Smart Money Habits That Made Ordinary People Millionaires (With Tom Corley)

Transcript:

On this episode of the Personal Finance Podcast, smart Money Habits that made ordinary people millionaires with Tom Corley.

What's up everybody, and welcome to the Personal Finance Podcast. I'm your host Andrew, founder of Master money.co. And today on the Personal Finance podcast, we're gonna dive into smart money habits that make ordinary people. Millionaires. If you've got any questions, make sure you join the Master Money Newsletter by going to master money.co/newsletter.

And don't forget to follow us on Spotify, apple Podcast, YouTube, or whatever podcast player you love listening to this podcast on. And if you wanna help out the show, consider leaving a five star rating and review on Apple Podcast, Spotify, or your favorite podcast player. Now today we're gonna be talking to Tom Corley, who holds a master's degree in Taxation and is a bestselling and award-winning author.

Now, Tom is the author of Rich Habits, which is a book that I have talked about a number of different times on this podcast. But in addition, he also has written a number of other books like Rich Habits, poor Habits. Rich kids, smart money habits at every stage of life, and has written a ton of different books that are fascinating.

Now, in this episode, today, Tom has studied millionaires and people who have wealth for years and years and years. So in this episode, we're gonna be talking about some of the common habits that come up with millionaires. We're gonna be talking about simple daily money habits that you can implement in your life.

Today we're gonna talk about how millionaires save and invest, and how they earn their income. We're gonna talk about the different mindset that most millionaires have that you may not have, and we're gonna talk about how millionaires teach their family. About money as well. And as always, we're gonna go through a rapid fire around with Tom to get his answers on a bunch of different questions that we love to ask all of our guests.

So this is an action packed episode. If you are interested in the habits of millionaires, you're gonna love this. Once without further ado, let's welcome Tom to the Personal Finance Podcast. So Tom, welcome to the Personal Finance Podcast. Andrew, thank you so much for having me on. I really am honored and I appreciate it.

So I was kind of telling you before the show too, but I am so excited to have you here because I have listened to you doing, you know, different podcast interviews and read your books. Um, and I remember originally listening to your podcast, one of your podcast interviews, and it was just absolutely amazing some of the information that you kind of found by interviewing different millionaires and wealthy people.

And it really inspired me to kind of either. You know, just change some of the habits that I had day in and day out. And I remember at that time I was working in corporate America and, you know, there were some specific habits which we can talk through in this episode. But there were some specific things that once we started to dive into some of that stuff, um, I was like, man, you know, millionaires and rich people, they do things differently than most people.

And there are small habits that anybody in this world can do. And one of the. Beliefs of this podcast is we believe anybody in this world can build wealth. You just kind of have to have the understanding. A, you have to have money, psychology, but B, you have to have the understanding of some of these simple habits that you can do day in and day out consistently.

And your book kind of unlocked that for me, and I think this is why. Um, I'm so excited to talk to you today because I think there's just gonna be so many cool things that we can dig into. So for listeners who don't know you yet, or for listeners who have not read your books yet, or anything else that you have done, what kind of inspired you to study the habits of the rich in such depth?

Well, I, so it took my publicist to drag this out of me because I really didn't understand the, the true motivation. I always said the motivation was because I had a business client that was failing and they asked, they were crying and they said, you know, what am I doing wrong? What are your rich clients doing right?

And so I started by, you know, looking at the millionaire next door that didn't gimme the answers. And then I embarked on a study that I had no idea Andrew was gonna take five years. I just kept going, you know, like the Energizer bunny I kept, I hated wealthy people, if you can believe that, because my story was, we were rich and then we were poor.

And most of my poverty was when I was a child. Uh, but I do remember being rich. I remember the country clubs, I remember the big parties. I remember all that stuff and I liked it. Uh, so I, that was the real underlying cause, uh, or fire that was simmering inside of me when I embarked on this study is, you know, I really wanted to know what happened in my family.

Why did we go from being rich to being poor? I think that's really what it boils down to. And I found out, I learned there isn't anything I don't know about. Wealth creation and poverty creation. I've read every book there is out there. And, um, my study has helped really fill in the blanks and make it clear to me that everything is completely 100% within our control.

The problem is we've got this albatross around our necks that, uh, I guess you could say. Comes from childhood and it's the things that we learned growing up our parents teach us and experiences we have as children and it sticks with us, uh, throughout our lives. Absolutely, and I think that money story is something a lot of people, once they realize what that actually is, they can absolutely change the outcome for their lives once they understand that.

It kind of reminds me of the statistics that come out that, hey, 79% of millionaires were actually self-made and that's why we kind of truly believe anybody in this world can do this. You just have to understand some of these habits. So what are some of the daily money habits that nearly all self-made millionaires share that you have found?

Yeah, so before I answer that, I have to break up the self-made millionaires into. Four groups, because that's what I learned. There's four ways that self made millionaires built their wealth. One was the saver investor path. The other was the path. You and I were both on the big company climber path path.

I was also on the virtuoso path. I, I have Path, I have a Master's in Taxation. I have a CPA, I have all these other licenses. And then the entrepreneur path, which is interestingly also a path that I'm on. Each one of these paths has certain specific rich habits, and I incorporated that into a book called, uh, rich Habits Wealth Academy, that's only gonna be published right now in China, uh, eventually in the us.

But I found like the investors, that's a simple one. They were just saving 20% or more of their net income and then they were consistently investing it. And uh, then there's the entrepreneurs. They literally. Not only invest all of their savings, all of their 401k money, if they came from corporate America, uh, they'll leverage their house, they'll go into debt.

Uh, they'll do anything in pursuit of their dream. And the virtuosos, they, their main thing was also investing in their education. A lot of virtuosos have master's degrees. They have PhDs. Things like that. And the things that they did, you know, to create sort of side gigs were writing, speaking, teaching even, you know, I taught, I was, uh, with my master's degree in tax, I was teaching for like seven years.

