wealth mindset

What is the best way to develop a wealth mindset and become wealthy? Well, a good start is to find out what wealthy people think and do and start applying this to your own life.

Besides having a great wealth mindset, wealthy people also adopt specific behaviors that other people don’t do. Start modeling these behaviors and you can have what they have too!

In this article, you will learn the 8 specific factors that predict how wealthy you will be. Discover the mix of wealth mindset traits and specific behaviors that wealthy people do. Then start doing these too!

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So let’s kick off with some questions:

  • What behaviors do most millionaires have in common?
  • What are their main personality traits?
  • What does it take to become a millionaire?
  • What does it mean to have a wealth mindset?
  • Can an ordinary person build extraordinary wealth?

To answer these questions, I’m going to share the research results from two great authors. The first is Chris Hogan, who studied 10,000 millionaires. The second is Sarah Stanley Fallaw who studied 600 millionaires in the US.  Here are the links to their books on Amazon.

These researchers uncovered 8 behaviors or wealth mindsets that almost every millionaire has. These 8 factors can predict how wealthy someone will become in spite of their age, background, or current income.

So here are the 8 factors that you can use to predict how wealthy you are going to be.

1. Frugality

The first one is frugality – a commitment to saving and spending less than you earn. It’s sticking to a budget and resisting lifestyle creep. What is lifestyle creep? It’s spending more when you start earning more. Frugal people typically spend about 80% of their income. The rest, they invest.

Frugal people know that becoming rich or financially independent is not about how much you earn. It’s about spending less than you earn. That’s the crucial thing. They’re creating a financial buffer for their future. The money they save might be used to start a new business or retire early.

True financial freedom or financial independence means having time as well as money. To have time, you need income from passive sources. It can be rental income, income from investments, or from an online business. That income doesn’t need to be very high. It just needs to be high enough to exceed your expenses.

2. Confidence

Confidence is essential if you want to be frugal. You’re going to get pressured from other people to spend money. It takes courage to say no. You have to be determined to stick to your budget.

Being confident also means being able to invest with your head and not your emotions. Whether it’s investing in a property or stocks and shares, it’s easy to get emotional and not think realistically. Rich people are very good at taking a detached perspective. They have the skill of weighing up the pros and cons logically.

They also act on opportunities quickly. Rich people seem to have the ability to recognize an excellent opportunity when they see one. They don’t procrastinate on decisions. They take action immediately because they have that wealth mindset. They’re confident in their skills and abilities. This gives them resilience, persistence, and self-belief.

3. Taking Responsibility

If you’ve read some self-help books, you probably know that taking responsibility for your life is extremely important. So, it’s not surprising that one of the crucial traits of wealthy and successful people is taking personal responsibility. They don’t count on other people to help them get rich. They take action by themselves. They don’t blame others either. They won’t even blame the economy when they fall short.

Sometimes millionaires lose their wealth when the economy changes. But what’s interesting about these people is that they are capable of coming back and making money again. They are taking responsibility and not blaming the economy. Even if the economy affects them in the short term, they know they’re going to get back on track.

A part of taking responsibility is being flexible. You must be willing to try different things. It’s also about focusing on what you can control. In any situation, it is essential to know what you can manage and influence, especially when other people are involved. It’s also about aligning your daily habits with your own goals. Rich people have consistent daily habits that are taking them towards their goals.

Interestingly, most millionaires are self-made. They have not achieved their wealth by luck, through inheritance, or by having wealthy parents. There are so many stories about self-made millionaires that were just like anybody else. Still, they had that something that led them to success. And that was not given to them by birth. They had the wealth mindset that you can develop and cultivate too.

4. Goal Setting & Achievement

Successful and wealthy people are goal-orientated. They set short-term and long-term goals for their financial future. Researched showed that 92% of wealthy people had a long-term plan for their finances. And 97% of these people accomplished almost every goal they set. So they rarely fall short. They set goals, and they achieve them. They’ve mastered the art of setting goals and, most importantly, accomplishing them.

5. Focus & Tenacity

This one is about seeing tasks through to their logical conclusion. Not being distracted by other things or other opportunities. Resisting the shiny object syndrome. Successful people generally stick with one business idea or venture for a significant amount of time. They might see other, perhaps even better opportunities. But they decide to stick with the one they started. Especially if they can see some signs of success.

There might be times when switching to another business venture, or opportunity is the right thing to do. But generally, this will be the last resort for a person with a wealth mindset. They are aware that taking action on their current venture is much more critical. It means staying in the game for the long term.

They’re also a lot less focused on immediate gratification. Their willingness to give up spending time and money on things now is helping them to achieve better results in the future. They are capable of avoiding the “I need to have things now to be happy” mindset and focus on long-term gratification. They are long-term thinkers. They are thinking 2, 5, even 10 years in advance.

If I’d started saving when I was 20, I could well be on the way to being a millionaire now. But I didn’t have that long-term vision in my early 20s. If you are in your early 20s, understand how important this is. What you do financially in your early 20s can make an enormous impact on your financial future. Start planning for your future right now!

6. Social Indifference

People with a wealth mindset don’t feel a need to keep up with the Joneses. When your neighbor buys a particular car or something else, do you feel the need to do the same? Genuinely successful people don’t feel a need to do that. They don’t feel the pressure from others to buy the latest iPhone or some other gadget. Sometimes they have older technology because they use their money for other things.

When I first started working, I moved into my first shared house in London. I was talking to my flat mates who were making a good income compared to me. I asked if they were saving some of that extra money for the future. They said no, they just spent more instead! So they earned more, but spent more too! As I mentioned earlier, this is known as “lifestyle creep”. I didn’t want that to happen to me, but it has, although I’m addressing this now!

7. Working Hard

The next thing that productive, successful and wealthy people do is work hard. They’re always willing to do whatever it takes even when it’s not easy. They’re eager to challenge themselves. They’re ready to stretch themselves. And 93% of people who became millionaires achieved that with hard work. It was not about knowing the right people or being in the right place. It was sheer hard work that got them to where they were.

These people are continually working on improving themselves. They won’t settle for what they have or who they are today. They’re always looking for more. Even though they are very successful now, they’re always looking for ways to improve themselves. They develop themselves further so that they can be even better tomorrow. Investing in their education and skills makes them capable of embracing the latest technologies or business trends. They have that wealth mindset that there’s always more to learn. And they have the curiosity that drives them.

One more thing that is significant is to take on jobs that you are passionate about and that you love doing. When you work on something that you’re excited about, it’s a lot easier to do the hard work. You’re much more motivated, and it’s much easier to keep going when the going gets tough. If you love what you are doing, you’re more likely to do it very well. You are always going to perform better at something that you enjoy, and you’re happy doing.

8. Being Consistent

To be consistent means doing the same thing day after day, week after week, month after month, year after year, even decade after decade. If you want to be consistent, you need to be patient. You have to be able to let go of immediate gratification and focus on the long-term goals. Having a good focus is essential. You need to have the ability to stay focused on your plan and your goals for financial wealth and freedom. If you have a passion for what you’re doing, that should make everything easier.

So, these are the 8 behaviors and wealth mindset traits that the vast majority of millionaires have, based on extensive research.

To learn more, I highly recommend reading the following two books.

If you enjoyed reading this article and found it useful, please leave a comment or question below.  I would love to hear what you think!   Please also click on the stars below to rate this post. Also, feel free to share this article with other people or on social media.

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Thank you for reading this article.  I hope you are having a wonderful day!

Paul

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