Smart Money Training Program

Topic 2.5: Habits of the Wealthy

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We will learn about some surprising facts and habits of the wealthy.

Learning from those who have Money

In this section, we will explore some surprising facts about millionaires, including how most of them acquired their wealth, and the common traits and behaviors they share.

If you want to get better at something, you learn from those who have already succeeded or from others who have studied the best paths to attaining that goal.

• To excel in a sport, you study other top athletes. 

• If you want to be great at a career, you learn from people at the top of their fields.

• If you want to learn how to manage your money and gain wealth, you should learn from those who have become wealthy themselves.

This is why we study millionaires – to learn how they achieved their success and what many of them have in common.  And as we will learn, the path to becoming a millionaire is quite different from what most people expect.

What is a millionaire?

A millionaire is someone with $1 million or more in Total Net Worth. It is not someone who has a million-dollar salary (although many are also millionaires).

Net Worth is the value of all your assets (your investments and what you own) minus all your liabilities (your debts, loans, and what you owe).
 

If you subtract your liabilities from your assets, you get your net worth.

Being a millionaire doesn’t necessarily mean you are rich, and as we will learn, many millionaires live very modestly.  However, being a millionaire is certainly a sign that you are managing your money effectively and on a strong path to retire with comfort.

What Most Millionaires Have in Common

Many people believe that millionaires are wealthy because they have inherited money, earned very high salaries, or taken significant financial risks.

However, the studies have shown that most millionaires have built their wealth gradually through everyday habits and consistent choices.

Key facts about millionaires:

• Nearly 80% did not inherit money

• Most are first-generation wealthy, meaning they started with little or no wealth

• Many earn under $100,000 per year

• They often live in modest homes and avoid flashy lifestyles

• Common careers include teachers, engineers, accountants, and managers

• Wealth is built through steady saving and investing slowly over time

How Millionaires Handle Money Day to Day:

• Spending less than they earn

• Saving consistently, especially in retirement accounts

• Avoiding unnecessary debt

• Buying used cars and keeping them longer

• Shopping carefully (using coupons, discounts, and thrift stores)

• Avoiding risky investments and get-rich-quick ideas

Personal Traits That Support Wealth-Building:

• Taking responsibility for their financial choices

• Setting clear goals

• Staying focused and intentional

• Working hard and staying consistent over time

Millionaires usually follow Simple, straightforward Financial Plans:

• They create a clear roadmap for their financial goals

• They work steadily toward those goals, stay focused, and avoid distractions.

• No complicated strategies - just patience and persistence.

What Millionaires Often Do Not Do:

• Buying brand-new, expensive cars

• Spending money they don’t have

• Carrying high-interest debt

• Making impulse purchases

• Chasing instant gratification

• Trying to impress others by spending

Millionaires – Quick Summary:
Millionaires live below their means and make thoughtful choices with their money.

In a nutshell, millionaires work hard, live modestly, avoid debt, save consistently, and repeat for several decades.

It’s boring. But it works!

Remember the Key Takeaways:

• Most millionaires did not inherit their money, had high paying jobs, or took big financial risks.

• Millionaires live below their means, save consistently, and make thoughtful choices with their money. 

References:

Hogan, C. Everyday millionaires: How ordinary people built extraordinary wealth — and how you can too. Ramsey Press, 2019.