While I was running a CPA firm and a financial planning practice. So they, you know, I guess they, the important thing is they have what I'll call an to like an umbrella category called growth habits. They have, not to save your investors, but the other three categories, they have these growth habits that force them to grow and improve and become the person they need to be.

In order for success to visit them, see the saver investors, they can just save 20% or more and they can invest it prudently. And you know, over 32 years, I found in my study they'll accumulate about 3.3 to 3.4 million. But the other three categories, the virtuosos, big company climbers and the entrepreneurs.

Uh, you know, they have growth habits that force them to become, sort of, gain an expertise in something. Uh, and because they gain this expertise and, you know, in corporate America, they'll, you know, it's about building relationships and being really smart and knowing something, you know, just having a little bit more knowledge than everybody else.

And then you get promoted. You just get, keep getting pushed. They give you new projects to work on and you have to say yes to every single one of them if you don't say yes. Then you get pulled off the list, uh, and you won't reach the C-suite. Uh, and the entrepreneurs are constantly learning. They're constantly reading.

They're constantly watching YouTube videos. They're watching, uh, TEDx, uh, interviews. Uh, they're doing everything they can because the reason is they're obsessed with the pursuit of their dream. And virtuosos are the same thing because they know the more knowledge I have. The more expert I become in what I do and the more I get a premium as a virtuoso.

I'll do a speaking gig and if I go to Vietnam or China or wherever, they'll pay me 10, 15, $20,000 for each, you know, 30 minutes, 40 minutes. And that's only because I have that virtuoso type knowledge that nobody else has. So, you know, that's how they do it. They just, you know, they grow and improve and become something that they need to become in order to be successful.

Is there a particular habit overall that you have seen kind of people be surprised that millionaires practice this every single day? Is there one that kind of just surprises people the first time you talk about it? Yeah. I'll tell you, the reading to learn was, didn't surprise me that I knew, uh, 'cause I was doing it myself, but before this study, uh, but the daily exercise habit I had in my head, Andrew, this visual, a picture of wealthy people as being fat.

Overweight, smoking cigars, drinking too much. You know, I had, this is the picture I had in my head, and what I found out in my research is that the 80% of the self-made millionaires were exercising. Every day, 30 minutes or more. Typically it was aerobics, but there was a good percentage of them that also lifted weights and went to the gym and did that kind of stuff.

And I learned, I said, wow, why is this So now it forces me to take a deep dive into why is it important to be healthy? And I found out that it improves brain performance. It increases the gaba that's, uh, protein that. Brain uses to build neurons and build the, my own sheath around the axon branches. Uh, it also increases the amount of oxygen and oxygen.

The more oxygen you have in a brain cell, the more a TP, which is the primary form of, uh, fuel that gets converted from glucose. And there's a cousin that gets converted from ketones if you, um, burning fat. That it releases ketones. And the ketones release 20% more energy than, uh, glucose does through a TP.

So I learned that these, uh, self-made millionaires, whether they knew it or not, were actually exercising because it helped. Improve brain performance. It optimized their brain so that they could concentrate and focus more longer and get into something that I like to call the flow. It's, uh, just focus, concentration, uh, the ability to do that for long periods of time where it was inherent in, uh, the entrepreneurs, that was amazing to me.

They could go 3, 4, 5 years working ridiculous hours and being in the flow. That was surprising to me. I remember, you know, originally hearing that too, when you would chat through that and it's just such a powerful lesson on one of those things where, you know, I'm really big into fitness and working out.

I just, if I miss a day, I know that like that day, I'm just not gonna think as clearly if I miss a day. Mm-hmm. You know, in the morning or whatever else. Specifically when it comes to, you know, lifting weights or aerobic activity, those two things, you could just feel a massive difference in your brain functionality in terms of just how clear you're thinking about some of the decisions that you're making.

And so it's so impactful overall. And then I remember, you know, one of the big stats that you had in there was that, uh, the millionaires, you know, read at least 30 minutes of nonfiction books every single day. Yeah. And that's important because if you say to someone, you know, leaders are readers, well, not exactly, they read to learn.

And, uh, you have to be reading in order to grow and improve your knowledge base. Uh, and it don't have to be just reading Andrew, it, I built an Irish pub in my backyard by watching YouTube videos. I'm not kidding. Uh, it was, I had a picture, you call it vision boards. I had a picture on my wall. Of a home one day that I would own down at the Jersey shore, a couple of blocks from the beach with an Irish pub in my backyard.

I think I had that on my wall for 15 years and I would look at it all the time. And do you know, I live three blocks from the beach today with an Irish pub in my backyard. So these visuals, they work, they become dreams and those dreams. Once you focus on them every day in terms of this is what I want, uh, your brain goes to work, the subconscious part of your brain goes to work, and particularly, um.

The reticular activating system, which is attached to the thalamus that alerts you to environmental factors that are in alignment with your dream. So it's like, imagine you're in an airport and all you hear is a thousand voices. It's all a buzz, right? And then somebody says, Andrew, and you immediately turn around.

That's the reticular activating system. Well, instead of it being Andrew, maybe it's some information you needed from the environment that helps you achieve a goal. Or there's an opportunity that presents itself that you didn't see before because you didn't have a dream or a goal that you were pursuing.

That's how, now I own this place because I put it in my head and I put it on the wall and I looked at it and my brain went to work and it said, uh, write a book. Write another book. Do speaking gigs, do this, do that In enough time, I accumulated enough money where I could afford to buy that house down by the beach.

And that's just an incredible story of just you doing day in and day out kind of some of these habits that really have a huge impact on the bottom line. A lot of people will kind of think through this and they'll say, okay, I remember just reading the Reading Habit, for example, and I was started to, okay, I'm gonna read one book every single week, and it was amazing how fast my knowledge accelerated and my proficiency and just all these different things just by kind of investing those dollars in myself, investing in just a simple, cheap, you know, inexpensive book once every single week.

