The hosts of the popular podcast and financial education brand, “The Money Guy Show,” Brian Preston and Bo Hanson, recently conducted a survey of 1,000 millionaire clients. They sought to uncover essential insights into their financial journeys, particularly how they accumulated their wealth.
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The responses may surprise you.
The participants in this survey, while their median net worth was $2.2 million, did not all have million-dollar salaries. Most had incomes ranging between $1 million to $5 million, but the median income was only $250,000 annually, with 12% earning under $100,000 each year.
These individuals did not achieve wealth by landing six-figure salaries; instead, they focused on sound saving and investing habits.
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The findings also challenge the notion that an elite private school education is necessary for wealth attainment. In reality, 77% of those surveyed attended public schools for their K-12 education, while 69% enrolled in public colleges. A significant detail is that almost 90% of these millionaires graduated without any significant student debt.
They accomplished this by managing their student loans effectively or avoiding them altogether.
A crucial insight from the survey is the high level of dedication these millionaires exhibited regarding savings and the percentage they saved. An impressive 58% of them began saving before reaching the age of 30, with another third commencing their savings in their 30s, yet still achieving millionaire status. The critical factor was the savings rate; 43% of survey participants saved and invested at least 25% of their gross income.
People often have a tendency to purchase luxury items as their income increases, but the surveyed millionaires largely shunned extravagant luxury cars and complicated financing options. Approximately 60% paid cash for their most recent vehicle, while 72% financed their first car yet adhered to sensible debt repayment strategies. Remarkably, 84% of them kept that vehicle for seven or more years.
These millionaires preferred buying reasonably priced homes rather than lavish estates, with the median home value being around $650,000. These residences typically represented about 25% of their total net worth.
