One of the characteristics I most admired in my study of self-made millionaires, was their confidence. At first, in the early days of my five-year study of the rich, I considered confidence a prerequisite, an inherent characteristic, that all successful people must have had prior to realizing success. But I was wrong. Confidence, I learned, was a byproduct not a prerequisite.

It takes courage to pursue your dreams and the goals behind those dreams. Courage, because the pursuit of a dream is very risky. In the beginning, nothing goes right. Mistakes, pitfalls, setbacks and obstacles are ever present in the lives of those who pursue a dream. In the early going, the pursuit of a dream feels like you are at war. Every day is a new battle to overcome mistakes, pitfalls, setbacks and obstacles. But those mistakes, pitfalls, setbacks and obstacles force you to learn what to do and what not to do. You grow. You evolve. You learn. And that growth, evolution and learning becomes the foundation upon which those who pursue their dreams build their foundation for success. The more mistakes, pitfalls, setbacks and obstacles you are able to overcome, the sounder that foundation. Success, it turns out, is built upon a mountain of mistakes, pitfalls, setbacks and obstacles. The more mistakes, pitfalls, setbacks and obstacles you are able overcome, the higher your mountain.

True success is defined by your ability to overcome the mistakes, pitfalls, setbacks and obstacles that you encounter during your success journey. Each time you overcome them, you gain confidence. Confidence grows with each victory. And the more confident you become, the more certain you become that you will ultimately succeed. That confidence then fuels you with optimism and enthusiasm and you gain more courage along the journey. You begin to believe in yourself like never before. You begin to believe that you can overcome any mistake, pitfall, setback or obstacle that life throws at you. And those challenges lose their power over you. They no longer intimidate or frustrate you. Confidence, it turns out, is an acquired trait. One acquired during the journey towards success.

Self-made millionaires do not “work”, they produce outcomes. One after another. A goal is nothing more than the pursuit of an outcome. We create outcomes by engaging in activities that tap into our inner talents, our inner genius.

Each human being has certain gifts, certain inner talents they are born with. Those few who are able to unearth their inner talents, excel in life. These rare individuals focus their energy on developing their talents and applying those inner talents to produce outcomes that benefit society in some way.

Unfortunately, our education system has succeeded in shifting the focus of education from identifying and unleashing each individual’s inner talents with the need to learn certain basic skills that do nothing but prepare individuals for a job. We have been systematically reprogrammed from creators into machines.

When we are not using our inner talents we are unhappy. Most individuals are unhappy in the work they do. According to a 2012 survey conducted by “Big 4” accounting firm Deloitte, 80% of those surveyed did not like their jobs. In another survey conducted by Gallup in 2013, 63% of the 230,000 employees in the survey said they were unhappy with their jobs.

The self-made millionaires in my study have succeeded in bucking the system. Somehow these individuals were able to break free of the systematic programming to earn a living, to creating a life of meaning. They pursued things in life that they were interested in and passionate about. That is their legacy.

If you want to succeed in life you must buck the system. You must find your inner talents. There’s a process. I’ve written about it often. It’s called Dream-setting. When you Dream-set you create a blueprint of your ideal life. Inside that blueprint you will find your inner talents, the preprogrammed greatness that exists within each individual’s DNA. When you tap into your inner talents you cease being a machine. You become a creator, focused on creating outcomes rather than a paycheck.

At some level we all desire to be financially successful. Financial success solves many of life’s problems. Being financially successful means you no longer have debt, you no longer worry about paying your monthly bills and you don’t need lenders to finance major purchases like cars, homes or college education for your kids. Financial success means you no longer have to “work” at a job you do not like or are not passionate about. At it’s core, financial success is all about freedom.

But financial freedom comes at a cost. For millions, that cost is a lottery ticket – the short-cut to financial success. But for self-made millionaires, there are no short-cuts. Creating financial success is a process and that process comes at a cost far more significant than a lottery ticket. That cost often involves giving up the good for the great.

Jim Koch, co-founder of Boston Beer Company, left his $250,000 a year consulting job in 1984 to pursue his passion – building a business around his family’s beer recipe. Everyone around him, including his father, advised him against it. Despite the many entreaties from his family and friends, Jim made a fateful decision to give up the good in pursuit of the great. Today, Jim is worth in excess of 1 billion dollars.

Over the past sixteen plus years I have devoted all of my available time to studying the differences between the rich and the poor. One thing I’ve noticed, one correlation, one common thread, is that at some point, the self-made millionaires in my study made a decision to give up the good to pursue the great. That almost always involved taking a risk by leaving their current job and going all in on something they were passionate about.

When we leave the good for the great, we invariably must step outside our comfort zone. That’s not an easy thing to do. And because it’s not an easy thing to do, very few do it. That’s why there are so few self-made millionaires. The average person is simply unwilling to give up what they have, the good, in order to pursue something great. Fear and limiting beliefs holds most back from pursuing the great. If you want to be financially successful, to be free from financial worries, you must give up the good for the great. Or, do what millions of unsuccessful people do – buy a lottery ticket.

