October 2000

 

Do You Want to Be a Millionaire?
Cynthia Crawford, crawfordc@missouri.edu

If yes, should you:

1. Book a flight to New York and call 1-800-REGIS
2. Play tribal games while you’re starving on a deserted tropical island
3. Buy a lottery ticket
4. Learn about "Millionaire’s Mindsets"
5. Learn the basics of saving and investing and then put them to work to build your net worth

This article will focus on answer D and next month’s article will focus on answer E.

Dr. Thomas J. Stanley, with the assistance of the Survey Research Center, Institute for Behavioral Research at the University of Georgia in Athens, studied 733 United States households with at least $1 million in net worth. His findings are reported in the book The Millionaire Mind (Andrews McMeel Publishing: Kansas City, 2000). Dr. Stanley begins, "What I learned from them (733 millionaires) was simple, yet the message had a lasting impact on me: You cannot enjoy life if you are addicted to consumption and the use of credit."

Most of the people in the study became an economic success in one generation. They came from economic ground zero. Most inherited no money. They never received the proceeds of an estate or income from a trust account. How did they do it? Stanley asserts that they have a millionaire mind.

You may never be able to generate the sizable incomes that many of these millionaires have earned (or even want to). You and I, though, can benefit from understanding how these people maintained an enjoyable lifestyle at the same time they were accumulating wealth. Only 4.9% of households in this country have a net worth of $1 million or more.

What are some of the common characteristics of those in the study?

• Comfortable, not extravagant lifestyles.
• Not particularly trendy when it comes to selecting homes and neighborhoods. Most had small, if any, outstanding balances on their home mortgages.
• Almost all are married and have children. Most believe that having a family complements, not competes with, the process of building wealth. The typical couple in the millionaire study group had been married for 28 years.
• Not into "do-it-yourself" tasks.
• Became rich without compromising integrity. In fact, they credit their integrity as significantly contributing to success.
• Not workaholics. When they work, they work hard. They spend a lot of time socializing with friends and family, as well.
• Time is spent planning investments and consulting with tax advisors.
• Wealth building is an active process. "Not one millionaire I interviewed had anything nice to say about gambling," pointed out Stanley. Where does the element of luck rank? Near the bottom of the list of success factors.
• They do value courage and the courage to take reasonable financial risks.
• While they are well educated, most had a B average. They were not at the top of their classes.
• Live sensibly. 70% regularly have shoes resoled and repaired. 70% make a shopping list before going to the grocery store. Half reupholster or refinish furniture rather than buying new. Half buy household supplies in bulk at warehouse stores.
• Most had been told by some authority figure or by the results of standardized test scores that they were:
• Not intellectually gifted
• Not of law-school caliber
• Not medical-school material
• Not qualified to pursue an MBA degree
• Not smart enough to succeed.

What are the top factors most often mentioned by millionaires as being very important in explaining their economic success? If you’re like me, you’ll be surprised.

1. Being honest with all people

2. Being well disciplined

3. Getting along with people

4. Having a supportive spouse

5. Working harder than most people

6. Loving my career/business

7. Having strong leadership qualities

8. Having a very competitive spirit/personality

9. Being well organized

10. Having an ability to sell my ideas/products

11. Making wise investments

12. Seeing opportunities others do not see

Dr. Stanley found a number of actions and thought processes used by millionaires to eliminate/reduce fears and worries.

1. Hard work
2. Believing in myself
3. Preparation
4. Focusing on key issues
5. Being decisive
6. Planning
7. Being well organized to deal with big issues
8. Taking immediate action to solve problems
9. Countering negative thoughts with positive ones
10. Outworking, outthinking, out-toughing the competition
11. Visualizing success

Never allowing fears to control my mind.

 

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