According to a 2017 survey by GoBankingRates, 29 percent of Americans believe they will become millionaires in their lifetime. As with other parts of the world, it remains a dream to most people, especially for those who have to start from nothing. Not everyone who wants to be wealthy acquires the discipline to achieve that target in their lifetime.

This gap between the desire to be wealthy and reality creates interesting questions. What do the rich know or do that the rest of us don’t? Are there secrets to generating and maintaining wealth? If not, why do so many people spend a lifetime believing they will become wealthy but never become? In search of the secrets to wealth, you will be shocked that there are no secrets. Even the books written about secrets don’t have any secrets. It’s the simple money habits that most people disregard that make the difference.

Most people in a lifetime earn more than a million dollars but never become wealthy. Their financial habits separate them from the cash immediately; it gets into their accounts. Learning from those who have made it can save you many mistakes and get you to the success you desire quickly. The rise of self-made millionaires is enough proof that anyone willing to learn and live by these simple habits can realize their financial independence goals.

Below are the ten financial habits of successful people in the following categories:

  • Income
  • Savings and expenditure
  • Investments

Income Habits

  1. They Invest in their career or skills to increase income.

The majority of financially successful people have a higher than average income. But, notably, this hasn’t always been the case. Most self-made millionaires started with moderate incomes. So, how do they increase their income over time? They understand the importance of investing their time, energy, and resources to grow in the career or skills that will bring them more returns. They stay on top of their game in their chosen field.

For instance, Amazon founder Jeff Bezos’ first job was as a McDonald’s fry cook, and his salary then was $2.69 per hour. The position prepared him well for the entrepreneur he became. Today, he is one of the richest men in the world.

This aligns with one of the remedies for wealth creation outlined in the book “The Richest Man in Babylon”.

“Increase thy ability to earn- cultivate thy powers, to study and become wiser, you need to become more skillful, to so act as to respect thyself.”

2. They have more than one stream of income.

Most financially successful people don’t rely on one income source. Apart from their job or business, they invest in other assets. John, who runs a personal finance blog, interviewed 100 millionaires, and 62% reported having at least one more income stream.

3. Most earn through entrepreneurship.

When it comes to making money for the wealthy, most have amassed their wealth through entrepreneurship. Even those who have acquired wealth through corporate jobs admit that owning a business is a better strategy for wealth creation.

Entrepreneurs dominate the list of the world’s wealthiest people, for instance, Bill Gates, and Mark Zuckerberg. The list comprises people from all over the world operating in different industries, but entrepreneurship is the most noticeable trend. This doesn’t mean opening a business will lead to wealth, and neither does it suggest that it’s simple.

 Spending and Saving Habits

Regarding expenditure and savings, the classic book of personal financial advice, “The Richest Man in Babylon” by George Clason, recommends that you:

  1. Pay yourself first. A part of all you earn is yours to keep.
  2. Manage your expenses -learn to plan your expenditure so that you may have money for your needs, fun, and gratification without using the saving percentage.

A high income alone cannot guarantee wealth if the finances will not be managed to support wealth creation. There is no correlation between high income and wealth. Wealthy people understand this and align with this classic advice, as detailed below.

4. They pay themselves first.

Most people who are struggling financially or living paycheck to paycheck save what is left after spending and paying bills, but this is not the case with the wealthy.

Wealthy people determine their financial goals and save for the first, pay bills and spend what is left. It can be easier to assume that because they make higher than average incomes, as mentioned earlier, it’s easy for them to work that way. Studies and surveys conducted to the affluent show that no matter the pay, saving has always been a habit. Promising yourself that you will start saving first when you get a particular increase in income or getting a second job only delays your financial success journey.

5. Frugality

The Millionaire Next Door by Thomas S. and William D. is probably the most comprehensive study carried out in America to discover who the wealthy are and how they became.

According to the book, frugality is one of the most shared spending traits among the wealthy. They are frugal. Take caution not to confuse frugal with cheap. The opposite of frugal is wasteful.

