Money And Lifestyle Secrets That Only The Wealthy Know

In a surprising survey from Pew Research Center, only 17% of Americans think that wealth is “very important,” and 43% believe that it’s “somewhat important.” Despite this, most people have daydreamed about being rich at one point. But have you ever wondered what it’s actually like?

For instance, most millionaires don’t upgrade their phones every year, and many live well below their means. The wealthy think differently about money than most people do. Want to know how? Read these lifestyle and finance secrets that the rich are keeping.

They Think Differently About Money

Even before they became wealthy, self-made millionaires thought differently about money than most people. According to Steve Siebold, most people think that money is out of their control. But rich people believe that wealth is within their grasp.

A man holds up keys to a red Ferrari.

“Getting rich begins with the way you think and what you believe about making money,” says Siebold, who got rich from giving financial advice to companies. If you genuinely believe that you can make it, then you’ll work harder.

Many Prefer Credit Cards

At first glance, the rich seem to have little use for credit cards. But according to Fox News, many millionaires continue to use credit cards for the benefits. Lots of credit card companies provide “cash back” rewards of hundreds to even thousands of dollars. Financial planner Mark Vandevelde got $875 back on his.

Credit cards spill out of a woman's purse.
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Plus, credit cards help people track where their money is going. It’s easier to track purchases and taxes with credit cards, especially for couples or families. And as long as you pay it off, you won’t have any interest.

They Don’t Upgrade Their Phones Every Year

Every year, people purpose the latest smartphone model, often to appear rich. But wealthy people don’t need to look the part. Believe it or not, some businessmen still own old Blackberries!

A man looks at his iPhone.
LLUIS GENE/AFP via Getty Images
LLUIS GENE/AFP via Getty Images

Wealthy people invest in high-quality, long-lasting products. Research from the University of Chicago determined that most high-income people own iPhones. But that doesn’t mean they’ll upgrade it every year; many people keep their iPhones for at least 20 months, according to research from Kantar Worldpanel.

Luxury Does Not Motivate Them

Although many people want money to buy luxurious cars and houses, this does not motivate the average millionaire. In the mid-’90s, researchers interviewed over 1,000 self-made millionaires. Most were motivated by freedom, security, and independence.

A man drives a luxury car.
Drew Angerer/Getty Images
Drew Angerer/Getty Images

Instead of wanting an expensive watch, wealthy people want to experience new things, feel safe in their finances, and run their own businesses. The same study found that most millionaires are frugal; few spent more than $399 on a suit. What drives you to earn money?

They Live Far Below Their Means

Many people see giant mansions and believe that they must cost a fortune. They do, but not for millionaires. Wealthy people always live below their means so they can save more and spend more. If that means starting with a one-bedroom apartment, so be it!

A luxury lounge features modern, black-and-white furniture and decor.
Julian James/Construction Photography/Avalon/Getty Images
Julian James/Construction Photography/Avalon/Getty Images

Believe it or not, some rich people even rent. Gail Corder Fischer, the executive vice-chairman of Fischer & Company, advises against buying a house. It costs a lot more to upkeep than a rental.

The Rich Have Multiple Incomes

Beyoncé doesn’t just make music. She also owns an athletic clothing line, Ivy Park, and a vegan meal service, 22 Days Nutrition. Like many millionaires, Beyoncé has multiple sources of income. Even a small side gig can earn you more money.

A man wearing a luxury watch adjusts the cuffs on his shirt.
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Some apps will pay you to watch short ads, play games, and take surveys. Swagbucks, Inbox Dollars, and Quick Rewards will hand you money for these simple tasks. That’s far easier than running a clothing line.

…But They Don’t Hold Too Many Baskets

Yes, wealthy people run multiple businesses. But they don’t have too many sources of income. If you invest in too many companies, you’ll end up with less money and more stress. Remember: most millionaires started with one source of income and accumulated more over time.

A woman sits at an office desk and talks on the phone.

A five-year study found that most self-made millionaires have three income sources. Many of these companies are related in some way. For example, they might own a fitness and nutrition company, not a fitness and a car company.

They Follow The 50-30-20 Rule

One of the biggest questions is how to divide your money. Self-made millionaire Grant Cardone follows the 50-30-20 rule. In this method, 50% of your income goes to necessities, such as rent, groceries, and utilities.

A woman carries shopping bags up an escalator.

Thirty percent is personal spending, including extra investments. The final 20% goes into savings, which builds up pretty quickly. Of course, you don’t have to follow these percentages exactly. But the 50-30-20 rule provides an outline for you to manage your income.

They Buy Straight From The Manufacturer

Many common items are not being sold–they’re being resold. Jewelry, cosmetics, and even organic produce hop from a manufacturer to a seller, who sells it for twice as much as it’s worth. This is especially important for businesses.

Expensive products such as perfumes, shoes, and earrings sit on a fur blanket.

