As the world works its way through the confronts of the Covid related economic issues, lockdowns, and health challenges, one thing has become clear.
The rich keep getting richer. They seem to do this through pandemics, through good times and bad.
And this has led a lot of people to ask why? How? What do they do differently?
That’s what we’re going to discuss in today’s Rich Habits, Poor Habits episode of the Michael Yardney podcast.
Even if you come here to learn about property, success, or money, at the end of today’s show you’re going to understand some new research that Tom Corley has uncovered which should help you in your future endeavours.
There are four predominant paths toward accumulating wealth. The “Savers-Investors” path is the easiest, while the other three involve much more risk.
Just less than 22% of the millionaires in Tom’s study chose to take the Saver-Investors path. Not only is it the easiest way to build wealth, but if you start early, it almost always guarantees a lot of money.
The Saver-Investors had four things in common:
- A middle-class income
- A low cost of living and preference for saving to save
- A habit of saving 20% or more of their income.
- An early start to investing their savings
This is perhaps the hardest path to building wealth because it requires the pursuit of a dream, such as starting a business, becoming a successful actor, musician, or author.
Approximately 28% of the folks in Tom’s study were Dreamers, and they accumulated an average net worth of $7.4 million — far more than any of the other groups — over a period of about 12 years.
Those who want to take this path, however, must be willing to work long hours and able to handle financial stress.
The Dreamers in my study worked more than 61 hours per week before finally achieving their dreams. Weekends and vacations were almost non-existent.
Climbers are individuals who work for a big company and devote all of their energy to climbing the corporate ladder until they land a senior executive position.
This is the second-hardest path to becoming a millionaire, and about 31% of the rich people I studied fell into this group.
It took them an average of 22 years to accumulate a net worth of $3.4 million or more.
In most cases, their wealth came from either stock compensation or a partnership share of profits.
To be a Climber, you must have strong relationship-building skills. Networking and making lasting connections with powerful people in your industry are essential.
Roughly 19% of the participants in Tom’s study chose this path. Virtuosos are among the best at what they do in their profession.
They are paid a high premium for their knowledge and expertise, which sets them apart from the competition.
It took the Virtuosos in my study about 20 years to reach an average net worth of $4 million.
Some worked in the medical field, while others worked in law.
A handful either worked for large, publicly-held corporations, or they were small business owners with highly profitable enterprises.
Links and Resources:
Get your own copy of our international bestseller Rich Habits Poor Habits
Some of our favourite quotes from the show:
“I think something we should remind people is that most millionaires weren’t born that way.” – Michael Yardney
“Entrepreneurs often have to count their pennies carefully in the early days.” – Michael Yardney
“You need resilience, because you’re going to have troubles, you’re going to run into challenges, there are always going to be hurdles.” – Michael Yardney
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