It’s hard to change a habit. According to a famous 2009 study conducted by University College London, it took anywhere from 18 to 254 days to change a habit, depending on the complexity of the behavior forming the habit. The more complex the behavior, such as washing your face verses swinging a golf club, the more time it took for the habit to form. Unfortunately, willpower depletion will derail most from habit change, and force you back into old habits, routines and behaviors.

If you are truly disgusted with your life, and desperately want to change your life, what can you do? Well, I have some good news for you. There’s a lazy man’s path to habit change that requires almost no effort at all and it’s backed by scientific research into habit change. In 1921, 1,500 bright children were tracked for more than 80 years in a massive longitudinal study conducted by psychologist Lewis Terman. Terman and his successors collected millions of details about these subjects. Psychology professors Howard S. Friedman and Leslie Martin hen spent 20 years analyzing Terman’s research data and wrote a book about it called The Longevity Project.

According to this research, if you want to change your habits, all you have to do is find some new friends. It turns out, habits are contagious. They have a ripple effect, spreading like viruses, through every person within our inner circle. Exercise, weight loss, weight gain, drinking, reading, smoking and even happiness habits are infectious. If you spend time with different people, you will become a different person. You will be infected by their habits.

This is the very reason why Weight Watchers is the most successful weight loss program around. It’s also why Alcoholics Anonymous is so successful. When you regularly associate with certain people, you become infected by their habits, behaviors and thinking. The people you associate with on a regular basis unconsciously affect your behavior in many ways, both positively and negatively. This is why you should choose your friends, coworkers and relationships very carefully. If they have habits that create an exceptional life, eventually you will become infected by those very habits. Our associations dictate the life we have. Make sure those associations are exceptional.

Cell phones continuously ring, beep or notify us of incoming calls, messages, appointments and reminders. Email has its various noises. TV noise is all around us at home, in airports, in gyms and waiting rooms. Sirens, horns, people talking.

To some extent, the brain is able to shut out the noise. But that takes effort, which consumes brain fuel, and eventually wears us out. After a day of noise we can find ourselves exhausted, without really understanding why.

Worse, all this noise distracts us from focusing on our tasks and pursuing our goals. If you want to succeed in accomplishing your goals and ultimately realizing your dreams, you need to shut down the noise.

On a recent episode of Follow the Leader, Farnoosh Torabi interviewed John Paul Dejoria, the co-founder of Paul Mitchell Systems and Patron Tequila. Dejoria admitted that he did not use email because he felt it would be too much of a distraction. Dejoria, in fact, avoids computers entirely so that he can focus on building his billion dollar empire.

While Dejoria is an extreme example of successful individuals who shut down the noise, there are certain strategies I uncovered in my five-year Rich Habits study that millionaires use to help them tune out the noise of life:

• Early morning isolation for 2-3 hours – Wake up 2-3 hours before your workday begins and find your quiet place to get things done. Those things should be directly related to your goals and dreams.
• Turn off your email – Many of the self-made millionaires in my study ignored their email for most of the day. They blocked off 30 – 45 minutes twice a day to check and respond to email. Otherwise, they just ignored it.
• Don’t answer the phone – Same logic as with the emails here. Block off time during the day to respond to and make phone calls. Otherwise ignore your phone most of the day.
• Wear ear plugs or noise cancelling headsets – I have become an ear plug enthusiast. Wearing ear plugs at night allows me to get a good nights sleep. Wearing ear plugs during certain parts of the day when I need to really focus, helps to drown out the office noise. I’ve noticed more and more people, especially on airplanes, wearing those noise cancelling headsets while they get some work done on the plane ride.
• Find your quiet place – Recent neurological studies on peak performance found that the brain cycles every 90-120 minutes. After this timeframe, the brain tires and operates inefficiently. Researchers found that a 20 minute rest break after each 90-120 minute cycle restores the brain’s normal functioning. Rest breaks could be a simple as a 20 minute walk, closing your eyes, or putting those ear plugs in for 20 minutes while you recharge.

If you’re a beach person like me, you’ll understand my metaphoric title. On many beaches, in order to get to your spot on the beach, you have to trudge through a seemingly endless duration of scorching hot sand, carrying your umbrella, chairs, cooler and many other things. If you don’t properly prepare yourself for the pain by wearing flip flops, sneakers or shoes, that journey through the hot sand towards the cool ocean can be almost unbearable.

The success journey is a lot like that journey towards the ocean. You have to endure the pain of the success journey in order to realize success. That pain includes obstacles, pitfalls, mistakes, failures, rejection, indifference by influential people and the roller coaster of emotions that make the journey almost unbearable.

Most, unfortunately, never make it to their spot on the beach. They underestimate the pain of the journey. As a result, the scorching hot sand is simply too hot for them to handle. So, they quit, oftentimes right before they succeed. 

The few who do succeed, are able to because when the pain does come, they are prepared for it. The key to realizing success, is not tolerating the pain of the journey towards success, but preparing for it. You must expect obstacles to be in your way. You must expect pitfalls. You must expect mistakes and failures. But above all, you must expect the journey to be a long and painful one. So when those who succeed encounter the hot sand along their path, they’re ready for it – they bring along their flip flops. Being prepared for the pain enables you to focus on one thing and one thing only – getting to your spot on the beach.