The founder and CEO of HomeTask, Jerrod Sessler, saves hundreds of dollars every month by purchasing food straight from the manufacturer. Even if you’re buying an engagement ring, contacting the jeweler directly could save you hundreds that you would otherwise spend in a store.

They Buy Bulk Items

Would you believe it if we told you that billionaires buy bulk at Costco? Mark Cuban does. Bulked items are often discounted and give you more bang for your buck, especially for long-lasting purchases such as canned soup and cleaning supplies.

A high tea three-tier tray holds food at the Peninsula Hotel.
Tim Graham/Getty Images
Tim Graham/Getty Images

“You’re better off buying two years’ worth of toothpaste when it’s on a 50% discount,” Cuban said. “There’s an immediate return on your money.” Remember: even a few bucks saved can go a long way.

They Learn A Specialty Skill–And Sell It

Whether people make millions on music, tech, or art, they all have a specialty skill. Wealthy people find what they’re good at and market it.

A woman works in front of a coffee shop window.
Pat Greenhouse/The Boston Globe via Getty Images
Pat Greenhouse/The Boston Globe via Getty Images

Remember: having a specific skill means nothing if you don’t advertise it. Become “known” for that skill, and you’ll find more opportunities. After all, people won’t want to hire or buy products from someone if they don’t have a valuable skill.

Some Of Their Income Is Not Business-Related

Although many wealthy people become famous for starting their own business, you don’t have to take that risk to earn money.

Dollar bills rain down on Miley Cyrus during a concert.
Scott Barbour/Getty Images
Scott Barbour/Getty Images

Sell your old furniture, spend less on take-out, go to fewer concerts, stash coupons, or move into a smaller apartment. For wealthy people, money saved is money earned. Find any way to make money or spend less of it.

Early On, They Build A Reputation

Obviously, many millionaires and billionaires are famous. But they didn’t start that way. They network and build a reputation within their career. Why else do you think singers collaborate on songs? To reach a wider audience!

A wealthy man looks out at the ocean while standing in front of his bathtub.

Today, social media helps people network. Talk to other people in your field. In your social media profile, be clear about what you do so that others can find you. A reputation might seem minor now, but it could aid you in the future.

They Don’t Pay Too Much On Home Insurance

From the perspective of a rich person, most people are spending too much on home insurance. Although everyone is required to have it, you have options with several companies and discounts.

A mansion sits on top of a cliffside.
Joe Sohm/Visions of America/Universal Images Group via Getty Images
Joe Sohm/Visions of America/Universal Images Group via Getty Images

If you’ve done construction, installed smoke detectors, or upgraded your roof or windows, you might be eligible for a discount. The wealthy also know to spend more on the deductible. When you pay more upfront, you’ll pay less on your premiums, according to the Insurance Information Institute.

They Start Saving Early In Life

Some millionaires were once poor. Even when they were living month-to-month, many were consolidating their expenses. To do so, they “pay themselves first.” When they receive their paycheck, they immediately put some amount into savings.

A well-dressed man takes money out of an ATM.
SIA KAMBOU/AFP via Getty Images
SIA KAMBOU/AFP via Getty Images

With this method, people can spend $4 on a coffee without guilt. Even putting away 10% of your paycheck can add up over time. After saving up money, the wealthy invest it in businesses or startups that they believe in.

Before They Became Rich, They Planned How To Spend Money

Most self-made wealthy people planned on becoming rich before they even received the money. The founder of Agency Growth Secrets, Josh Harris, always asks people what they will spend their future profit on. If you don’t know, then you’ll end up spending it on random, spur-of-the-moment purchases.

A woman writes notes during a meeting.
Andia/Universal Images Group via Getty Images
Andia/Universal Images Group via Getty Images

“Someone once told me, ‘If you don’t know how you’re going to spend your money, then you’re never going to make that money,'” Harris told Make It. So far, that has held true.

They Only Invest In Businesses That They Understand

It might seem smart to invest in tech companies, but if you know nothing about coding or engineering, that’s not a good idea. Wealthy people always invest in fields that they understand or feel passionate about.

Two people in suits shake hands.
SAUL LOEB/AFP via Getty Images
SAUL LOEB/AFP via Getty Images

Even “for fun” passions can come in handy. For instance, Steve Jobs studied calligraphy at Reed College simply because he enjoyed it. Later, the calligraphy training helped him choose fonts for Apple and Macs. Never underestimate your interests or where they could lead you!

They Put Millions Into Life Insurance

Have you ever noticed how extravagant some celebrity funerals are? That’s because many celebrities put at least $1 million into life insurance. It pays off, not only for funeral expenses but also to pay your family should anything unfortunate happen.

A man in a suit flips through stacks of $50 bills.
STR/AFP via Getty Images
STR/AFP via Getty Images

If you can’t afford to dump $1 million into life insurance (like most people), don’t fret. That amount builds over time. Some life insurance companies begin at just $8 a month. Find a plan that works for you.

