Cashola

Self-Made Millionaires’ Secrets

A couple months back, there was an article written by Kristyn Kusek Lewis for Reader’s Digest that discussed the “Secrets of Self-Made Millionaires“. This article has been discussed and featured in other personal finance blogs but felt the concepts are timeless and offers lessons to be learned by all (especially me):

1. Set your sights on where you’re going.
You must think BIG and have a vision of what you would like to achieve. Envisioning your goal and wholeheartedly believing that you can achieve that goal is half the battle. Remember, “A journey of a thousand miles beings with a single step”. Know where you want to go, and do whatever it takes to get there.

2. Educate yourself.
Those uneducated about personal finance and investing often find themselves in bad debt, living from paycheck to paycheck, and without enough money to live comfortably when they retire. Read books, magazines, websites, blogs, forums, etc. etc. etc. on personal finance. The information is all there, you just have to use it.

3. Passion pays off.
While everyone wants to make as much money as possible, most do so at the expense of pursuing their true passion. A large portion of those who are successful do what they love. Pursue your dreams and the money will follow. Taken directly from the article: “According to research by Thomas J. Stanley, author of The Millionaire Mind, over 80 percent of millionaires say they never would have been successful if their vocation wasn’t something they cared about.”

4. Grow your money.
Pay yourself first! Instead of spending money on useless or unnecessary things, invest that money in yourself. It’s imperative you do so. Whether it’s your IRA, business, or investments, put that extra money where it will work for you.

5. No guts, no glory.
This speaks for itself. You must take risks if you want to achieve everything and anything you ever dreamed of. Investing and risks go hand in hand. The same goes for putting aside a secure stable job that you hate for pursuing one that you’re passionate about. Successful people are not concerned about failure. The only thing that counts is the payoff. Achieving their goal. Thomas Edison said it best: “I have not failed. I’ve just found 10,000 ways that won’t work.”

The Biggest Secret
STOP SPENDING! Every millionaire has one common denominator: they do not spend needlessly. This is a very important concept to understand. Some of the richest people spend their money with a middle-class mind-set. Clip coupons, wait for sales, buy used, check craigslist and ebay for items - Do whatever it takes to stop spending needlessly and spend intelligently on items you do need. When you stop spending, the more money you have to invest. Here are a couple examples taken directly from the article:

Talk show host Tyra Banks calls herself the Queen of Cheap and keeps perfume samples from magazine ads in her purse for quick touch-ups.

Sara Blakely, founder of the $100 million shapewear company Spanx, gets her hair trimmed at Supercuts.

And Warren Buffett, the third richest person in the world, according to Forbes, lives in the same Omaha, Nebraska, home he bought four decades ago for $31,500.