I'd read that book every week, and I could do so many more cool things just by ingraining that habit. If you start to exercise and if you haven't exercised before, you know more frequently, all of a sudden you're gonna see, hey, you are so much more clear on what you're doing. Like you said, if you have something where you have goals set in place, then all of a sudden your brain starts to get to work on that.

You. Take those small steps towards those goals, it's gonna make a huge impact in your life, which is why it's so important to study these millionaire habits and kind of see what they do, because it can absolutely transform your life if you actually do them. And that is why I think this is so incredibly powerful overall to kind of see what a lot of these millionaires do and what they all have in common.

So is there approach to spending decisions that is different for millionaires? Are there, you know, do they spend their money differently or how do they think about spending their money overall? Yeah, so saver investors are very frugal. There's a difference between frugal and cheap. Frugal is you search for the highest quality product or service first, and then you start looking at pricing.

And so, you know, that's a just a common rich habit that saver investors have entrepreneurs. Conversely, they literally are spending money hand over fist. In pursuit of their dream. So there is no correlation between save investors and entrepreneurs, and that's an interesting factoid I want to point out because the entrepreneurs are consistently investing whatever money they get their hands on into themselves and their business and their dreams.

Whereas save investors are saving 20% or more. They're being frugal. Virtuosos are investing their money, spending their money on education. Primarily, uh, advanced degrees and things like that. And the big company climbers, they invest their money in building relationships. They'll send out, uh, gifts. They'll send out cards.

If there's a wedding, they get, somebody gets money and it may not have to be even a family member, could be somebody they know at work. Uh, usually somebody above them whose kid got married, you know, Hey, let me send this kid, uh, $350. And, uh, they never went to the wedding. And so they spend money. The big company climbers spend money on forging powerful relationships, and one of the things I learned from the millionaires in my study, particularly the entrepreneurs and the big company climbers, are that relationships are the currency of those two wealth groups.

They build relationships as a habit intentionally because they know it's going to further their agenda, their pursuit of whatever dream it is that you know they're pursuing. And I love that portion. 'cause I think here's, and I'll ask you a question on that here in a second. And I think the relationship building portion is just so important for those entrepreneurs and those folks that really, really need to have those relationships.

Mm-hmm. Did you, in your studies, find anything, you know, how did they systematically, 'cause you kind of said they made it a habit to do this. Mm-hmm. Is there a way that they systematically tried to forge those relationships? Are there habits that you saw, uh, did they go to networking events? Did they make sure they never ate lunch alone?

Was there specific things that they did mm-hmm. In order to kind of, you know, build out their network? Yeah, there's a couple of things. So one is the happy birthday call, whoever they come into contact with. It's usually people that matter, people that. They believe they want it. They need to invest it. So they'll make a phone call, Hey, I just wanted to wish you a happy birthday.

Uh, then there's the hello calls. That's just to say, call up, say hello. You know what's going on? That's really a reconnaissance mission. They wanna gather information on their contact. They want to build a stronger relationship by knowing more about them. So the Hello Call does that, and then the life event call is the most powerful call.

That's when somebody dies, somebody gets married, somebody has a kid, you make a phone call. It's always an emotional phone call. For the recipient and they never forget that call. It grows the roots to that relationship tree deep, very quickly. Uh, and then the other thing, the fourth thing I'll say is they, I found that a lot of the self-made millionaires were members, or either on the board or on committees of nonprofits.

They were typically. Uh, local community-based nonprofits, but with the big company climbers, they were big organizations that their, uh, senior executives were, uh. You know, on the board on, or something like that. I had one story where one of the, um, and this is a true story. One of the individuals in my study was the number two guy at a pharmaceutical company in New Jersey, and he was, uh, I did some financial planning for him in addition to interviewing him, for which he did not know I was interviewing him for the Rich Habits study.

But anyway, you know what he did. He started out at the pharmaceutical company at the bottom level. Let's just call it the mail room. It wasn't, but let's just call it the mail room. And he, after a couple years, he said, I want to be one of these senior executives. So he joined a trade group for that pharmaceutical industry.

And he participated in that trade group for like five or six, seven years before anybody in his company noticed. And the way that that. Senior executive noticed was, uh, somebody at the table mentioned, Hey, you got somebody that works for your company. He's a really smart guy, hard worker, blah, blah, blah.

And he, this senior executive went back to the secretary at his office. And do we have somebody by the name of Tom Corley working at this pharmaceutical company of ours? And they say, oh yeah, he works at this uh, division. You know, it's a small little thing. He doesn't. He goes, not anymore. He's on the management track and he slotted him into the management trainee program.

This guy ended up with, you know, within 15 years he was a top executive. So they do things like that with, that are obvious to, you know, after the fact. They're obvious to everybody. That was a smart thing to do, but they're not obvious. In real time, you know, I should be doing this, I should be on a nonprofit.

I should be joining a trade group in my industry if I wanna rise up the ladder. That kind of stuff. And I think that part is so interesting. It's almost taking that extra step in order to make sure you're kind of joining some of these groups and being, you know, you meet so many people when you join a nonprofit.

You meet so many people. You know when you join some of these networking groups that are out there, these business groups or clubs or whatever else, and it's just. The more people you meet, it's just one extra step that you can take to being able to open up some door that could really, you know, help you build wealth over time.

I've just noticed the more relationships that I've made, just in every single industry. It really is, your network is your net worth in a lot of situations because they can open up doors to other opportunities that you've always wanted to kind of reach. And so I think it's just so cool to kind of see that a lot of millionaires obviously are investing in themselves.

