There are a number of key characteristics and behavioral patterns that are often instrumental in enabling people to create significant personal fortunes. These ways of thinking, followed by corresponding actions, are referred to as Millionaire Intelligence.
Millionaire Intelligence is the framework people regularly employ to join the ranks of self-made millionaires. It is based on more than a quarter century of empirical investigations comparing the business-building and personal wealth-creating thought processes and behaviors of self-made millionaires with those of the rest of the population.
The results of this research show there are very pronounced and distinct ways of thinking about and approaching wealth creation that change in both intensity and nature as net worth increases. For example, there are decisive actions separating self-made millionaires from wannabes. Moreover, there are often highly nuanced behaviors, which distinguish those lower on the private wealth hierarchy from those at the very top.
Select Components of Millionaire Intelligence
For illustrative purposes, the Millionaire Intelligence framework can be divided into two sets of factors. One set is the way individuals think about the business world and how they approach doing business. It’s about how to work most effectively with associates, competitors and everyone else.
By and large, this is the mind-set of self-made millionaires. Without the right mind-set, a person is not going to effectively navigate to the outcomes that produce a noteworthy personal fortune. The other set of factors is the actions—the behaviors—that are key to driving financial success.
While Millionaire Intelligence has many interconnected synergistic components, the intent here is to highlight just a few of them. Self-made millionaires…
• Are committed to creating significant personal wealth.
• Put themselves in the line of money.
• Use failure to refine and focus.
• Connect for profit and results.
They commit to creating personal wealth: Truth be told, many people would like to be rich but haven’t devoted the time or effort necessary to get there. Doing so can often mean being faced with choices that help them reach their goal of being wealthy at the expense of something else that may be important to them. Self-made millionaires usually have a clear sense that amassing money is one of a number of very important objectives and that, by doing so, they consciously prioritize activities with the highest potential return, which may necessitate assigning a lower priority to many other things in their lives.
A commitment to creating personal wealth is regularly a core driver of success for self-made millionaires. To operationalize their commitment, they generally specify how much is enough. This is their financial end goal. A few aspects of financial end-goal setting include:
• The need to avoid “shiny objects” that appear promising but are only distractions from their financial end goals.
• Determining meaningful milestones along the way to their financial end goals.
• Comfort in resetting their financial end goals higher as they get closer to reaching them.
While it’s certainly possible to become personally wealthy without it being an express goal, it’s much less likely to happen. By wanting money and understanding why, people are much more likely to become self-made millionaires.
They put themselves in the line of money: Simply put, some endeavors are more fruitful and rewarding than others. For instance, building a successful business is habitually more lucrative than being a social worker employed by a municipality. Along the same lines, being the boss usually gives a greater chance for personal wealth than working for somebody else.
Since most skills are portable, it only makes sense that self-made millionaires apply theirs in the situations offering the highest paybacks. Following this perspective means they pursue fields and initiatives that have the highest potential for outsize returns now and in the future. Having equity in a business, for example, is regularly the very best way to be positioned in the line of money.
What is very characteristic of self-made millionaires is that they “run the numbers.” Using meticulous calculations or an instinctive familiarity with the financials, self-made millionaires look at each initiative and derive projected returns. The following are three guidelines they tend to use for running the numbers:
• It’s easy to do, but they avoid falling in love with an initiative.
• Self-made millionaires always work and rework the assumptions.
• They are able to justify their assessments under various scenarios.
Critically, self-made millionaires tend to look at each business decision as a way to ensure staying firmly in the line of money, which generally requires running the numbers.
They use failure to improve and refocus: Failure is inevitable, so most self-made millionaires don’t worry about avoiding it. Instead they focus on learning from each experience and using the lessons to get an advantage the next time around.
Rather than obsessing about lost opportunities and getting discouraged, self-made millionaires study their failures and do all they can to prevent repeating missteps. Central to “using” failure is perseverance. When confronted by professional setbacks, self-made millionaires are often energized. The following are some aspects of the way they make failure an ally. Self-made millionaires …
• Autopsy their failures, evaluating what went wrong and why.
• Are brutally honest with themselves when evaluating the mistakes they make.
• Work diligently not to repeat the same mistakes.
What really matters is how people handle failure, as it is likely a given. Self-made millionaires make failures work for them. By critically dissecting their failures, self-made millionaires learn somber lessons that they take to heart.
They connect for profit and results: Networking is generally recognized as an essential and often optimal means for personal and professional success. Even so, it’s painfully clear that most people are not capable and prosperous networkers.
Most individuals approach networking as a near-random exercise. For the most part, the majority of people seeking to gain advantages by networking are badly mistaking activity for productivity, incorrectly crediting the smallest of advances as being monumental.
Self-made millionaires regularly think about networking as a means to an end—finding the person, the information or the resources that get them one step closer to their personal and professional milestones, which, in turn, get them closer to their financial end goal.
While it’s important to have many valuable contacts, self-made millionaires usually maintain a small but deep network of relationships leading not to friendship but to personal wealth and influence. This form of nodal networking maximizes the time and effort spent toward realizing profit and identifying those things that can further enhance their wealth. A few core aspects of nodal networking include:
• Learning who the contacts of their contacts are so as to potentially benefit from the people they know well.
• Building “bench strength”—identifying people to replace members of their nodal network when appropriate—is regularly a requirement.
• Internalizing the concept and behavior called N.E.X.T.—Never extend extra time—so as not to waste resources on unproductive relationships.
Being strategic and focused when it comes to networking is vital. In this regard, there are four questions self-made millionaires tend to ask themselves when networking:
• What are they seeking to accomplish? Goals are essential, especially when it comes to networking. By adroitly setting goals for each relationship, and even each interaction, self-made millionaires are able to focus and improve their efforts.
• Who can help them achieve their goals? Knowing what they want to accomplish, self-made millionaires are better able to triage the many people they meet so as to determine which relationships can be most productive.
• Why do other people care? Generally, self-made millionaires work with the concept of “enlightened self-interest.” They’re determined to identify the core motivations, dominant preferences and critical concerns of the people who can help them so that information can be leveraged into mutually rewarding action.
• How are self-made millionaires going to get other people to care about them achieving their goals? Knowing why other people care and being able to connect these reasons to their agendas can create a powerful results-orientated network. Self-made millionaires tend to be very good at creating alignment between their goals and what will make other people care about them achieving their goals.
Being able to effectively answer these questions can be transformational. While the answers will many times change with circumstances, the majority of self-made millionaires derive tremendous value thinking strategically and purposefully.
In order to most effectively source self-made millionaires and work effectively with them, it is very useful to understand how their thought processes and actions have enabled them to create significant personal wealth. The answer is Millionaire Intelligence. At the same time, understanding how particular self-made millionaires actualize Millionaire Intelligence opens the door for financial advisors to do more business with them as well as motivate them to provide high-quality referrals.
For those financial advisors who are not self-made millionaires but would like to be, Millionaire Intelligence is the methodology to achieve this objective.