Three Types of Self-Made Millionaires


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In my five-year Rich Habits Study, I interviewed 177 self-made millionaires. I am often asked by the media how they got rich.

Essentially, my self-made millionaires fell into three distinct groups:

The Savers

The first group of self-made millionaires in my study saved their way to wealth. These Savers accumulated their wealth by living below their means, saving money and then investing that money prudently. According to my Rich Habits research, this path to multi-millionaire status took about thirty-two 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 were among the least wealthy in my study, with an average net worth of $3.4 million.

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

The Executives

The second group of self-made millionaires in my study worked 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, irrespective of its form, 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 took this group about twenty-five years to accumulate their wealth.

The Entrepreneurs

The third group of self-made millionaires in my study were the entrepreneurs – individuals who started their own business. This group, by far, accumulated the most wealth, averaging $7.4 million over an average of twelve years.

This was the highest risk and hardest path towards building wealth. In fact, 34% of the self-made millionaire entrepreneurs in my study failed at least once in business, which took a toll on their families and their lives.

The upfront investment in time and money was significant.

The early part of the journey for the typical entrepreneur was one fraught with nothing but uncertainty.

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

Despite their best efforts, things often went wrong. In the beginning, there was an endless parade of setbacks, obstacles and mistakes.

With every misstep, doubt was a constant companion. These doubts fill their waking moments and invaded their dreams.

Peace of mind was hard to find. Uncertainty sucked the life out of them. It often drained them of their confidence and every setback caused them to wonder if it was all worth it.

It took superhuman resilience to survive the entrepreneur’s journey.

But 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.

Those who were able to survive the journey and succeed, became millionaires and found happiness and fulfillment awaiting them on the other side of their journey.

There’s no easy path towards accumulating wealth and becoming a self-made millionaire.

Saving your way to wealth is the least stressful and least risky path towards accumulating wealth, but it requires enormous discipline and sacrifice.

Climbing the corporate ladder to wealth requires unique skill-sets and more than a little bit of luck. Finding a publicly held company to work for is easy. Finding one that is in a growing and expanding sector where profits and share price are consistently rising requires some luck.

Being an entrepreneur is perhaps the hardest way to accumulate wealth. The ups and downs, characteristic of entrepreneurship, requires enormous emotional control, long work hours, persistence, resilience, focus and the ability to rebound from mistakes and failure.

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Thomas C. Corley About Thomas C. Corley

Tom Corley is a bestselling author, speaker, and media contributor for Business Insider, CNBC and a few other national media outlets.

His Rich Habits research has been read, viewed or heard by over 50 million people in 25 countries around the world.

Besides being an author, Tom is also a CPA, CFP, holds a master’s degree in taxation and is President of Cerefice and Company, a CPA firm in New Jersey.
Phone Number: 732-382-3800 Ext. 103.
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