They're exercising, they're investing in their knowledge. They're investing in time into networking with other people. What other investing habits have you come across that have been smart investing habits for them? Specifically when it comes to maybe their money? Do they invest more? I know you said the entrepreneurs invest a lot of their dollars into their business.

Mm-hmm. Are there any other smart habits that you came across that really did help them kind of propel themselves to that wealthy habits? Yeah. That wealthy habit at a wealthy level? Yeah. I would say one of the variables or data points that I discovered in my research was multiple streams of income. Uh, I was like, these millionaires, these self-made millions.

They had a number of income streams. And so I did a deep dive into that. And what I found was that 84% of the self-made millionaires had at least three streams of income. They had three streams, 39% had four streams, and 27% had five or more streams of income. Wow. And then I remember after Wow. Discovering this data point.

I was reading a book on, what's his name? The guy from Virgin Atlantic. Oh. Uh, Richard Branson. Richard Branson. He wrote a book and he was talking, he had something like 500, you know, multiple streams of income. And the funny thing was, so I'm, I'm reading his book, I'm like, oh my God, this is in alignment with everything, all my research.

And the funny thing was, Andrew, I was asked to speak with Robin Sharma, had a thing called the Titan Summit. And he, uh, every year. And so he asked me to speak at the Titan Summit. 'cause he heard me on the Success Magazine. He used to have a CD that they included in the magazine. And I did this big interview with Success Magazine and he, Robin listened to it and he was blown away.

And he said, I wanna have this guy speak. So at the last minute, he, he pulls me in and I'm speaking and he says, oh, by the way, you gotta follow Richard Branson. And I was like, what? Are you high? I mean, I said that to Robin. I didn't even know him. I said, are you high? I'm not following Richard Branson. I never get nervous speaking and I never get, you know, in front of a people.

I love it. I'm, I just, it's just an inherent trait I have. I like being in front of people and teaching them. But I, my knees started shaking until I heard Richard Branson speak. Then I was like, oh, this guy sucks. You know? He's a terrible speaker. So, but that was funny because I, you know, it was like all of this stuff was kind of connecting.

It was weird, you know, here I am, I'm reading Richard Branson's book two years ago, and now I'm following him on stage. But the, I guess the, you know. Circle back. It was because of the multiple streams of income that introduced me really to Richard Branson. I mean, everybody knew him. He was a icon, but I didn't really know much about him, but I do now.

And uh, he had so many streams of income. And if you look at all of these, I'll say it's a big. Chunk of luck with these instant millionaires like Zuckerberg's. There's a big chunk of luck that goes into it that is not created luck, uh, what I call opportunity luck. It's just random luck. They just happen to be at the right place, the right time, and just things happen and, but they all start taking their millions and investing it.

Other businesses that are synergistic to what they're doing, but it's still, they generate a stream of income and now they have more income and now they can do more things and then all of a sudden they become philanthropic, you know, at some point. But that's what I noticed. They all take their money and invest it in these streams of income.

And the typical stream of income takes about three to five years of, I would say, massive. Investment in time and money. Uh, not always money, but definitely time. You have to, you know, my writing my books, they're a revenue stream now. That took a lot of time and it did take me about a hundred thousand dollars of income, of money spending, uh, the speaking gigs.

They were. You know, I invested in reaching out and saying, Hey, you know, I'm on CNBC Business Insider, you know, you might have seen Articles, success Magazine. And they said, oh yeah, we want you to speak. And that was an investment in my time in getting those articles out there besides the books, the articles that were published by these media outlets.

And that, you know, led to, uh, the speaking. Gig. So now I have, uh, probably, I mean, if you put the books all under one category, I have four streams of income, but I have books all over the world. So each book is a revenue stream. And, you know, I get a revenue, a royalty check from China. I get a royalty check from India.

I get a royalty check from this country, that country, you know, they all come at different times. And so they're all revenue streams that I use to, I typically pour it back into, you know, building my rich habits empire, if you will. And if you look at some of those things, so they invested back into their business.

Did you find that, um, there were wealthy people, you know, investing in real estate and stocks? Were there other areas that they were investing in outside of just business? Yeah. The savor investors in particular, there was a good percentage of them, maybe close to 35% of them invested in rental properties.

In fact, um, in my book, effortless Wealth, my friend Tom Howie, he's a very successful guy, but we grew up together poor on Staten Island and. Tom, you know, he and I became CPAs and we both worked for Arthur Anderson and he went off to go to college and uh, to go to law school and he, you know, became a patent attorney.

And anyway, he got lucky in life. Uh, through his hard work, his opportunity, luck. Paid off for him and he was able to retire. Well, I included some of the stuff that he did, you know, to invest his money. And so a lot of these save investors, they did have multiple rental properties and at some point they, uh, were able to free themselves from the slavery, the work slavery, and uh, they.

Just, uh, were managing their 4, 5, 6 properties and that was generating enough cash flow that they were able to live off of that. So that was kind of unique. Annuities. I saw a lot of, uh, this self-made millionaires that's, once they ga gained a certain amount of wealth, it was typically around three or 4 million.

They started investing in annuities as a, as sort of a pension way of creating a pension. 'cause there's guarantees and all that stuff with the annuities. And so they, that was another one. And I guess there's, I'm not a big. Fan of this type of investing. The, you know, the Bitcoin, I am a big fan of blockchain investing.

But the, um, you know, these, I see a lot of that going on now with a lot of my clients. In fact, you know, the CPA and CFP clients I have there. Oh, should I invest in Bitcoin? Should I invest in Bitcoin? You know, like, yeah. 15 years ago, so, right. You know, it's like you invest now it's, you gotta wait. If you think about it, Andrew.

Because I have a family member who invested $10,000 back in, I think 2013. Oh, wow. In Bitcoin. And he's probably worth, I don't know, 60, $70 million now I think. Something like that. And, uh, that's was the time she invest. My daughter, my daughter invested in Bitcoin only so that she, because they mandated she needed five bitcoins, she needed three Bitcoins to in college in order to get a fake, uh, ID.

