Do you have a plan to become wealthy? Do you really know how you’re going to do it? Is it realistic? Is it likely to succeed? Will you be doing what you love while you are building your wealth?
Let’s be realistic here. Most people haven’t really thought through these questions in any formal, disciplined way. As a result, they have no clear plan, miss opportunities, and don’t live their lives to the fullest or leave a legacy for the future. Are you one of those?
But it can be done. With a reasonable amount of planning, a lot of disciplined hard work, calculated risk taking, and a bit of luck, becoming wealthy is a real possibility. According to Wealthx.com, the global ultra-wealthy population is expected to grow by 72,550 people reaching a total of 299,000 worldwide by 2021. You can make it to 72,551.
What’s your target? It seems to be generally accepted that $30 million in investable assets puts you in the ultra-high net worth (UHNW) category. This includes 2,300+ billionaires with $7.3 trillion in assets, but we’ll save that plan for another day.
At $30M+, you typically have excess to capital beyond your financial goals of income security, reserves for any health care needs, education and career launch of your kids and grandkids, a very comfortable lifestyle, and meaningful resources for charitable activities.
$30 million also comes with increased investment complexity, tax issues, some responsibility for next generation development and security, and other headaches that you would be happy to tackle.
Again, according to Wealthx.com, roughly 20% of UHNW individuals inherited their wealth. If you picked the right parents, congratulations, but you may want to read the rest of this article anyway. If you have already inherited or accumulated a significant nest egg, you should read further and be thinking about your offspring and guiding them with their career plans.
Another 15% of these individuals inherited assets (usually a small business) and grew them, but 65% are self-made. The paths taken by the 65%, lessons learned, and implications for your career plan are many and varied. Successes include the well-known Bill Gates, Mark Zuckerberg and other entrepreneurs, to lesser known inventors like Symmons’ pressure balancing shower valves, Nottingham and Sparks’ Swiffer, Robert Kearns’ intermittent windshield wipers, the owner of a company that makes bucket and mop handles, etc. It could possibly be one of your neighbors (particularly if you live in New York with over 8,000 UHNW individuals; Boston, over 2,000; California, 13,500; or parts of Asia). This is particularly true if your neighbor has diligently followed the income side of this extremely sophisticated formula:
Income – Expenses = Savings
This is the first of three posts on the subject. In the next newsletter, I will describe some of the underlying qualities, skills, and values you need to develop to achieve your goals. After that, I will outline some common paths taken to achieve UHNW status and lessons learned from those who have succeeded.