Becoming a millionaire is something that most of us dream about at one time or another. We look at those with large amounts of wealth and wonder how they got there, and more importantly, we wonder how we can get there as well. The road to wealth requires patience, but the steps needed to get there are relatively simply. If you want to know how to become a millionaire, simply study and follow the instructions below, and financial freedom will (semi) soon be yours.
1. Change Your Mindset
A negative mindset – what I like to call a “lack” mindset – is, in my humble opinion, a primary roadblock to achieving wealth or anything else. If you consistently view yourself as poor, you will both consciously and subconsciously make spending decisions that deflate your net worth.
The subconscious “What’s the use? I’ll always be broke.” message will leave you thinking short-term satisfaction regarding your spending decisions instead of thinking and making spending decisions that are in line with your long-term goal.
Start viewing yourself as a wise person who does have the knowledge (get it if you don’t have it) to build wealth and loves themselves enough to make smart money decisions conducive to building wealth, and the net worth increases will soon follow.
2. Commit to Continuing Education
If you’re truly interested in becoming a millionaire, turn off the TV and start educating yourself on how millionaires live, and what things they did and do that got them to millionaire status. Millionaires and other successful people live differently that 95% of the world: that’s why they have more money and success than 95% of the world. Start educating yourself on how they live life and make decisions; then choose to learn how to think like a millionaire.
3. Develop a Written Plan
If you’re serious about becoming a millionaire, it’s important to take the time and write down your plan to get to millionaire status on paper. After educating yourself about millionaires and how they live, work and invest, develop your own plan and write down the steps you’ll take to go from your current financial situation to Mr. or Ms. Millionaire. Decide what you’ll do, what you’ll stop doing, what you’ll sell and what you’ll buy that will increase your net worth (discover your net worth using Personal Capital, a free online tool). Put a solid, smart financial plan in place and then follow the plan.
4. Stop Buying Depreciating Assets
Broke people, in general, have a habit of buying only depreciating assets. Instead of investing in real estate, they buy new cars. Instead of investing in index funds, they go to the casino. Instead of using windfall monies to increase their net worth by paying off debt or investing, they use the money to go on vacation. None of the above-mentioned things are bad in and of themselves, but a habit of buying depreciating assets as opposed to appreciating assets will surely squelch any chance of reaching millionaire status.
5. Start Living Below Your Means
Pick a percentage – any percentage – of your income, and make that your new income, putting the rest into investments or savings. Simply start living on, say, 90% of your income and pretend the other 10% doesn’t exist. Then use that 10% to make wise investment choices that fit your investing style. It won’t be long before you are quite used to living on less and won’t even realize that the 10% is missing from your budget. In the meantime, that 10% will be working to make you a millionaire.
6. Start Viewing Your Dollars As Employees
Instead of viewing your money as something you have to play with, start seeing your dollars as employees. You can keep them and employ them to work for you, growing your wealth, or you can fire them (i.e. spend them) and have less employees to grow your business – the business of becoming a millionaire. A smart business person works to grow and expand their business in order to provide future success. Be a smart business person and use your dollars as employees whose job is to help you build your wealth through smart investing.
7. Refuse to Conform
In the Bible there’s a verse in the book of Romans that reads “Do not be conformed to this world, but be transformed by the renewing of your mind, that you may prove what is the good, acceptable, perfect will of God.” When it comes to reaching millionaire status, it’s important not to be conformed to this world. The majority of this world believes that keeping up with the Joneses and showing off their success with “stuff” is the right way to achieve success, when in reality, their accumulation of depreciating assets is destroying their chance of becoming a millionaire. Don’t make that mistake and fall into the pack of “follow the leader”. Instead, pave your own road to financial freedom and show others how to follow you.
8. Learn How to Make Passive Income
There’s nothing like passive income to help you along on your way to reaching millionaire status. When you put your money to work for you in a way that requires little to no maintenance on your end, you’re free to find other ways to make money or free to simply enjoy life. Educate yourself on smart ways to make passive income and implement passive income ideas that fit into your lifestyle and your passions and watch your bank account grow.
9. Choose to Persevere
Anything worth having is worth waiting for. Your road to millionaire status will likely come with roadblocks and setbacks. Unexpected expenses will occur. Investments will lose money. Your job might change. Accept that these setbacks will occur, and when they do, choose to dust yourself off, get back up and try again. As the old saying goes: There is no failure except in no longer trying (Elbert Hubbard, an American writer, and publisher). Choose to keep trying, in spite of the setbacks, and millionaire status will come.
10. Regularly Analyze Your Plan
Life changes, and so your plan to become a millionaire must be open to change as well. Analyze your millionaire plan on a quarterly or semi-annual basis. Determine what’s working, what isn’t and what needs more time to see if it’s going to pan out. Reflect on how your goals and your life have changed during the last several months and see what adjustments need to be made if any, that will fit your current lifestyle and still help you reach your goal of millionaire status.
Learning how to become a millionaire does take time, but as so many have shown, it is a possible dream. For those willing to make the necessary sacrifices, implement a smart plan and persevere through the waiting, millionaire status is absolutely achievable.
What’s a big goal you’re working on currently? What is your advice for those wanting to become millionaires?
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