You know, so that she could get liquor. Liquor. I was like, oh, it's the kids kind of kids. I raised, you know, Irish kids. They, of course they wanted to drink beer, and so, uh, she had two Bitcoins left over. She still does, I think have, I think she has one and a half left over or something like that. But she did that back in 2013 and that was the time to invest maybe 2015, 16, 17.

You can make a case for it, but, uh. You know, it's these investments that you're, are the leading edge, uh, investments like AI now. Anything you, yep. Anything. I believe Elon Musk is going to be the wealthiest man in the solar system because I believe he's gonna branch out into the solar system and more than just a rocket ships, he's gonna be mining stuff, he's gonna be doing all sorts of things that are revenue streams that we can't even understand that.

That don't exist today. He's gonna be doing that. He'll be so wealthy and ai, anybody that's uh, uh, you know, on the forefront of ai, if they're investing in ai, they're gonna be very wealthy off of that. It's the same when the internet broke out in like 19 93, 94 and 95, right when that exploded. Uh, people that invested, I had a family member that invested in Yahoo and she went from, you know.

$3,000 investment to a 350 $400,000 investment without doing anything. So, you know, that's, you gotta get in at the right time. And, and these people that have their fingers on the pulse of these new emerging technological industries, they're gonna be the rich people. Right. Exactly, and I think there's, so basically what you saw was mostly it was of various different ways that people were investing their money.

But the big key was making sure that you actually start to get your money to work towards something. Uh, and they had those multiple income streams, so they were looking to have a multiple income streams and hoping to have some of those kind of set up. And like you said, I love that stat that it takes three to five years.

'cause I think a lot of people want to kind of invest. Into an income stream that, and think it's gonna just happen overnight. Yeah. It takes a lot of time and effort and energy to kind of get that income stream stabilized. Mm-hmm. Then once it's stabilized, then you can probably take your foot off the gas a little bit or hire somebody to kind of help you, uh, with that business or whatever else.

But it does take that time and energy upfront. So I think that's a really important point, uh, that. Would help a lot of people just understand how this works. So when it comes to all this, I know we've kind of talked through some of the habits they have and some of the investing. Another big piece is the mindset.

Is there, you know, mindset shifts that someone needs to adopt if they want to become wealthier, if they wanna become rich? Or are there anything that you saw that a lot of folks had who were wealthy that were common? Yeah. So I had this poor habit, this mental poor habit of thinking that wealthy people were evil and, um, that most of them had inherited their money.

Turns out my study had 76% had created their own wealth. They came from poverty, or the middle class you had threw out a 79% stat. And there are other stats that are as high as 82, 80 3% that, you know, the wealthier self made. So, uh, it's not inherited money for the most part. Inherited money comes and goes.

It's usually one or two generations and it's gone. So you have to really, um. Want to become wealthy, you have to want to be more than you are. What's keeps you stuck is the thinking that I was born into poverty and um, I'm behind the eight ball and there's nothing I can do about it. And so your circum, you basically.

Have, you know, planted your flag on the notion that you got a raw deal and there's nothing you can do about, well, that couldn't be further from the truth. The, um, you can absolutely 100% change the circumstances of your life. The key to changing the circumstances of your life is to change your mindset, and the key to changing your mindset is to shift from negative.

Thinking to positive thinking and the key to shifting to positive thinking is to express gratitude every single day. Even like I expressed gratitude for three things that went right yesterday. Yesterday. I always look at yesterday, I say what went right yesterday. Three things I gratitude on my commute to work.

I oftentimes, I express gratitude for my car. I love my car, and it's an experiment. This is a car that, uh, when I found out that the most of the self-made millionaires, they kept their cars forever. Uh, I didn't, I always, you know, either leased or got a new car every five years or whatever. Uh, this car I bought in 2013, and my goal was from the get go, I wanna put 250,000 miles on the car.

So I'm at 208,000 miles now, and so I express gratitude every day. For that car, I expressed gratitude for every time I get to spend time with my family and my friends. I express gratitude every time I have enough money to do something, like take my niece out. We went into Thursday night, New York City, took her out to a nice restaurant.

We had a great time. I, if I didn't have money, I, I wouldn't have been able to do that, Andrew. So I express gratitude and what happens is. It's a shift, and I guess you could look at it from, you know, the glass is half full, the glass is half empty. Now you're looking at your life and you're saying, these are the things that I am grateful for, and these are the things that I want in my life.

When you express gratitude, you are actually feeding. You're sending a message to the universe, our quantum based universe, which is an important factor, meaning our thoughts are real. They're out there, they float around, they're in the quantum universe, and if you have negative thoughts, the universe is gonna deliver to you the things which you think about.

More often, I don't have enough money. Great. We're gonna make sure you continue not to have enough money. 'cause that seems to be something you think about a lot. I don't have a good car. My car always breaks down. Great. We'll make sure that your car keeps breaking down so the universe will give you what you keep putting out there.

And I mentioned quantum based because what they're starting to realize is that the universe is conscious, there's a consciousness to the universe and we're conscious beings. And so when we throw thoughts out there. Whether they're positive or negative, the universe picks them up, and the universe is a repository and a delivery system.

Our pineal glands in the brain is a, uh, cell phone. It sends out thoughts and it receives thoughts from the universe, friend from others. So you wanna have a positive mental outlook because that positivity. Is like an attractor, it's like a magnet. It pulls in more of the things that you want in your life because you're expressing gratitude for them.

And so when it comes to kind of your mindset shifts and like some of the ways that you're thinking about this, is there a way that millionaires set goals differently? Let's say for example, someone's listening to this and you know, you kind of talk through, Hey, my situation, I grew up poor. I don't even know how to manage money.

