I spent 5 years interviewing 225 millionaires. Here are the 4 types of rich people and their top habits

In 2004, I set out to conduct a five-year study called The Habits of the Rich to examine how the world’s richest people think about their money. Each of the 225 millionaires I interviewed fell into one of four categories:

1. Savers-investors: No matter what their day job is, they make saving and investing part of their daily routine. They are constantly thinking of smart ways to increase their wealth.
2. Mountaineers Company: Climbers work for a large company and devote all their time and energy to climbing the corporate ladder until they reach a top management position—with an extremely high salary.
3. Virtuous: They are among the best at what they do and are paid highly for their knowledge and expertise. Formal education, such as a university degree (eg law or medicine), is usually a requirement.
4. Dreamers: All of the people in this group are pursuing a dream, such as starting their own business, becoming a successful actor, musician, or best-selling author. Dreamers love what they do for a living, and their passion shows in their bank accounts.

The Saver-Investor path requires the least risk—at least compared to pursuing an entrepreneurial dream or artistic passion. But 88% of the millionaires I interviewed said that saving, in particular, was critical to their long-term financial success.

The average millionaire in my study took between 12 and 32 years to accumulate net worth of $3 million to $7 million.

Below are their three most common habits that anyone can adopt:

Every saver-investor in my study consistently saves 20% or more of their net pay, every paycheck.

Many have achieved this by automating the withdrawal of a fixed percentage of their net pay. Typically, 10% goes into employer-sponsored retirement accounts, and the remaining 10% is automatically directed into a separate savings account.

Then, once a month, investor-savers transfer their accumulated 10% monthly savings into an investment account, such as a brokerage account.

Even if 20% is too high right now, consistently saving a smaller percentage can help you reach your financial goals for the future.

As saver-investors consistently invest their savings, their money compounds over time. When they started, this compound interest was not very significant. But after 10 years, they began to accumulate considerable wealth. By the final years of their working lives, Saver-Investors’ wealth had grown to an average of $3.3 million.

Millionaires who chased a dream and started a business (also known as dreamers-entrepreneurs) did not have the ability to invest their savings, especially in the early stages of pursuing their dreams. Whatever savings they had were used as working capital to finance their dream.

Interestingly, however, once most of these entrepreneurial dreamers achieved success in the form of available cash flow, they immediately turned around and started investing their profits.

One of the common denominators for the thrifty investors, corporate climbers, and self-made millionaire virtuosos in my study was frugality.

For these millionaires, frugality starts the moment they get their first paycheck. For entrepreneurial dreamers, it started the moment their dream created enough cash flow to allow them to save and invest.

Being thrifty requires three things:

1. Awareness: Be aware of how you spend your money.
2. Focus on quality: Spend your money on quality products and services.
3. Bargain shopping: Spend as little as possible by shopping for the lowest price.

Frugality alone will not make you rich. This is just one piece of the Wealthy Habits puzzle, and there are many pieces. But it will allow you to save a larger amount of money. And the more you save, the more money you can invest.

Tom Corley is an accountant, financial planner and author of “Rich Kids: How to Raise Your Kids to Be Happy and Successful in Life” and “Wealthy Habits: The Everyday Success Habits of Rich People.”

Do not miss: