Offline inspiration: secrets of self-made millionaires

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Grant Cardone shares seven secrets of self-made millionaires:
Seven Secrets of Self-Made Multimillionaires | Entrepreneur.com

No. 1: Decide to Be a Multimillionaire -- You first have to decide you want to be a self-made millionaire.

No. 2: Get Rid of Poverty Thinking - There's no shortage of money on planet Earth, only a shortage of people who think correctly about it.

No. 3: Treat it Like a Duty - Self-made multimillionaires are motivated not just by money, but by a need for the marketplace to validate their contribution.

No. 4: Surround Yourself with Multimillionaires - I have been studying wealthy people since I was 10 years old.

No. 5: Work Like a Millionaire - Rich people treat time differently. They buy it, while poor people sell it.

No. 6: Shift Focus from Spending to Investing - The rich don't spend money; they invest. They know the U.S. tax laws favor investing.

No. 7: Create Multiple Flows of Income - The really rich never depend on one flow of income.

Seven Secrets of Self-Made Multimillionaires | Entrepreneur.com
#inspiration #millionaires #offline #secrets #selfmade
  • Profile picture of the author Claude Whitacre
    The book Business Brilliant gave lots of differences between millionaires and regular folk. A good subject to study. Thanks for posting.
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  • Profile picture of the author Neison
    Found a summary to Claude's book recommendation (just ordered -thx) and while I don't know Mark it looks to be a good set of one-liner notes.

    Book Summary – “Business Brilliant” by Lewis Schiff | Mark Deutsch's Blog

    Have you guys read Grant Cardone's books? Is there one you'd recommend first?
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    • Profile picture of the author Shadowflux
      While I haven't read the book, I've known enough self made millionaires to point out some of the major differences between them and "normal, ordinary, everyday" people.

      The self made millionaires treat money differently. They invest rather than save. They create positive cash flow instead of hunting down a bigger salary. Most importantly (and this seems to be an unpopular concept in today's world) they work with other people.

      The most successful people I know have all contributed to other people's success. They surround themselves with smart, passionate, hard working people, and they all make money together.

      You create loyalty in others not by motivating them, not by instilling fear, but by creating mutual passion and following that up with measurable success.

      Love is the key. Love what you do, love the people you work with, and do what you can to show it.
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  • Profile picture of the author misterme
    One of the books I'm currently reading is an eye opener about successful people, this author interviewed very successful people but didn't accept their initial responses about hard work, working smarter, insights yadda yadda and probed deeper. Sometimes he found the real factors to their success were things which were embarrassing, were really about things they had no control over, were in their favor but not of their making, were genetic... things of that nature. Some would confess to it when questioned deeper, others got furious. Point is, lots of people may think and do as many millionaires do, but they don't become millionaires. There's more to success than what successful people would admit, and sometimes, they don't really know but come up with stuff that sounds good.
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    • Profile picture of the author bizgrower
      Originally Posted by misterme View Post

      One of the books I'm currently reading is an eye opener about successful people, this author interviewed very successful people but didn't accept their initial responses about hard work, working smarter, insights yadda yadda and probed deeper. Sometimes he found the real factors to their success were things which were embarrassing, were really about things they had no control over, were in their favor but not of their making, were genetic... things of that nature. Some would confess to it when questioned deeper, others got furious. Point is, lots of people may think and do as many millionaires do, but they don't become millionaires. There's more to success than what successful people would admit, and sometimes, they don't really know but come up with stuff that sounds good.
      Sounds like how pro athlete's always say "We have to take it one day a ta time yada yada yada". Pat answer and then the rest of the story.

      Anyway, the book does sound interesting and we'd appreciate the title.

      Thank you.

      Dan
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  • Profile picture of the author socialentry
    What if I want to be as rich as the Rothschild?

    Seems to me that the really rich people cornered the market at the right time and essentially took enormous risk or they were born into it.
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    • Profile picture of the author iAmNameLess
      Originally Posted by socialentry View Post

      What if I want to be as rich as the Rothschild?
      Marry one..
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      • Profile picture of the author BrashImpact
        One of the biggest things that does not get discussed...

        They all have a System of some kind and Execute it Flawlessly.
        One of the people i work with has a net worth north of 570 million, It never
        ceases to amaze me how well he controls his time. He has systems in place
        for everything they do, nothing is left to chance. He takes risks, however those
        risks are minimized due to the systematic approach his companies use.

        My number one vote - Systems First - People Second - Investing - Hard Work
        in that order.

        Robert
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  • Profile picture of the author Glynn Kosky
    cool thread
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  • Profile picture of the author ronrule
    One that's more common (and less talked about) is views on debt.

    Most wannabe millionaires picture themselves in a beach house driving expensive cars... but the reality of the modern millionaire is very different; Driving a used car that was purchased with cash, and living in a traditional middle-class house in a nice neighborhood, not a mansion. Virtually no debt other than the house, and no investments until debt is eliminated.

