You can learn a lot of valuable insights from millionaires. It takes financial discipline, career advancements, and long-term planning to reach the milestone. One Redditor in the Millionaire subreddit decided to post some valuable insights about how they became a millionaire. These are the 10 big takeaways.
Zero Debt
The Redditor does not have any debt. While good debt can help with your long-term goals, credit card debt, and similar financial obligations aren’t good for your financial future. It’s good to create a plan to pay off any current debt and gauge when it makes sense to pay off good debt.
The House and Car Are Paid For
A house is typically your biggest expense, and a car is another major expense. Getting debt-free on these assets makes it easier to get more mileage out of your funds. You can buy a used car and a modest house to become debt-free sooner. Getting debt-free as soon as possible becomes important for some of the other insights the Redditor shares.
Living Far Below Your Means
The Redditor emphasizes living below your means as a way to build wealth. Having lower expenses makes it easier to save money. The Redditor even lived below their means when their income was much lower. The anonymous millionaire mentioned that you would never guess they were a millionaire if you saw them on the street.
Buy Things on Sale
This strategy aligns with living below your means. Looking at the discount aisle and shopping at thrift stores can give you products and services of a similar quality as new counterparts. You can also capitalize on your local library’s books and DVDs instead of getting a bunch of streaming subscriptions.
Buy High Quality Used Items at Vast Discounts
The Redditor recommends looking for high quality used items. The “used” label automatically knocks down the price even if the value is similar to something new. You’ll save the most money by getting a used car instead of a new car. However, you can apply this approach to other spending categories. The Redditor mentions that they bought a used Rolex for $6,000, and it’s now worth $15,000.
Live in a Small Condo
You don’t have to immediately move into your dream home. Condos are much more affordable than single-family homes, which means you won’t have to contend with high mortgage payments. You also won’t have to put as much down for the initial payment. The Redditor lived in a small condo for 10 years. You can do something similar and use all of the savings to buy a house. If you buy your condo, you can sell it while buying your house to make a bigger down payment.
Use Rent Hacking
The Redditor lived with multiple roommates who paid most of the living expenses. The anonymous millionaire continued this approach until getting married, and it resulted in significant savings. If you are solo, you may want to reach out to some friends in the area and see if they want to give house hacking a try. It’s not permanent, but it’s also a good approach to consider if you haven’t found your dream home yet.
Keep Your Old Cars
You don’t have to upgrade your cars as you make more money. The multimillionaire who posted on Reddit still drives in a 9-year-old Chevy SUV and a 20-year-old Lexus. Some cars are very durable and can last a long time.
Narrow Your Client Pool
The Redditor has worked with many clients, but now the Redditor is more selective.e The anonymous millionaire mentioned that they only work with clients that they enjoy and believe in. While it’s harder to narrow your client pool when you are getting started, you should set this as a long-term goal.
Invest At Least $5,000 Per Month
The anonymous millionaire wrapped up the post by mentioning that they invest at least $5,000 per month. This benchmark makes it easier to reach a 7-figure portfolio, but it also suggests room for improvement if you have more than $5,000 ready to invest in a given month.
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