If you want to become a millionaire, it doesn’t hurt to start thinking like one. Keith Cameron Smith in his work on “The Top 10 Distinctions between Millionaires and the Middle Class,” shares the insights he gleaned from spending two years working with and studying the ultra rich people, including the attitudes that differentiate their ways of thinking from that of the average person. If you want to put yourself up for success, here are millionaire mindsets to take on.
Looks are not Always What They Seem
Remember that being wealthy doesn’t mean looking wealthy. One of the most surprising findings of Thomas Stanley and William Danko, authors of the bestselling book “Millionaire Next Door” is that our mental image of a millionaire is completely wrong. In point of fact, millionaires are much more likely to be frugal, follow a budget, and live within their means than they are to fill a swimming pool with $100 bills. Most American millionaires drive practically used cars, live in modest homes, and avoid wasting money on status symbols. What many non-millionaires get wrong is the feeling that you must ostentatiously spend money in order to prove your worth, whether it’s your net worth or your emotional worth.
Millionaires think long-term
Millionaires not only think about present also they consider the potential of the future. That means setting goals that might span years or decades, not just weeks or months. According to Smith, the longer you can stretch your thinking into the future, the richer you will become. That’s because long-term goals force you to grapple with big-picture questions such as, “How can I double my income this year?” instead of short-term issues, such as, “How am I going to pay my bills this month?”
Smith finds that millionaires are willing to put temporary comfort on hold to seek out long-term financial freedom. And that mindset speaks to an important trait many millionaires share: patience. Based on Smith finding, middle-class people want instant gratification, whereas rich and very rich people have developed the discipline of delayed gratification.
Millionaires embrace change
Whether small or big, change can be intimidating. While the middle class tends to fear change, millionaires view any type of change as an opportunity. According to Smith, the problem with the middle class is it assumes change will be negative most of the time, whereas millionaires assume that all change, positive or negative, will benefit them. Learning to welcome change, and welcome the growth that often accompanies it, builds confidence, which according to it is essential key. In the case of millionaires, confidence is acquired through preparation and hard work, and it is the result of working on yourself.
Millionaires never stop learning
Based on the Smith observation, in any millionaire’s home usually, you’re likely to find an abundance of books, if not an entire library. That’s because millionaires know that learning doesn’t stop even the school is finished. According to Smith, success is a process and if a percentage of your income isn’t going toward a financial education, you will stay trapped in the middle class. The more money you spend on financial knowledge, the more money you will make. The good news is the cheapest and easiest way to start investing in your financial education is through books. Through books, you can learn a concept in only a few hours from a book that took someone years to develop. Thus it feels $20 books may have worth $20,000 because of what you have learned from them.
Millionaires ask themselves empowering questions
The No. 1 difference Smith observes between millionaires and the middle class is how millionaires present information to themselves. While millionaires ask themselves empowering questions, the middle class tends to lean toward disempowering ones.
Millionaires ponder, “How can I make $1 million a year doing what I love?” while middle-class people stick to the practical: “How can I get my boss to give me a raise?” Millionaires look at a hard situation and ask, “What is life trying to teach me right now?” while the middle class tends to focus on, “Why do bad things always happen to me?”
The distinction between these sets of questions is subtle but crucial. The reason is empowering questions to ask what you can do, and disempowering questions ask what you can’t-do. Smith added that empowering questions can cause you to reach your full potential. In general, based on Smith observation, millionaires are more creative than reactive, when it comes to a problem, and in fact, how you frame situations informs how you handle them. Instead of simply taking things as they come, millionaires focus on how they can make the future different, and better.
Most Importantly ….
Millionaires are much more likely to have what psychologists call an internal locus of control. Basically, the theory of locus of control looks at how people perceive their ability to run their own lives, and individuals have either an internal or an external locus of control.
Those with an internal locus of control see themselves as in charge of their lives. They would look at all the ways they could have done things differently and vow to learn something from their experience if a person with an internal locus were to invest money in a business that failed.
Someone with an external locus of control, on the other hand, feels as though they have no power over what happens to them. They would feel that luck was against them and that there was no way to prevent it if they were to lose the same investment. This means that an external locus investor would just stop trying after the first failure, while an internal locus investor would get back in the game with new insights.
It can be extremely difficult to change your locus of control from external to internal. It’s easy to just blame luck or fate because it means that you don’t have to keep trying when things don’t go your way. But if you want to become a millionaire, you have to recognize that the only one who has the power to make that happen is you.