Across the U.S., approximately 13.6 million people now have a net worth of at least $1 million dollars — which is an increase of about 283,000 from last year. What’s more, the trend is gaining steam, with an estimated 18 million folks projected to join the 7-figure ranks by the year 2021.
Naturally, many of these millionaires live in Bel Air, Tribeca, and Miami Beach. However, a surprising number of them are residing in middle-class neighborhoods and choosing to drive a Toyota Corolla or Honda Civic instead of a Lexus LS or Audi A8. Yes, that’s right: that ordinary, regular, run-of-the-mill guy or gal next door who asks you to collect their mail while they’re on vacation could have more money in their coffers than 99% of people in the country. Or make that, the planet.
So, what do these millionaires-next-door know that most folks don’t? Here are 7 amazing facts that helped them enter the 1% club:
- They spend significantly less than they earn and are shrewd about saving money. For example, instead of spending over $10,000 to paint their cars, they spend a few thousand to get brilliant car wraps in St. Louis, Boston, New York, or wherever they happen to live.
- They relentlessly focus on paying off their mortgage, because nothing snuffs out the pursuit of wealth faster than loans with amortized interest (i.e. when a small portion of debt payment is allocated to principal, and the rest is eaten up by interest).
- They strategically use credit cards vs. get used by them, and they always pay the full balance. Basically, they believe that if they cannot pay for something in cash, then they can’t afford it.
- They don’t just focus on saving. They also focus on generating more money by, for example, getting training and certifications that increase their earning potential and leverage in the job market.
- They do not willingly spend time with people who are either reckless with money, or who are miserly with it. They understand the law of proximity: hang around four legitimately wealthy people, and you’ll likely be the fifth.
- They have a financial plan that adjusts to their lifestyle, age, and other factors. With this in mind, they are not immune from making financial mistakes. But when this happens, they learn from the experience and develop their plan vs. waste time and energy playing the blame game.
- They do not “keep up with the Joneses”. They are happy when people around them succeed, and feel no compulsion to participate what basically amounts to an arms race with toys instead of weapons.
The Bottom Line
There are more millionaires than ever before, and your neighbor might well be among them. Keep this in mind the next time you dream about moving into a gated-community mansion with a garage full of supercars. By adopting the tips and mindsets above, you might be perfectly fine staying where you are, yet enjoying a level of financial freedom that transforms your life in many ways that you can imagine — and in more ways, than you cannot!