    There's a huge difference between being a millionaire with liquidity and being a "millionaire" on paper. Those who understand wealth creation also understand that your income, not your investments, are your greatest tool for building wealth. For example, let's say I buy an income property, a $100K condo I could rent out for $1,200 per month.

    Now here's where the math comes in. Most people would mortgage that property with 20% down and have a mortgage around $500. You're making $700 per month so it feels like a win and you're happy with the result... except you're really winning at all.

    If the property had been purchased with cash, the sum of the rental payments would net me $14,400 per year cash in my pocket, repaying the full cost of my investment in under 7 years while the property appreciated. And the property is likely worth $175,000 now. I could sell it today and would have made a 275% total return on my investment - the $100K I collected in rents plus the $175K it's now worth.

    If I had mortgaged it, the numbers don't look so good... After 7 years of making that $500 payment every month, I've given the bank $42,000 - more than half the amount financed - but I still owe $70,219.70 because of the interest, meaning I gave away more than $32,000 to the bank and only put $700 in my pocket instead of $1,200. After 7 years that property, only $58,000 has found its way to my pocket. If I were to sell it today, I'd still owe the bank $70K.

    That makes my total return $163,000 instead of the $275,000 I would have made if I paid cash.
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    • Profile picture of the author misterme
      Originally Posted by ronrule View Post

      let's say I buy an income property, a $100K condo I could rent out for $1,200 per month.

      Now here's where the math comes in. Most people would mortgage that property with 20% down and have a mortgage around $500. You're making $700 per month so it feels like a win and you're happy with the result... except you're really winning at all.

      If the property had been purchased with cash, the sum of the rental payments would net me $14,400 per year cash in my pocket, repaying the full cost of my investment in under 7 years while the property appreciated. And the property is likely worth $175,000 now. I could sell it today and would have made a 275% total return on my investment - the $100K I collected in rents plus the $175K it's now worth.

      If I had mortgaged it, the numbers don't look so good... After 7 years of making that $500 payment every month, I've given the bank $42,000 - more than half the amount financed - but I still owe $70,219.70 because of the interest, meaning I gave away more than $32,000 to the bank and only put $700 in my pocket instead of $1,200. After 7 years that property, only $58,000 has found its way to my pocket. If I were to sell it today, I'd still owe the bank $70K.

      That makes my total return $163,000 instead of the $275,000 I would have made if I paid cash.
      But what about the power of leveraging the cash? If you put down 20% for the $100K condo instead of paying all of it, that leaves 80,000 to invest. So you buy four more $100K condos at 20% down.

      Now the return is a total rent roll over the seven year period of $504,000, the appreciation brings the properties to $875,000 for a grand total of $1,379,000.

      Subtracting paying the loan $210,000 ($500 mo. per property), that still leaves $1,169,000 - even with deducting loan interest from that amount it still seems to me the return is going to be far greater than $275K.

      Then there's also the power of getting to those profits faster than if you needed to wait seven years every time to recoup the cash to be able to reinvest again.

      Becoming a millionaire via income is great for those who pull down huge numbers but for most people, it's the investments over time paid from average salaries that gets them there.
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      • Profile picture of the author ronrule
        Originally Posted by misterme View Post

        But what about the power of leveraging the cash? If you put down 20% for the $100K condo instead of paying all of it, that leaves 80,000 to invest. So you buy four more $100K condos at 20% down.

        Now the return is a total rent roll over the seven year period of $504,000, the appreciation brings the properties to $875,000 for a grand total of $1,379,000.

        Subtracting paying the loan $210,000 ($500 mo. per property), that still leaves $1,169,000 - even with deducting loan interest from that amount it still seems to me the return is going to be far greater than $275K.
        Sure, in an ideal scenario that would be a great strategy, but there are a couple problems with it; First, unless your income already justifies it you wouldn't be able to take on five mortgages. Second, you'll be required to carry a certain amount of insurance based on the property value - this is a huge difference between being a cash buyer and financing. I'm not sure about where you live, but in the coastal areas here in Florida this is a pretty big deal and really screws the homeowners because you have disproportionate land values to home values. Take a $1 million beach house for example... if you mortgage that property, the bank is going to require you to carry insurance equivalent to the total property value, not just reconstruction costs. But it's the LAND value that's driving it up... you might be able to rebuild that house from the ground up for $200K, but you still have to be insured for $1 million because "that's the property value". If there's no bank in the middle demanding a policy for appraised value (or at a minimum loan value), you can buy an insurance policy for whatever amount you want. And that's just for homeowners insurance, some banks also require flood insurance on top of that, even if your house is designed in such a way that the living areas are above flood elevation or would be immune to short term standing water (stilt houses, etc.). On my last house we paid an extra $7,000 a year for flood insurance. I canceled that shit the day I paid the house off.

