Recent research shows only around 9% of the US adult population are millionaires. So unless you were born to a rich family, wealth building can be difficult. But it’s worth noting that almost 90% of these millionaires are self-made, meaning they were not born into their wealth. So how did they make that much money?
There are mainly 4 paths self-made millionaires take to make their 7 figures.
KEY OUTLINE
- Saver Investors
- Corporate Climbers
- Professionals
- Risk Takers
Saver Investors
The first one is probably the easiest and almost guaranteed way to become a millionaire – The Saver Investors. Saver investors are those who become millionaires by consistently saving and investing money. They usually earn a middle class salary, and live frugally. They typically start saving and investing 20% or more of their income early on in their working life, and consistently doing so throughout their entire career.
The key to their success is low cost living and consistently putting all money saved to retirement accounts and relatively safe investments like index funds and real estate.
Average saver investors could be your next door neighbours who are unremarkable from the outside, but actually quite well-off in their bank accounts.
Here is a recent deep-dive video I made to show how saver investors can become millionaires earning below-average salary.
Corporate Climbers
The Corporate Climbers. They are the high-achievers in most corporations who thrive for promotions with bigger titles and more generous packages. They manoeuvre between delivering company missions and office politics, ultimately ascending to the executive level where most of their fortunes are made.
Key corporate skills such as communication, leadership, operational excellence and interpersonal skills are essential to their success.
They are usually the leaders of their teams, faces of their companies, speakers in corporate events and jet-setters who live the glamorous corporate dream.
Tim Cook from Apple, Sundar Pichai of Google, Satya Nadella from Microsoft are the top examples of successful corporate climbers.
The Professionals
Then there are the professionals. In this context, the professionals are the experts in their particular field, who are highly compensated for their deep knowledge and expertise in a competitive and usually complex domain.
These professionals usually spend years learning the knowledge, and decades mastering their expertise, establish industry reputation and become one of the best in their field.
Lawyers, doctors, engineers, financial market traders or even competitive gamers are all in this bracket. Established members in any of these fields command an annual salary well into 6 digits.
The Risk Takers
Last but not least, the risk takers. Risk taker millionaires are those who made their fortunes by participating in high reward low probability endeavours. They could be entrepreneurs and business owners in the business world, YOLO investors in the financial market, actors and musicians in the entertainment industry, athletes in sports, or even professional poker players and sports bettors in the gaming industry.
Many of the risk takers spend years perfecting their craft while toiling without a steady paycheque, and yet only few of them would become successful in their field.
Besides having a certain level of talent and hard work, a high tolerance to uncertainty and a lot of luck are usually key contributors to the success of risk takers.