I'm trying to learn how to. Figure out my entire life and my whole situation, how can someone like that, you know, look at this and say, I wanna set some goals like millionaires do you, and I wanna make sure I can achieve those goals. How do they actually set goals differently than everybody else? Yeah.

Well let's talk about this. There's a such a big important point because what I learned from my research is that a lot of people set goals that are actually dreams, right? Dreams are broad-based wishes, things that you want in your life. Goals are the construction crew that make your dream come alive.

They basically, I have this dream of having this house down by the shore. I create all of these goals. I gotta write books. That's a goal. Uh, I've gotta write every day. I've gotta publish the book. These are all goals. I published a book. I've achieved my goal. Now I've gotta promote the book. That's another goal.

I have daily goals daily. I call 'em daily habit goals, goal habits, where every day I'm pursuing a specific. Goal as if it were a habit in an effort to realize my dream, if you think about your goals as rungs on the ladder and at the top of the ladder is the dream that you need to realize, right? So you set these goals, you achieve each goal, and you move yourself up the ladder.

And when you get to the top of the ladder, you realize. That particular dream. So you actually build goals around each dream. Each dream may require the realization of 3, 4, 5, or six goals. Now, the important thing about this is sometimes goals are unachievable because you lack the knowledge or the skills to pursue those goals.

I wanna be a CPA. Okay? That's a dream. Do you have the necessary, uh, skills and knowledge to become a CPA? Well, you've gotta study for the exam. First of all, you gotta go to college. You gotta get an accounting degree. Then you've gotta study for the CPA exam. And then in New Jersey, and in a lot of states, you have to have two years of experience.

So now you've, uh, done all of these things. You've achieved all of these sub goals that allow you now to pursue your. Getting a CPA, and then you realize your dream. You have all these rungs on the ladder that you climbed, and now you've realized your dreams. That the way I'd like to present it to the listeners is think of each dream as a ladder that you have to climb.

And in order to climb that ladder, you have to achieve all of these different goals. And once you achieve all of the goals, you will realize your dream. I love that. And I think that is, you know, it's one of those things that we have, this program we called. It's called Master Your Money Goals. And what we do is we kind of look at this in a way where we'll have a big goal and then we kind of dissect it backwards.

So we'll go backwards, okay, what do I need to do in a year to achieve this goal? You know, every single year, if it's a big, huge goal, that's a five year goal, what do I need to do each year to accomplish? Okay, what do I need to accomplish every quarter? What do I need to accomplish every month? And we break it all the way down to daily actions that you can kind of take.

And it's the thing that I think is just the best overall way to kind of move mountains because you can take one step every single day, take those daily actions. Just like you said, you wanna write an entire book, well, you're writing every single day and I'm sure you have like a certain amount you wanna write every single day.

And you're taking those simple actions each and every day to get to your next book. And I think that's just such a powerful way for that millionaires look at goals too, is they try to break them down into smaller chunks and take these daily actions. And it's just, like you said, it's just like following up a ladder, uh, and what is the next step that you need to take mm-hmm.

In order to get to that point in time. So I think that's such a powerful lesson that a lot of people can learn. Now when it comes to family teaching and family, I know, you know, back in the day, the Millionaire next door that we chatted about earlier has a lot of, you know, different things that they talk about when it comes to how millionaires kind of teach their family about money and how they teach them how to handle wealth.

Mm-hmm. What did you find when it comes to, you know, how do they teach their kids money habits, and how do wealthy people actually help their kids overall when it comes to learning about money? Yeah, so what I learned, and this is pretty profound, is that millionaires teach their kids about money in stages.

So when their kids are young and they're getting gifts, you know, I'm talking about like 7, 8, 9, 10 years old, 11, 12. They say, okay, you're gonna save 50% of that. That's going into a savings account. And then the next stage is, okay, well I want. A bike, or I want a video game, or I want this cell phone, and you say, okay, great.

You have a thousand dollars in your savings. You can use 50% of that to purchase. You know the thing that you want. And so it forces them to have skin in the game. The parents will pick up the other 50%, you'll pay 50%, but it teaches them, Hey, I've gotta save in order to get the things that I want in life.

My parents will help me. But that's another stage. You know, they teach them how to save and then how to. Use their savings to purchase the things that they want in life. Uh, the other stage is when they get into, like their junior year in high school, they start, these wealthy families start teaching their kids about insurance, car insurance, tenant insurance.

Well, they, they know they're gonna be going to college. And so health insurance, you know, you may have health insurance. At the college, uh, in some cases they may have supplemental health insurance at the college in case something goes wrong, and so they start teaching them in junior and senior year in high school.

They teach 'em about student loans. They teach them about college costs. They start teaching. They dribble certain bits of money, information. Financial literacy concepts at different stages. They just don't overwhelm them and say, okay, we're gonna do this. This is what you're gonna have 17 concepts of financial literacy, we're gonna shove down your throat.

And you know, I love this. Uh, I read a. Book on the Rocka, JD Rockefeller, who created Standard Oil and all that stuff and and Rockefeller Oil and standard oil. Anyway, they still have, because his son was so smart and created a foundation, a trust. A legacy trust that all of the Rockefeller descendants are beneficiaries of.

And when you are a Rockefeller at a certain age, and I think it's 18, you actually go to money training. They teach you about life. They, it's not just money, it's philanthropic. They teach you about a lot of things, but money's a big lesson that they learn how to manage your money. You're going to get a stipend.

It's not gonna be enough for you to live off of. You're still going to have to work. But now we're gonna help you manage this stipend that you're gonna get and we expect you to tie, you know, 10, 20% of that money and we expect you to, you know, with the other 80% to do. Productive things with it, you know, go to college, do this, do that.

So they teach them, they actually take 'em through like a Rockefeller course and I thought that was really interesting. That's a way to create a legacy for generation after generations, you know, by teaching, you know, if you teach your kids, there are basically 17 financial. Concepts you need to understand to be financially literate.

