Rich Habits Poor Habits | Myths about the Wealthy Part 1

In Tom Corley’s five-year Rich Habits study of 233 rich people and 128 poor people he discovered that we adopt the beliefs of our parents, family, mentors, culture, and environment.

He shares some of those revelations and dispels the myths about the rich.

In this week’s video we discuss 4 myths about the rich.

These include:

MYTH #1: RICH PEOPLE INHERITED THEIR MONEY

“Old money”.  

That’s what Tom used to hear growing up.

The rich were rich because of old money.

Boy, is that a myth.

In his study, 82% of the wealthy did not inherit anything.

Nada, zip, zero.

In fact, 76%, or 177 of the wealthy in his study, were self-made millionaires.

31% came from poor households and 45% came from middle class households.

Only 24% of the rich in his study were raised in wealthy households.

MYTH #2: RICH PEOPLE DON’T HAVE TO WORK HARD

According to Tom's Rich Habits study, one of the reasons the wealthy accumulated so much wealth was due to the fact that they worked more hours than those who were not rich.

Here’s some of the data:

* 44% of the wealthy worked 11 hours more each week than the poor.

* 86% of the wealthy who had full time jobs, worked 50 hours or more each week, whereas 57% of the poor who had full-time jobs, worked less than 50 hours each week.

* 88% of the wealthy took fewer sick days than the poor.

* 79% of the wealthy, on top of their extended work hours, networked 5 or more hours each month. 55% of this networking was done during their lunch hour.

* 65% of the wealthy were working so many hours, in part, because they had 3 sources of income to manage. 45% had 4 sources of income. Only 6% of the poor had more than one source of income.

* 67% of the wealthy watched less than an hour of T.V. a day, whereas 77% of the poor watched more than an hour of T.V. a day.

* 63% of the wealthy spent less than an hour a day on the Internet. 74% of the poor spent more than an hour a day on the Internet. 

He initially thought this disparity in work hours, between the rich and the poor, was in large part due to the fact that 91% of the wealthy in my study were decision makers, which carries with it more responsibility and, thus, more work hours.

But that’s not the case.

According to the Census Bureau, the average wealthy household (defined by the IRS as the top 20% of income earners in the U.S.) worked five times as many hours as the average poor household.

The cause?

Single-parent households and high unemployment among poor households.

MYTH #3: RICH PEOPLE PAY LESS IN INCOME TAX THAN EVERYONE ELSE

According to the IRS, the income tax rate for the top 1% of earners in the U.S. is 22.83% whereas, the top 50% of income earners in the U.S. pay 14.33%.

The bottom 50% of income earners in the U.S. pay just 3%.

The top 1% of income earners in the U.S. pay 45.7% of the entire 100% of income tax collected by the IRS.

1% are carrying nearly 46% of the tax bucket for the other 99%.

If anyone can make a case about the unfairness of our tax system, it’s the rich.

MYTH #4: THE RICH ARE RICH BECAUSE THEY JUST GOT LUCKY 

Only 8% of the self-made millionaires in my study said they accumulated their wealth because of random good luck.

92% said random good luck had nothing at all to do with their wealth.

While this 92% acknowledged that luck was a factor in the accumulation of their wealth it was a different type of luck that they called “Opportunity Good Luck”.

This is a unique type of luck that is the byproduct of their hard work, persistence and habits.

This 92% never quit.

They never gave up.

Even when they failed, and 27% failed at least once in business, they picked themselves up, figured out what went wrong and tried again.

You can catch up with past episodes of this weekly webcast here – Rich Habit, Poor Habits – Tom Corley & Michael Yardney

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RICH HABITS POOR HABITS EPISODE 24 | COMMON HABITS STOPPING PEOPLE FROM GETTING RICH PART 2

RICH HABITS POOR HABITS EPISODE 23 | COMMON HABITS STOPPING PEOPLE FROM GETTING RICH PART 1

RICH HABITS POOR HABITS EPISODE 22 | WHAT DOES IT TAKE TO BE SUCCESSFUL PART 2

RICH HABITS POOR HABITS EPISODE 21 | WHAT DOES IT TAKE TO BE SUCCESSFUL PART 1

About Michael Yardney Michael is the founder of Metropole Property Strategists who help their clients grow, protect and pass on their wealth through independent, unbiased property advice and advocacy. He's once again been voted Australia's leading property investment adviser and one of Australia's 50 most influential Thought Leaders. His opinions are regularly featured in the media.