We’ve all heard the slogan, “good savings and wise investment”. But IYHO, how effective is being a “wise-investor” in the world of high-rise finance? Does it actually work?
Are most of the millionaires I read about just far more wise when it comes to making business/economic decisions than the next guy, or are they just plain lucky?
I mean, when it comes to making your big bucks, how much does wisdom count, in your experience?
[–This may seem like a stupid question. You might say, “Xavier, wisdom is the key to eternity. Of course it’s the only factor when making your millions you fool”. But I am interested in your opinion about what other factors come into play. For example, is it more important to “talk the talk” than “walk the walk”? How much influence does a “gift for the gab” have exactly, and how much does this zone in to why the current crop of millionaires are… well, millionaires?–]
Well, in my youth I ran two different six figure startups into the ground by taking too much money out too soon. I’m wiser now, and wouldn’t let that happen.
Most millionaires made their money the old fashioned way, inheritance. Others had a vision fueled by a passion (Bill Gates, Sam Walton). The rest of them (very few) were just lucky.
Wisdom is generally an hindrance to making a lot of money. Mostly it’s greed and energy that makes for success. Especially greed … the self-made millionaires I have known would happily starve others to death if it meant they got a slightly larger income by doing so. I don’t know how it goes with inherited wealth.
I think wisdom is used more in keeping yourself a millionaire than in making yourself one. Luck, inheritance, or a good idea at the right time will usually make you a millionaire.
Most people who are millionaires don’t look like the folks on Dynasty. They are people who have good equity in a middle class home and a decent chunk of savings. That’s really all it takes, and it is attainable by most people with a college education, a solid work ethic, and a bit of good luck from time to time. But it takes a while. That’s why all those people moving into their dream houses in Florida and Arizona are old farts.
Wise investing is important. If you want to be a millionaire and don’t have a super-high-paying job, picking a good index fund over putting everything into a single high-risk stock will make all the difference in the world.
Friedo: Yes most people with a net worth over $1,000,000 are fairly ordinary folks who saved agressively, invested carefully and avoided any big-ticket screwups or setbacks. And almost everyone in that category has a net worth between $1M and $2M.
BUT, it seems to me the OP wasn’t talking about those folks. He was talking about Hilton, Gates, Getty, etc. The big cheeses with the SERIOUS net worth.
And for them a totally different dynamic applies.
I agree with the other folks that it’s mostly tremendous drive and some greed and some luck. Early connections don’t hurt either. Wisdom plays a very tiny role IMHO.
Lots of folks with the same greed and drive don’t have the luck and so they never make the big time. They may top out at 50 employees, or go bankrupt.
By the OP’s definition (or at least by my interpretation of it), we’re dealing with a statistically tiny slice of the population. So generalities tend to break down and individual factors tend to predominate.
The old geezer I used to work for is worth about $50 million. He started with nothing and worked his way to the top, but you wouldn’t know it to look at him. After eight years of working for him, I came to realize how he made a lot of his money. He cheated his employees, he made shady deals, he took advantage of others, he engaged in deceptive practices with suppliers.
In an attempt to offset this evil, he donated money to his church. They are, I am sure, eagerly awaiting his death since they are the main benefactor of his estate.
The man is an evil, hateful bastard. Not to mention a racist.
Years ago being a millionaire was rare, but that was back in the days when a Coke was a nickel and a pack of cigarets was 30 cents. There are tons of “dime store millionaires” these days, people with less than 3 million. I really don’t think about those people when the term “millionaire” is used. Dime store millionaires can’t buy a big yacht, have 2 luxury european cars, 3 huge houses, and take several expensive vacations every year.
If I had to hang my hat on any one particular trait that will tend to be common among millionaires, it is not wisdom, knowledge, timing, insight, organization, personality, it is a certain brashness - chutzpah, if you will.
Those who have amassed fortunes have done so because they dared to do so. Where most would sit back, analyze, question themselves, let others question them, and ultimately let the moment of opportunity pass, these people will step in and take what they believe they have a right to have.
Some might call it courage, some might call it confidence - even “greed” might suffice. But the fact is, they did something. Most simply sit.