A wasteful lifestyle is that of high consumption and lavish spending. This is what is typically broadcasted as being rich—a lavish lifestyle. The reality with the type of people leading such a lifestyle is that they are high-income individuals and can only support that lifestyle if they keep working and earning high. Wealthy people, on the contrary, value financial independence more than displaying a high consumption lifestyle. They don’t have to show that they have it if it’s only for the show. This is probably one of the shocking habits millionaires have, they are expected to spend lavishly and show they have it, but most don’t.

Warren Buffet is a clear example of this. He has been living in the same house he bought in 1958 for about $31,000. He is not even ready to consider owning homes in every state. When it comes to luxury items, he refuses to buy something that will drain his accounts.

6. They buy their cars and plan to keep them long-term.

More than 80 percent of the millionaires studied by T. J. Stanley as well as W. D. Danko in “The Millionaire Next Door” purchase their vehicles and keep them for many years. They are not in a rush to own the current year’s model for showing off. They don’t buy using a car loan and also don’t lease.

 Investment and Debt Habits

The investment advice by George S. Clason of the timeless personal finance read “The Richest Man in Babylon” is:

  • Multiply your finances- let every dollar work for you so that it may multiply into more cash and generate for you another constant income
  • Protect your finances from loss

Invest your money where it will be safe, where you can recover the amount you put in if you desire to and where you will generate interest. Have conversations with knowledgeable individuals. Consult those with experience in handling finances so that their knowledge will safeguard you from putting the money in risky investments. Again, the wealthy’s habits when it comes to investing and debt management align with these classic personal finance principles.

7. They keep their investments simple by investing only in what they understand.

Non-investors often ask, what is the best thing to invest in right now with the most outstanding returns? This is a good starting point, but the answer you get from another person shouldn’t be what you use to decide.

The wealthy invest their time and energy to understand what market they will put their money. They take time and hire high-grade financial and investment advisors but as part of their research. They will not simply hire a financial advisor from a cold call or email. So I’m the end, they make their own independent investment decisions based on how they understand the sector. This is also why you would seek advice from them when investing. They have put in the time to understand the industry they invest in.

Almost 95 percent of the millionaires studied invest in the stock, with 20% or more in publicly traded stocks. The majority and Warren Buffet is popularly known for this, buying and holding the stocks. They don’t rush to sell with the ups and downs of the market.

8. They spend a lot of time planning their financial future.

Financially successful people plan their financial future in detail, from having an emergency fund to the ultimate goal of financial independence.

In fact, one of the millionaires interviewed in “The Millionaire Next Door” said they have wealth that can support their lifestyle comfortably for ten or more years without a single day of work.

For every 100 millionaires who said they didn’t take a lot of time to budget for their financial future, there are 192 whose answer was “yes.” The majority of those who didn’t plan were in the high income but low net worth category and those who inherited their riches.

Even with a vast experience of making investment decisions, they take a lot of time to plan, and it’s one of the primary reasons they remain wealthy.

9. Maintain sound financial records

Thomas J. Stanley and William D. Danko established that in a group of 220 millionaires 100 will not budget, and about 120 will.

How do those who don’t budget monitor their expenditure? A majority of this number uses the “pay yourself first” strategy. They save for their goals and spend the balance.

62.4 percent of the study’s millionaires know their family’s annual expenditure for food, clothing, and shelter.

10. They avoid consumer debt such as credit card debts but know how to utilize investment debt.

Wealthy people avoid credit cards to eliminate consumer debt. They have mastered delayed gratification, and with their frugal lifestyle, they can hold on until they have set aside money to use for particular items instead of purchasing on credit. But, they know how to leverage on debt when it comes to building businesses.

Most people or households today have high incomes, but very few are affluent. High income but low net worth households spend tomorrow’s cash today. They are debt-prone and live paycheck to paycheck. They live to display a high consumption lifestyle.


The wealthy’s habits are a clear indication that wealth creation follows simple principles, as mentioned in the timeless personal finance read “The richest Man in Babylon” by Clason. There are no mysteries, but most people disregard the simple habits to look for secrets that don’t exist. In truth, most people already know these simple rules but never get to try them. If you desire to become wealthy, learn from those who have done it, and it will save you time that you would instead spend experimenting.

Leave a Reply

Your email address will not be published.