        I know some of that stuff is unique to the beach areas in Florida, but overall, financing introduces a lot of risk that isn't there in a cash scenario. Most of the people who were playing that game in 2007 lost everything in 2008, and when banks stopped lending the cash buyers scooped up the foreclosed properties and are making a killing now.

        The problem was that when the housing market crashed, rents fell too - in a wholly-owned scenario if you needed to decrease the rent to keep a tenant (or the property had to sit empty for a while) you're OK. If you're on the hook for a mortgage, there's a minimum you need to make to avoid going out of pocket. If the numbers don't add up or the market isn't moving fast enough to sell out of it and you have to let it go, that one ding on your credit will not only result in a loss of principle but also kill your ability to finance future properties in the future.

        I'm not saying it's never something you should do, there are ways to be smart about it. The main point was that there's a difference between "being a millionaire" and "having over $1 million in debt". There were a lot of "millionaires" in 2007 that would tell you they aren't anymore, but the truth is they never were - owing banks $850K on properties worth $1 million doesn't make you a millionaire. Personally I think it's a smarter decision to take a safe 14% annual return and keep any appreciation than make a risky 30% return and have the interest eat up the appreciation.

        When millionaires discuss OPM ("other people's money") they typically aren't talking about banks, they're talking about venture partners. There's a big difference there ... if you don't have the liquidity and want to spread out any real estate burdens, you're better off forming a corporation or fund with a couple other partners and pooling your cash to make the purchases than taking on debt. No sense in paying a middle-man to do something you can do on your own.
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        • Profile picture of the author sbishop
          Dave Ramsey would be proud!!

          [quote=ronrule;8962975]One that's more common (and less talked about) is views on debt.

          Virtually no debt other than the house, and no investments until debt is eliminated.

          There's a huge difference between being a millionaire with liquidity and being a "millionaire" on paper.



          Originally Posted by ronrule View Post

          Personally I think it's a smarter decision to take a safe 14% annual return and keep any appreciation than make a risky 30% return and have the interest eat up the appreciation.
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  • Profile picture of the author iAmNameLess
    I think one huge difference between the rich and the poor is that the rich always look for opportunity but the poor are hung up on obstacles. I wonder how many people browsing right now want to do this and that but are hung up on all the reasons they can't.
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    • Profile picture of the author BrashImpact
      Originally Posted by iAmNameLess View Post

      I think one huge difference between the rich and the poor is that the rich always look for opportunity but the poor are hung up on obstacles. I wonder how many people browsing right now want to do this and that but are hung up on all the reasons they can't.
      Could not agree more here. The mentality falls into the Broke category. So many excuses with no action.

      I personally have had some Awesome Failures and Big ones, have learned to embrace them and the education. The Successes just the same. It's simply a matter of perspective.

      Whatever a persons mental reality is, it becomes. (mostly broke)
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    • Profile picture of the author Matt Lee
      Originally Posted by iAmNameLess View Post

      I think one huge difference between the rich and the poor is that the rich always look for opportunity but the poor are hung up on obstacles. I wonder how many people browsing right now want to do this and that but are hung up on all the reasons they can't.
      Couldn't agree more. Most millionaires were't born into wealth... They broke out of the mindset of "I can't" into "how can I"

      It's a lot easier to to sit there and say "it's not possible" instead of putting your neck on the line and taking risks.
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  • Profile picture of the author shawnlebrun
    Joe,

    Have you read The Millionaire Fastlane by MJ Demarco?

    Amazon.com: The Millionaire Fastlane: Crack the...Amazon.com: The Millionaire Fastlane: Crack the...

    If not, I HIGHLY recommend it.

    Grant Cardone is great, and his book The 10X Rule is the one I read.

    It's very much into "work hard, bust your butt, outwork others, etc..."

    Copywriter Ross Bowring is the one who first got me into Grant Cardone, but I've never read a better book on how to get rich, online or off, than the Millionaire Fastlane.

    I read 50 plus books a year, and that's probably my favorite when it comes to no-holds barred, "do this, then do this to get rich"

    If you look at some of the reviews on Amazon, you'll see I'm not the only one who thinks its great.

    But yeah, if anyone here is into getting wealthy with anything internet related, The Millionaire Fastlane is literally a life-changer.
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  • Profile picture of the author misterme
    Originally Posted by ronrule View Post

    Sure, in an ideal scenario that would be a great strategy, but...
    Of course there's other costs and factors. I presumed your scenario was also under ideal circumstances as well and not about any specific areas, practices or requirements, just for the sake of presenting a case for it, as I did. Otherwise I'd harp on the pitfalls of taking seven years to recoup an investment,how anything can happen in that time period, how having all that cash tied up in one property ties up a tremendous amount of funds, time/value of those funds, yadda yadda.
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