Updated: January 30, 2021
How do you become a millionaire? There are many ways.
I tried playing the lotto before but then I realized that the odds of winning are atomic. I also tried climbing up the corporate ladder but I felt that I’m not cut out for a 9-to-5 job.
Then, I tried entrepreneurship, which worked for me and so I started earning good money. However, while I began to live comfortably, my net worth wasn’t growing as fast as I wanted to.
It was not until I learned these four habits that I started to see real growth on my account. It took a few more years but eventually, my net worth reached seven digits.
What are these habits? That’s what I’m sharing with you today so that hopefully, it can also help you see that first million in your bank account.
1. Buying things that are durable.
I learned to give durability the most weight when choosing which brand or item to buy. I would read online reviews and ask for feedback from friends before deciding on major purchases.
This allowed me to save money, especially on shoes, bags, clothes, and gadgets, because I didn’t have to replace them as often. For instance, I prefer an iPhone because they last 2 years longer with me than my experience on Android phones with similar specs.
Moreover, I realized that durability doesn’t always come with a premium price. Most are just at mid-range, like Rusty Lopez, whose leather shoes I find to be really durable.
2. Creating checklists and systems.
Simply, I learned how to work hard AND work smart. Emphasis on “AND” because I realized that working smart means working hard first and then finding ways to do things faster.
Working hard is crucial because it provides a fundamental understanding of how things should be done. After which, I create checklists and develop a system so I could be more efficient, or so I could easily outsource or delegate the tasks.
For example, at first, I manually tracked my cashflow in a notebook and encoded them on a spreadsheet at the end of the day. Even though it was tedious, I remained patient and persistent.
Slowly, my simple spreadsheet transformed. From simple columns of income and expenses, I encoded formulas and other functions that gave me summaries, analysis, and predictions for my cashflow. I still use that spreadsheet today and it’s satisfying to see the history of my cashflow through the years.
Another example would be on paying my bills. I didn’t want to miss a due date, so at first, I’d pin the bill on our refrigerator door as a reminder. Additionally, I created alarms on my phone for the payment deadlines.
After months of experimenting, what worked best for me was to have a checklist in my smartphone of all my regular expenses with their usual due dates — electricity, water, internet, mobile plan, credit cards, etc. Then, once a bill arrives, which I now get through email, I’d just immediately pay them online and then mark it on the checklist. Rinse and repeat every month.
This way, I don’t have to remember due dates anymore. And based on their usual due dates, I can easily see which bills I have to follow-up or manually check because sometimes, the electronic statements of account don’t arrive on time to my email.
Creating checklists and developing personal systems improved my productivity. It also conserved my mental energy, so I was able to do more tasks that required analysis and deep thinking.
3. Investing regularly.
As part of my habit to develop systems that would increase my productivity, I realized that it will never be enough to simply work for the money. It’s cliche but it’s true — you have to find ways to make money work for you.
This was a period when I became obsessed with building passive sources of income. This led me to discover the merits of cost averaging as an investment strategy. And given that managing my businesses takes most of my days, this was my best option at that time.
I’m glad that I “forced” myself to invest monthly because when it eventually developed into a habit after a couple of years, the stock market went on a bull run. The value of the shares that I bought little by little every month from before suddenly tripled in value within months.
This made me a believer in cost averaging and that’s why it’s still my preferred investment strategy until today. It’s a boring strategy and that’s why I like it.
4. Having a growth mindset.
I learned how to love learning, especially through reading.
I consumed self-development, non-fiction books, and bookmarked a lot of blogs and websites that discussed my various interests. From reading, I learned about personal finance, business, productivity, investments, blogging, and so much more.
Aside from expanding my knowledge, I also worked on building new skills. In fact, if you check my LinkedIn profile, you’ll see that I have a good number of endorsements for Social Media Marketing, SEO, and even Online Reputation Management. They were given by peers whom I was able to learn from and work with before I became a Registered Financial Planner.
Your education determines your execution. You can’t do what you don’t know. That’s why you should always be learning, always be applying, and always be practicing.
These habits that helped me reach my first million are habits that anyone can learn; it doesn’t matter if you’re a student, an employee, a freelancer, a professional, or an entrepreneur.
Learn how to spend wisely so you can save money. Learn the best ways to get things done so you can earn more. Invest your earnings regularly, no matter how small, because it will eventually compound and grow. And never stop learning, because, in a world that’s always changing, what you know will help you recognize new opportunities that will come along your way.
I made my first million years ago… now it’s your turn.