Warren Buffett is a saver-investor.
Jack Welch, a virtuoso.
And Mark Zuckerberg, a dreamer.
There’s something fascinating about uncovering patterns.
I recently found a great study focussed on the habits of the rich.
Unsurprisingly, it’s called Rich Habits.
Researched and written over 5 years by best-selling author, speaker and chartered financial planner, Tom Corley.
It’s interesting to see the commonalities across high earners.
And realise that being wealthy has less to do with luck.
In the study, 233 wealthy individuals were interviewed, each answering 144 questions.
Tom has shared his findings with 50 million people in 25 countries.
And written numerous books.
Covering everything from the habits, thinking and psychology of the wealthy to their decision making.
One of the things he learned was how they actually created their wealth.
And he found 3 predominant paths the wealthy pursued.
1. The ‘saver-investors’
Or, as I like to call them – the ‘Warren Buffetts’.
They made up 22% of those Tom studied and all had zero debt.
The passive income generated by their savings helped to meet or exceed their standard of living.
Essentially, they spent less than they earned.
They all had 5 things in common:
- A low standard of living
- A typically modest income
- An income that exceeded their low standard of living
- A long-term savings plan of 20% or more of their modest income
- Consistent and prudent savings behaviour over many years
Together, this wealth level averaged $3.4 million.
Which took about 32 years to accumulate.
2. The ‘virtuosos’
Approximately 27% of the rich people in the study were virtuosos.
They were among the best at what they did in their career, industry or profession.
Which is why I liken them to Jack Welch (Ex-CEO of General Electric, multi-millionaire and leadership guru).
They tended to work for large corporations over long periods and develop their careers.
Often beginning at the bottom and, many years later, arriving at the top.
Together, they had an average wealth of $4 million.
Which took around 20 years to create.
3. The ‘dreamers’
They made up around 51% of the total group interviewed.
They pursued a big dream and were able to turn it into a reality.
Which eventually provided them with an enormous income, profit or gain.
They accumulated an average of $7.4 million.
In roughly twelve years.
Mark Zuckerberg is an obvious example of this category.
Yet unlike the tech visionaries of Zuckerberg, Jobs and Gates…
The odds of starting out on this route early in life are appalling (Almost 9 out of 10 fail).
Those starting out in their mid-40s right up until their late 50s have by far the highest chance of successes with the average founder beginning at 45.
The driving force to the phenomenon appears to be experience.
Both because of general on-the-job maturity and skillsets that are developed.
Along with industry-specific domain knowledge.
In other words, not only is the average entrepreneur much older than the stereotype…
But the most successful entrepreneurs tend to start even later.
So, what’s the take-away?
There’s more than one way to build a fortune but, true to all, is the notion of time.
It takes many years to build and preserve wealth.
In addition, it takes patience and commitment.
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