This is an answer from Michael Crist on Quora. He replied to a question that I've asked.
Only the middle class believe the lie that “time is money”.
Often what separates normal people from millionaires is not luck, or necessarily talent, but the way we think.
What enables one person to build wealth and limits another person to a middle class lifestyle often boils down to worldview, perceptions, and the way we order things and parts of things in our mind.
To illustrate, think about this question:
What kinds of people should budget their money?
- The poor
- The rich
Chances are you guessed #1, that the poor are in more need of a budget than the rich.
Now, answer this question:
What kinds of people are more likely to budget their money?
- The poor
- The rich
If you guessed #2, you would be correct. The rich are far more likely to keep a budget. Often times they track their income and expense down to the penny.
Why is that?
Why would millionaire’s find it more important to budget than the poor?
What follows is my meager attempt to indirectly answer that question. I’m going to paint the picture of the millionaire mind (as I perceive it). If you look hard enough, you’ll find a person that sees and thinks about the world much differently than the rest of us.
I’m not a millionaire so take this with a grain of salt, but mindsets are of particular interest to me. I’ve read widely, and I’ve performed a nominal study on the habits and mindsets of the wealthy.
I hold the view that we are not what we eat, rather, we are what we think.
Here are some of the mindsets that set millionaires apart from the rest of us:
Time does not equal money
Most people trade their time for money. Millionaires realize that building assets that work for them is the best way to make money. Often, millionaires own more than one business. They almost build them as a hobby.Opportunity is everywhere
Millionaires see opportunity every where. Every pain and problem is an opportunity to build a product or a service. When someone complains, it’s a potential money maker.Action is the best teacher
Many get stuck in “student mode.” They read books, articles, and pay for online courses, but they never actually do anything. Millionaires are the opposite. They’ll learn the basics and then dive in. Most of their lessons are learned through experience.Mentors are a life hack
Speaking of learning… millionaires often find mentors. They see the value in learning from others that have experience. This is a different quality of teaching than what is provided through a book or a webinar. This kind of learning is personalized, tailored specifically to them by an industry expert.Profit > Revenue
Millionaires could often care less about revenue. They care far more about profit. Think about it: 10% profit on $100,000 is only $10,000. 50% profit on $20,000 is also $10,000. Which business would you rather own?
(Yes, revenue does matter. A business with a 50% profit margin that only makes $10,000 a month is not a money maker)
Money is a tool, not a goal
Millionaires do not daydream about diving into a pool of money. It can buy fancy airplanes and cars, but for the most part, it is a tool. It is a tool to build things, repair things, and get things done.Determination
Millionaires work tirelessly towards a goal until it is completed. They understand the “art of the finish.”
Acquiring these mindsets is not entirely straightforward. There is no manual for how to do it. The best hack I’ve found is immersion.
By immersion into the millionaire mindset, I mean:
- Reading books written by millionaires
- Reading biographies written about millionaires
- Watching interviews with millionaires
- Reading psychological studies about millionaires
- Finding a wealthy mentor
- Doing what millionaires did (or are doing)
It won’t be easy and you’re likely to fail along the way. Even if you do everything right it is no guarantee that you’ll be a millionaire. But with the right steps you can stack the cards of life in favor of you springing out of the middle class and into a new income bracket.
Cheers!