19: Six Secrets of Millionaires
Part of my mission as a financial therapist and coach is helping people feel good about their money. A huge mission of my work is showing diversity in the way money can look.
Too often, people associate the word "millionaire" with an older, white male, or get a mixed-up idea that having money makes them a "bad" or "greedy" person.
This isn't anecdotal; psychological research backs up that many people hold these beliefs. This is the science behind things like "money mindset;" we may be holding onto limiting beliefs such as, "people like me don't have money," or "good people shouldn't care about money."
This stale image and unhelpful beliefs are why I started my #millionairemonday series. #MillionaireMondey is all about highlighting people of color, younger people, women, and non-binary folks. The hope is to represent better the new faces of wealth to inspire others. Research shows that representation matters, and it's my pleasure to share stories of millionaires, and soon-to-be millionaires, on select Mondays.
Here are the six secrets I've learned after interviewing millionaires and financially independent folks.
They look at real estate as an investment but don't include their primary residence as the only investment. They often buy rental properties, whether that's for traditional year-long tenant stays, or for short-term vacation stays. "Purple" isn’t a homeowner, instead using "geo arbitrage" as a part of her plan to keep costs down so she can retire in a few months at the age of 30.
They avoid lifestyle creep. When these millionaires got bonuses or raises, they continued to maintain their current lifestyle rather than increase their spending. By “pretending” to live off of their former incomes, they got used to more modest lifestyles and were able to save and invest more money. Jonathan and Candice Torian said that avoiding lifestyle creep was a key for them moving toward millionaire status.
They give back to causes that are important to them. Whether it's with time or money, they are generous by offering back to their communities. Roslyn Alba Cobrarrubias speaks at youth events regularly and produces Filipino Heritage Nights in LA.
They find value in their life outside of their net worth. For all the folks interviewed for the #millionairemonday series, they keep working once they've hit millionaire status. Not to "hustle" but because they know the value on their mental health to have a routine and purpose beyond sitting and staring at their bank accounts. Stephanie Xenos said once she became a millionaire, she started teaching barre for fun, as well as became a Big Sister in the Big Brother Big Sister program.
Their investment strategies are pretty vanilla. For Treslyn and Cory, they share that they, "don't believe in any get-rich-quick schemes or any "creative" investing. [They] invest long-term through low costs instruments and dollar-cost averaging.” Most of the millionaires I've interviewed said they are fans of low-cost index funds.
They say "Thank you, next" to people who aren't supportive. Whether it's family or coworkers, they don't let a little side-eye distract them from their goals of financial freedom. That might look like someone saying, "but you can afford it!" when they choose not to purchase something. It might sound like "you are spending another weekend looking at rental properties, doesn't that get old?" Instead, they join communities of people who are also interested in achieving Millionaire or FIRE status. By surrounding themselves with people who are like-minded and supportive, they get the community they need to achieve their goals.
Of the six secrets shared, check-in with yourself. How many are you doing?