If you teach your kids those 17 concepts, they'll teach their kids and their kids will teach their kids. And so you don't need a Rockefeller trust. All you need is the knowledge. And the kids will be, you know, financially, you know, free, you know, they'll be able to Right. Build their own financial freedom.

And I think the Rockefellers have so many cool stories about like how they taught their kids. And one is, I think they're the family with the longest tenured, you know. Ability to kind of preserve that wealth over time. Mm-hmm. And I read in that it might've been Titan is is that the book you read? Yes, that's the book.

What a book that was. Right. It's it's incredible. Yeah. And I think, um, in that book, it's, there's a part of it. I remember that he was kind of talking through where the younger kids would get an allowance and sometimes they get this allowance and if they did not report back, you know what they actually spent their money on that they did not get their allowance.

The next week they actually had a set like. Basically a mini budget even when they were younger. And so I remember kind of thinking through that. And I have a 7-year-old, a 4-year-old, and a seven month old right now. And I start them at age two and three, I get three jars and I said, save, invest, and give are the three jars, and we label 'em.

And so each time they start to earn the amount, whatever age they are, that's how much they'll earn an allowance. We have all these like different things that they do outside of their normal chores. And so they'll get, you know, a little bit of money coming in and they have to kind of budget that money out in these jars.

And this is why I truly believe in the stage thing that you're talking about here, because. When they're younger, you can kind of teach them in that stage. And then as they get a little bit older, you teach them more and more and more and start to trickle that in, you know? And as it's just a very interesting thing.

It's so incredibly important for any parents listening out there to teach your kids how to handle money. First you have to understand how to handle money, but then. You need to teach them how to manage money properly because that is a multi-generational, uh, lesson that you can teach them, which is what Tom is talking about here.

'cause I think it's just so incredibly powerful what you can do there. So, and it's really just making sure that they aren't dependent on you as they become adults. Because as you know, time goes on, it is one of those things that they need to be self-sufficient in order to really, uh, get a head start in life.

And I think it's just so incredibly powerful. So is there something. If someone's listening to this, they're like, this is amazing. I wanna start developing some of these habits. Are there, you know, two or three habits that you would recommend for them to kind of focus on right away, uh, if they're starting from ground zero that you think that most millionaires, uh, have had the biggest impact with?

Yeah, the number one thing I would tell them, and it, it doesn't involve money, is to start building relationships with other successful people. In other words, evaluate your inner circle. Who's in your inner circle? How many of them are successful? Is it one? Is it two? Typically it's one or two. And then I would say to them, you want an inner circle where you got five people who are successful?

So have an inner circle with five people who are successful. And the reason is, Andrew, is if you start spending time with those five successful people, you are gonna learn things from them. You, they're gonna teach you through their habits. They're gonna drop little nuggets here and there, and they say, well, we did this and we did that, and this is how we were able to save for our house and this is how we save money.

To reduce our spending so that we can save for the house. And, uh, if you're a savor investor, if you have that savor investor mindset, and that's a personality trait, that's typically somebody who's, you don't have to be extroverted. You, you know, you're not typically introverted, you're just an average person, but you're, you know, you're kind of conservative.

You don't like spending money. You have this. Fear actually of being poor. So, you know, you save like crazy. If you have that kind of personality trait where you're not gonna take these significant risks, like entrepreneurs and big company climbers do, then, uh, surround yourself with frugal people. Have the people in your inner circle if you're gonna pursue the s investor path, have those people in your inner circle.

Be investors. If you're gonna pursue the entrepreneur path, have five people in your inner circle that are entrepreneurs. If you're gonna be the Virtuoso or the big company Climber Path, have five people that are pursuing those paths because you're gonna learn from them. They're gonna be almost like mentors.

And what I found in my research is the fast track to wealth is mentorship. If you can find somebody that can teach you what to do and what not to do, within 12 years, you will become wealthy. If you find a mentor who's successful, they'll teach you the habits. They'll teach you the thinking, they'll teach you the shortcuts.

Uh, they'll tell you what to do and what not to do, which saves an enormous amount of time. And, uh, in 12 short years, you will actually have some wealth. And so that's, I'll leave it there. That's, uh, kind of summarizes everything there. For sure. And I think building up that network is just so important.

Like Tom said, at least having that five. And if you are in like an area where you say to yourself, okay, I don't have five friends who are trying to be on the entrepreneur path like I am, what I would even consider doing is thinking through, okay, is there a way for me to, you know, start an entrepreneur club or something like that in your local area where maybe just meet at a coffee shop once a month, uh, with this group and you can start to, you know, share business ideas and that is gonna start to develop some of these relationships that I think can really, really help you over time.

Um. If you're looking at this and you're just saying, I don't even know where to start. Well, you can start by, Hey, in your neighborhood, are there any entrepreneurs? Put it in your neighborhood Facebook group or whatever else, and just kind of get that ball rolling so that you can meet other people that are having the same goals and ambitions as you are so that you can share ideas.

And I think that's just so important for most people Now. We've talked about all the rich habits that people should be doing, are there any habits that you have seen from people that they should be avoiding at all costs if they want to be able to build wealth? Yeah, so there's, so, you know, one of what my books is Rich Habits, poor Habits for specifically for that reason because you know, the media and everybody likes to focus on, you know, how do you build wealth?

Nobody wants to talk about what not to do, right? And one of the things that I found in my research is that poor people have a habit. It's a really bad habit of gossiping, and it's always negative gossip. They also have a habit of saying whatever thought they have, it comes immediately outta their mouth.

Rich people don't do that, or self-made millionaires don't do that. They vet every word that that before comes outta their mouth because they want to build relationships. Whereas poor people aren't focused on building relationships. They're just pissed off at life, and so, you know, they're not. Looking to build relationships.

