Self-Made Millionaires Have Their Eggs in Many Baskets

“Keep all your eggs in one basket, but watch that basket closely.” Warren Buffet

This is one of Warren Buffet’s most famous quotes. It is also one of the worst pieces of advice for anyone who is working on becoming rich. My father took Buffet’s advice without knowing it and in one night lost everything when his main warehouse for his business burned down. My dad had most of his wealth tied up in his business. We were considered wealthy at the time of the fire. My dad’s business was valued at around $3 million, which is north of $20 million in today’s dollars. We lived in a very nice house in Todt Hill, one of the most affluent neighborhoods on Staten Island. When my dad’s warehouse burned to the ground, all of that wealth disappeared into thin air. Our family struggled financially for the next 15 years, trying to recover from that nightmare; struggling almost daily to prevent foreclosure on our home. My dad told me later in life that he wished he had his eggs in more than one basket. That would have been the smart thing to do, he told me.

In my study of the daily habits of the rich and poor, I learned that most self-made millionaires generated their income from many baskets:

  • 65% had three streams of income
  • 45% had four streams of income and
  • 29% had five or more streams of income. Having multiple income streams makes a lot of sense.

When one stream is negatively affected by systematic economic downturns, of which you have no control, the other streams can come to the rescue and help you survive the downturn, without dramatically affecting your lifestyle.

Some famous examples of this multiple income stream principle at work include:

  • Ashton Kutcher – In 2009, Kutcher invested some of his Hollywood cash on Skype when it was valued at just $2.75 a share. Microsoft recently purchased Skype for more than $8 billion, making Ashton enormously wealthy.
  • Arnold Schwarzenegger gets most of his current income from real estate investments he made prior to becoming a famous film star.
  • Warren Buffet – Ironically, due to the diverse nature of the investment portfolio held by Berkshire Hathaway, Buffet actually is invested in 15 different industries. That’s a lot of baskets kicking off a lot of income streams.

Most people are not rich. And coincidentally, most people have one stream of income – their job. If you do not save and invest your savings in assets that generate additional streams of income, and you lose your job, you could soon find yourself living with a relative. Putting all of your eggs in one basket is simply a recipe for financial disaster. If you put all of your eggs in one basket and that basket breaks, what do you do?

How do you create multiple streams of income?

  1. Save, Save, Save – Save 10 – 20% of your net income every year.
  2. Expand Your Means – Start a side business or side career that generates additional income.
  3. Create Multiple Baskets – Invest your savings and additional income into investments that generate passive income such as: residential rental properties, commercial rental properties, TICS, triple net leases, seasonal rentals (beach areas, ski resort areas, lake front areas), equity investments (stocks, bonds, mutual funds), annuities, permanent life insurance, royalty-generating property (timber, oil and gas), boat rentals etc. If you can’t do it on your own, partner with others and keep building your portfolio of assets that generate passive income.

As I mentioned, three streams of income seems to be the magic number for the self-made millionaires in my Rich Habits study, but the more income streams you can create in life, the more secure will your financial house be.


Be Sociable, Share!
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.
Email Tom
| Download Media Kit


  1. I couldn’t agree more with having your eggs in more than one basket. This is one of my requirements when it comes to my husband and I retiring to our dream destination of Sedona AZ. We need to have possible passive income from stocks, real estate and side hustles. This way if something happens we have fall backs. It’s good to know I have millionaires to reference as examples why 🙂 Thanks!

  2. Matt Jensen says:

    That is not a Warren Buffet quote. It is an Andrew Carnegie quote, from the book “Think Your Way To Wealth”.

  3. As I’ve been working through the book, I’m understanding that changing my own mindset is the most significant difficulty.
    Acquiring time flexibility isn’t really a lot a matter of finding a
    method to make money with very little time investment– there appears to be plenty of way to do that.
    It’s really about the procedure of liberating myself
    from my own deep-rooted concepts about the
    relationship between time and money.Judging from the success of this blog site and the
    book, I’m not the only one battling with this.
    Thanks for leading the way, Tim.LikeLike

  4. This is very inspiring. If you really want to earn millions you really work hard for it. But Working hard doesn’t mean working in a day job. You can actually earn amply (passively) through stocks, affiliate marketing and blogging.

Speak Your Mind