They Pay Off Credit Cards Through Their Companies

It’s no secret: many wealthy people own companies, and they use those companies to help pay off their credit cards. Although you might not own a business, you can still get help from companies. Businesses like AmOne will match a low-interest loan and leave you with one bill (and no monthly payment).

A Visa credit card is cut up.
Karol Serewis/SOPA Images/LightRocket via Getty Images
Karol Serewis/SOPA Images/LightRocket via Getty Images

The catch is that many of these businesses have a limit. You need to owe the credit card less than $50,000 a year, and you’ll still have to pay it back.

They Avoid Decision Fatigue

Have you ever wondered why billionaires like Mark Zuckerberg always wear same-colored clothing every day? It’s to avoid “decision fatigue.” When we make too many decisions in a day, we become mentally exhausted and end up giving in to cravings or impulse spending.

The CEO of the shirt company Olymp stands next to a rack full of shirts.
Marijan Murat/picture alliance via Getty Images
Marijan Murat/picture alliance via Getty Images

Wealthy people go to great lengths to avoid decision fatigue. One method is to automate your savings so that you don’t have to think about it. Also, creating routines can remove decision-making from your mornings and nights.

They Learn The Financial Language

Millionaires are “financially literate.” They understand the differences between a company and personal finances, and how those vary by state. Of course, when they own multiple businesses, they often hire financial advisors to learn the details for them.

A sign of Wall Street appears in front of American flags.
Spencer Platt/Getty Images
Spencer Platt/Getty Images

Understanding the “financial language” helps millionaires work around excess payments and taxes. For instance, companies don’t pay taxes right away; they can reinvest the money and have no profit tax. If you want to lead your own business (like most wealthy people), learn the financial language.

They Save To Invest

Wealthy people don’t save money simply to have it. They often save with a goal to spend it on other companies and entrepreneurs. During an interview with Inc. Best Workplaces, Cardone said that he goes “broke” twice a year by investing in other projects.

A man stands on a staircase in a $20 million house.
Matt Cardy/Getty Images
Matt Cardy/Getty Images

Investing doesn’t have to be complicated, either. Start with your company’s 401(k) and then move onto a Roth IRA or traditional IRA. Depending on your income and tax revenue, you may have several options.

They Have Short-Term And Long-Term Investments

Wealthy people have two types of investments: short-term and long-term. The short-term investments make money soon, such as jobs that have biweekly paychecks. Long-term investments accumulate wealth over ten years or more.

Multiple people sit around a business meeting.
View Pictures/Universal Images Group via Getty Images
View Pictures/Universal Images Group via Getty Images

New businesses, heritage brands, land, and art make great long-term investments. How do you choose the right investment? By picking something that you believe in. Believe it or not, the richest families in Florence today were also the richest families in 1427–because of long-term investments.

They’re Willing To Feel Uncomfortable

Wealthy people are willing to put themselves in situations that most others would shy away from. These include negotiating your salary, moving to a new city, or leaving your comfortable job for the unknown. In short, they are not afraid to take risks.

A hotel magnate walks out of her private jet.
Per-Anders Pettersson/Getty Images
Per-Anders Pettersson/Getty Images

Thomas Corley, who studied self-made millionaires for several years, found that most of them are working on learning a skill or enter a new circle of friends. “Each time you engage in a new activity that causes discomfort, you expand your circle,” he says.

They Own A Piece Of A Company With Only A Few Bucks

You might have noticed that many celebrities–including Roger Ebert and Ashton Kutcher–made millions by being shareholders in larger companies. A shareholder invests funds into a company and gets a certain percentage back. The secret? They don’t have to invest a lot.

A person's hand holds up a dollar bill.

You can invest as little as $5 into big companies like Apple and Amazon and make money back. Ebert and Kutcher made millions off of Google and Twitter, respectively. Check out apps like Stash that allow you to invest.

They Work To Become Well-Rounded

Although self-millionaires have a specialty skill, they are also constantly learning to become more well-rounded. That’s why many have recommendations for books and podcasts.

At a coffee shop, a man reads a book called

Aim to read or listen to podcasts every day for at least 30 minutes. Hughes recommends looking into finances, politics, and sports. Part of networking is impressing your colleagues, and becoming well-rounded will help with that.

Most Of Them Give Money To Charity

The stereotype of a narcissistic, greedy businessman does not fit all wealthy people. Most avidly give money to charity or create their own. Michael Bloomberg donates millions to education and art across 129 countries, Gordon Moore has sent billions to research, and Jeff Bezos gives billions of dollars to homeless families each year.

Warren Buffett stands next to Bill and Melinda Gates onstage during a charity event.
Spencer Platt/Getty Images
Spencer Platt/Getty Images

Not only do charities aid people in need, but they also expand a person’s reputation. They introduce wealthy people to new circles and help them appreciate what they have.