Who Really Wants to be a Millionaire? - Rodgers & Associates

Who Really Wants to be a Millionaire?

The term “millionaire” once meant that a person lived a luxurious lifestyle and no longer needed to work. Market research firm Phoenix Marketing Inter­na­tional recently reported 8,386,508 out of 125,018,808 total U.S. house­holds (6.71%) can now claim millionaire status1. To be considered a millionaire by the standards of wealth research, a household must have investable assets of $1 million or more, excluding the value of real estate, employer-sponsored retirement plans, and business partner­ships, among other select assets.

Is it possible for an average American to become a millionaire? A study by Fidelity Invest­ments found that 88% of million­aires are self-made million­aires. Only 12% inherited their wealth2. Having a high paying job may help, but it does not guarantee you will become a millionaire. A Nielsen survey found that one in four families making $150,000 a year or more are living paycheck-to-paycheck3. One in three house­holds earning between $50,000 and $100,000 also depend on their next check to pay regular expenses. 

Dr. Thomas Stanley has studied the habits of wealthy people for the past 30 years. His ground­breaking research has uncovered the truth about the lifestyles of the wealthiest Americans. Many million­aires own their own businesses and consider themselves to be entre­pre­neurs. Their companies are rarely glamorous and are more likely to be blue collar jobs like paving contractors and pest control businesses.

Becoming a millionaire doesn’t happen on its own: It takes planning and perse­verance. Here are some steps you can take to grow your net worth.

Live below your means. This step is so obvious we should not need to be reminded. Unfor­tu­nately, most people never learn to spend less than they make. Unless you disci­pline yourself to save something from every paycheck, you will never accumulate money that can work for you. The secret to living below your means is to have a budget and use your budget every month.

Save a minimum of 10%. George Clason’s classic book The Richest Man in Babylon tells the story of a man who wanted to become wealthy. He started by saving 10% of his income and eventually became wealthy by having his money work for him. Research has shown many of today’s million­aires accumu­lated their wealth by saving and disci­plining themselves to increase their savings every year. Dr. Stanley’s research found most self-made million­aires save closer to 25% of their income every year. Saving 10% should be considered the minimum amount. 

Invest your savings in businesses. Your savings should be invested in growth-oriented invest­ments. Not everyone has the ability or desire to start and run their own business. However, we all have the oppor­tunity to be business owners by buying shares of publicly traded companies. Stock prices can be volatile, but you can minimize the volatility by owning stocks through diver­sified mutual funds. Investing regularly allows you to take advantage of stock market downturns through dollar-cost averaging. The Fidelity study found the million­aires surveyed ranked individual domestic stocks as their top investment in the past year, followed by certifi­cates of deposit, money market accounts or cash equiv­a­lents, equity exchange-traded funds, individual domestic bonds, and domestic equity mutual funds.

Don’t follow the herd. The Great Panic of 2008 turned out to be a great buying oppor­tunity. Stock prices fell by more than 50% during the downturn and recovered to new highs. Unfor­tu­nately, many investors sold their stocks during this period instead of buying, as evidenced by the net redemp­tions of stock mutual funds which total in the billions. This prompted legendary investor Warren Buffett to write in an op-ed article for the Wall Street Journal, “A simple rule dictates my buying: be fearful when others are greedy, and be greedy when others are fearful.”

Hire a financial adviser. It’s not easy to stay the course. You may need an independent third party to remind you of your goals and help you make the right financial moves—especially during times of great uncer­tainty. A good financial adviser will help you develop an investment strategy and keep you focused when you need it most. Investors often make their biggest mistakes by allowing emotions to interfere with good judgment. A financial adviser could help you keep your emotions in check.

If becoming a millionaire were easy, there would be more million­aires in the U.S. It takes disci­pline to live below your means, save, and invest. One of the million­aires inter­viewed by Dr. Stanley never made more than $60,000 per year. “I have accumu­lated most of my net worth by living below my means,” she told him. I have every­thing I want, but I have learned not to want too much.”


  • 88% of American million­aires are self-made.
  • Having a high income does not guarantee you will become a millionaire. You must learn to live below your means.
  • Million­aires invest their savings in growth-oriented investments.
  1. Million­aires in America 2020: All 50 States Ranked. By Dan Burrows, Kiplinger, May 28, 2020. 
  2. How Most Million­aires Got Rich. Business News Daily, February 18, 2020 
  3. A shocking number of Americans are living paycheck to paycheck. By Nicole Lyn Pesce, Market­Watch, January 11, 2020.