and Climber, the Virtuoso has to work long hours, not only in perfecting their knowledge or skills, but also in maintaining and using them.
Virtuosos are rare and, therefore, in high demand.
That high demand means many long hours serving the needs of others in exchange for money.
Requirements to be a Dreamer-Entrepreneur
Long Work Hours – The Dreamer-Entrepreneurs in my study worked an average of 61 hours a week, for many years, especially in the early years of their entrepreneurial journey.
Weekends and vacations were infrequent.
Those long work hours impact everyone in the Dreamer’s immediate orbit.
Family and friends are hit the hardest by their absence.
Often one spouse must take up the slack and raise their children, as if they were a single parent.
Close friendships are on the vine, due to those long work hours.
Financial Stress – Until the Dream begins to pay off, making ends meet can cause almost intolerable stress.
Only the strong can survive that stress and that includes the spouses.
In the early going, getting a steady paycheck is near impossible.
Weak marriages will almost certainly fall apart, due to this stress.
High Risk – Dreamers have to put everything they own on the line.
Their homes, retirement plans, and savings become the assets that breathe life into their Dream.
When a Dreamer runs out of assets, they have no choice but to turn to debt in order to continue to finance their Dream.
The lucky ones are able to secure Lines of Credit to keep them afloat.
The unlucky ones are forced to rely on credit cards or loans from family and friends to survive until they thrive.
If they thrive.
Pursuing a Dream is a gamble.
There’s absolutely no guarantee that the Dream will ever pay off.
Many fail.
In fact, 27% of my Rich Habits Study failed at least once.
Failure can mean bankruptcy.
Sometimes bankruptcy is followed by divorce.
