Millionaire Mindset Life

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Millionaire Profile

Self-made millionaires fall into three distinct groups:

1. The Savers


The first group of self-made millionaires saved their way to wealth. 

These Savers accumulated their wealth by living below their means, saving money, and then investing that money prudently. This path to multi-millionaire status is the longest path and takes about 30+ years.

Savers typically were risk averse, employed most of their lives, earned a moderate wage, and had a low or moderate standard of living.

Self-made millionaire Savers are the least wealthy of the three groups.

Being a Saver is the risk-averse way to building wealth. It’s the safe path to wealth accumulation. However, it requires discipline, sacrifice, and attention to detail in order to live below their means, save, and invest.


2. The Executives


The second group of self-made millionaires work for large, publicly held corporations. 

Through hard work, smart office politics, constant self-improvement, and powerful relationship-building skills, they rose up the ladder in their respective companies.

As executives, they received higher than normal compensation, which always included bonuses and stock compensation.

This stock compensation was in the form of one or more of the following:


Qualified stock options

Non-qualified stock options

Stock rights

Restricted stock

Outright stock grants


The stock compensation was always disproportionate to their base compensation, meaning, significantly higher than their base pay. This stock compensation was responsible for generating most of their wealth.

It takes this group about 25 years to accumulate their wealth.


3. The Entrepreneurs


The third group of self-made millionaires are the entrepreneurs.  

These are individuals who started their own business. This group accumulates the most wealth in the shortest time span,  an average of 12 years.

Entrepreneurship the highest risk and hardest path towards building wealth.  Most self-made millionaire entrepreneurs fail at least once in business.  

The upfront investment in time and money was significant.  They invested most, if not all of their time, money and energy in something with no guarantee of success.

But when successful, the journey transformed their lives and the lives of their families. It forced them to develop new skills, acquire new knowledge and learn how to find and build relationships with other outstanding, success-minded people.




Who is the prototypical American millionaire? 


*The prototypical American millionaire is fifty-seven-year-old male, married with three children. About 3/4 earn 80 percent or more of the household’s income.


* About one in five is retired. About two-thirds who are working are self-employed. Interestingly, self-employed people make up less than 20 percent of the workers in America but account for two-thirds of the millionaires. Also, 75% who are self-employed consider themselves to be entrepreneurs. Most of the others are self-employed professionals, such as doctors and accountants.


* Household’s total annual realized (taxable) income is $131,000 (median, or 50th percentile), while average income is $247,000. Note that those who have incomes in the $500,000 to $999,999 category (8 percent) and the $1 million or more category (5 percent) skew the average upward.

* Average household net worth of $3.7 million. Of course, some have accumulated much more. Nearly 6 percent have a net worth of over $10 million. Again, these people skew the average upward. The typical (median, or 50th percentile) millionaire household has a net worth of $1.6 million.


* On average, total annual realized income is less than 7 percent of wealth. In other words, live on less than 7 percent of the wealth.


* Most  (97 percent) are homeowners. Live in homes currently valued at an average of $320,000. About half  have occupied the same home for more than twenty years. Meaning, most have enjoyed significant increases in the value of their homes.

* Most have never felt at a disadvantage because they did not receive any inheritance. About 80 percent are first-generation affluent.

* Most live well below their means. Many wear inexpensive clothes and drive American-made cars. Only a minority drive the current-model-year automobile. Only a minority ever lease any motor vehicles.


* Most have a “go-to-hell fund.” In other words, they have accumulated enough wealth to live without working for ten or more years. Those with a net worth of $1.6 million could live comfortably for more than ten years. Actually, longer than that, since at least 15 percent of earned income is saved.

* As a group, most are fairly well educated. Only about one in five are not college graduates. Many hold advanced degrees. Eighteen percent have master’s degrees, 8 percent law degrees, 6 percent medical degrees, and 6 percent Ph.D.s.

* As a group, they believe that education is extremely important for themselves, their children, and their grandchildren. Most spend heavily for the educations of their offspring.

* About two-thirds work between forty-five and fifty-five hours per week.

* Being an investor is important.  On average, most invest nearly 20 percent of household realized income each year. Most all invest at least 15 percent. 79 percent of have at least one account with a brokerage company but make their own investment decisions.

* Nearly 20 percent of the household’s wealth is in transaction securities such as publicly traded stocks and mutual funds. Most rarely sell equity investments.  More is held in pension plans and on average, 21 percent of  household wealth is in private businesses.

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