As many of you know, I ‘m big on binders:

• Fact Binder
• Mistake Binder
• Book Binder – This is a binder where, in 1-2 pages, you summarize the key points of every book you read.

I literally have 5 of these binders at my feet in my home office that I use almost every day to help me along the way in my success journey. I can’t take the credit for the idea, however. About a dozen of the self-made millionaires from my Rich Habits study gave me the Binder idea.

There’s another Binder idea I’d like to share with you called the Vision Binder. This is a binder that includes pictures of all of your dreams: your future home, future vacation home, future vacation destinations, future goals (pictures of goals you hope to achieve one day), future awards (awards you hope to win one day), future relationships (famous people you hope to get to know one day), etc.

The beauty of the Vision Binder is that you can continue to fill it and refer to it, day after day, without worrying about running out of room. Vision Boards are bulky and limited in terms of space and not very practical. Building your Vision Binder is a fun thing to do. Plus, every time you add something new to it, it immediately puts you in a positive mindset. You get happy, optimistic and enthusiastic every time you open it. Your personal, customized Vision Binder will keep you focused on your dreams and goals. It will keep you motivated and inspired. It will shift your mindset from negative to positive every time you open it. Start your Vision Binder today. Add it to your arsenal of success tools.

In my Rich Habits study, one of the data points I found interesting was about gossiping. 94% of the wealthy avoided it vs. 79% of the poor who engaged in it regularly.

I never thought much about gossiping until my research. Since then I’ve learned quite a bit about it from numerous studies. Here are some startling stats that I uncovered in my research on gossiping:

• 90% of workplace conversations are gossip.
• 15% of workplace email content is gossip.
• 60-70% of gossip is negative – Gossip is 2.7 times more likely to be negative.
• Gossip irreparably damages relationships.
• Gossip causes chronic stress.
• Engaging in gossip, either by communicating it or listening to it, flips your mindset from positive to negative.
• 60% of gossip is judgmental.
• Gossip often destroys reputations in the workplace.

Spontaneous trait transference, also known as the Boomerang Effect, is a phenomenon where people are perceived as possessing a trait that they describe in others (Hovland, Janis and Kelly, prominent psychologists, first recorded and named the boomerang effect in 1953). Telling others that your friend is lazy will cause them to infer that you are lazy. Those who engage in regular gossip, most of which is negative, are inadvertently creating negative perceptions of themselves. It’s one of those Poor Habits I talk about frequently that act like an anchor, dragging you down and creating a life of misery. 

No good can come from gossiping, which is predominantly negative. It not only damages the reputations of those you gossip about, it also has a boomerang effect, damaging your own reputation. Like many behaviors, it’s a habit that must be broken if you hope to succeed in life. Awareness is the key to changing any habit. When you find yourself engaging in gossip, stop and change the subject immediately. Or, only engage in positive gossip, which is a Rich Habit. Good gossip, saying something positive about someone when they are not around, will make others like you. They will unconsciously assume that you will say nice things about them to others as well.

My wife has a lot of friends. More friends than anyone else I know. I find it counterintuitive because she seems to demand a lot from her friends in the form of favors. But, she always reciprocates, meaning, it’s never one-sided. What amazes me the most is that my wife will ask someone she just met for a favor right out the gate and, of course, eventually reciprocate.  

These two habits my wife has forged have long intrigued me. I didn’t understand how or why they helped her in building strong relationships until I embarked on my obsessive study of daily habits many years ago. There are actually two psychological phenomenons at play, I discovered.

The Franklin Effect

The Franklin Effect is named after one of the most famous founding fathers in America –  Benjamin Franklin, who used it as a relationship-building tool. It has now become an accepted method for building strong relationships. Here’s how it works:

If you want to get someone to like you, either ask them for a small favor or perform a small favor for them. 

For some strange reason, human beings like doing small favors for each other. 

The Law of Reciprocity

The Law of Reciprocity states the following:

If you do a small favor for someone they will feel obligated to reciprocate.

The rich people in my Rich Habits study all seemed to have one thing in common – they had a lot of relationships. 88% had 200 or more relationships. Conversely, 95% of the poor people in my study had less than 200 relationships. When I dug deep into the reasons for this dichotomy, that’s when I discovered that the rich people in my study were using the Franklin Effect and the Law of Reciprocity for relationship building. As a result, these two tools became part of my arsenal of Rich Habits, which I obsessively write, talk about with the media and teach to millions around the world.

My wife, without knowing it, was employing both tools to build her enormous number of relationships. And many of the wealthy in my study, like my wife, were completely oblivious to their use of these two relationship-building tools. My wife had picked up these tools from her Dad and then turned them into lifelong habits. This is not uncommon. Most of the habits the wealthy had forged in life came from their parents as well.

Less than 5% are raised in families where parents teach their kids the Rich Habits. We are most definitely not all on equal footing when we step foot onto the adult stage. Those who have the Rich Habits have at their disposal certain habits or tools, like the Franklin Effect and the Law of Reciprocity, thanks mostly to their parents. This enables them to cut through their competition, like a hot knife through butter, accumulating millions of dollars along the way.