So they say what's on their mind. And my aunt Peg had this bad habit and she used to brag about it. And I used to think it was, you know, a good habit. You know, I always say what's on my mind, but when my Aunt Peg died, the only people you know at the wake in the funeral were family and a handful of our neighbors.

Right. She didn't have any friends 'cause she pissed everybody off, uh, because she said what was on her mind. You can't do that kind of stuff. And the other thing is the poor people, I'm talking about lower middle class, poor people. Because lower middle class is still poverty 'cause you're living paycheck to paycheck.

They have this nasty habit of seeing someone has something that they desire and they must have it, even if it means going into debt. I'll give you an example. I was doing a speaking gig and at the end of the speaking gig, this IRS agent came up to me. She told me that she had just leased A BMW and it was costing her 600 $5,700 a month.

And she, they, IRS agents don't make a lot of money. And so I said, why did you do that? I don't understand your thinking there. And she said, well, my friend who I live with, uh, she had a girlfriend or a roommate. She worked for like Goldman Sachs or something like that. And. I think her roommate bought A BMW and so she couldn't buy A BMW, so, 'cause she didn't have the money for the down payment, so she leased it and she said that I just got caught up.

I just wanted to have what she had. And I'm with her every day and I see her driving around in A BMW and, you know, everybody thinks how successful she is. I just wanted some of that praise and, you know, I said, oh, but I, so I helped her. Uh, get out of it. 'cause I'm a CPA and I helped her get out of her lease.

We worked on that together and she got out of her lease and ended up getting like a. The same car that I have, a Hyundai Elantra or something like that. And so, you know, it's that kind of stuff. You see what other people have and it's really bad with Facebook and with, you know, TikTok and right. All these social media sites, you see people, you know, Hey, look at me, I have a cocktail, and they're on the beach.

And the next thing you know, you're, you're on the beach with a cocktail and it's $5,000 on your credit card. That's just, that's a bad habit. And I also found that the, the poor people, they just did not have any growth habits. They didn't read to learn. They contributed to nonprofits, you know, charities, but they weren't involved in a lot of nonprofits.

I saw that more with the middle class and upper middle class in addition to the wealthy people they got more involved in. But the poor people, the lower middle class people, they just, uh, they didn't have the time. And, and the reason, one of the things I wanna address here is they just don't have bandwidth.

Mental bandwidth because they are literally just trying to survive and they're trying to figure out how to pay this bill, how to pay that bill so they don't have the bandwidth. So I would say to them, look, you're struggling with bandwidth issues. The only way to get some clarity and to be able to think your way out of this mess that you're in is you've gotta sit down for 15 minutes a day in the morning before anything starts, end silence and just think.

In silence and think about what you want in life, how you want your life to change. Just that's 15 minutes is for you to dream and fantasize and pretend that you're going to have this amazing life. You need that 15 minutes. It's like, um, putting a new battery in your brain and. If you are struggling with bandwidth, you're never gonna be able to think your way outta your problems.

You have to isolate time every day and think clearly. And the only way to do that is to stop thinking about all your problems. 15 minutes a day is all it takes. Gain some clarity on. Your subconscious will start giving you, feeding you with information on how to solve your problems. Trust me, the brain is an amazing device.

It's her sender and a receiver. You'll start getting ideas from all throughout the universe, from other people around you. They'll be filling your head with ideas on how to solve your financial problems. Absolutely. And I think it, that personal growth piece is just so important, especially if you're listening to this and you're in, you know, you're just starting off, or you are someone out there who is just like, I cannot get ahead ever.

It's investing in yourself and that personal growth is just gonna absolutely change. Uh, and it's gonna jumpstart your. Path to becoming a millionaire or becoming wealthy. And I think that is just one of the big things overall. So I wanna shift gears here really quick to some of the rapid fire questions wed love to ask our guests, Tom.

'cause I think you'd have some really, uh, interesting insights on some of these. So if you could tell your younger self one thing, what would it be? Well, I would tell myself two things. One is start writing now. And focus on school to get better grades. I was always a B student. I did what I had to do to get a b.

I just, uh, was sports addict. I just wanted to play basketball, baseball, tennis, every sport you can imagine, swimming. I did everything. I would say, you know, focus on your grades, not so much on your sports, and start writing now because I, the thing with young people is you don't know what your innate talents are until you.

You know, um, maybe you find them later in life, but I discovered that I had this innate ability to write. I just have it, it's a talent. And I discovered that at age 48 years old. I wish I knew that at 18. I love that. What is your best money advice you've ever received? Same house. Same spouse, same car. This really applies to the saver investors, which happen to make up about, uh, 51% of myself made millionaires that advice.

If you follow that advice, and by same car, I don't mean obviously not the same car. I mean, drive your car, own it, and drive it until and take great care of it. Yep. Change the serpentine belt. You know, change the timing belt, change the oil all the time, you know, do all the things that you have to do to keep your car running, and you'll get 10, 12, 13 years out of your car.

So same house, same spouse, and same car. A hundred percent agree. We have a car buying rule and it's called the 24 12 10 rule, but that last number, that 10 it stands for, you need to drive your car for 10 years or longer if you want to actually maximize the value and all that stuff. So that, I love that.

How do you plan to level up your finances this year? So I have a new book coming out in August in China. It's uh, rich Habits Wealth Academy. It's going, it's really, I was thinking about it being a course. And I was gonna charge whatever for the course, but, uh, I got, uh, somebody in China, my books, I've sold so many books in China so far, more books than I've sold in every other country.

So, uh, they were really, um. They wanted a book and I said, I got one for you, but it's a course and I modified it. So that's coming out in August. China has always been really kind to me. So I don't know. I have no expectations on any of my books. Never. Uh, but, uh, I've had success in China, so that's my, I'm gonna level up a little bit with that book.

That's a big important book. Awesome. And then what does wealth mean to you? Oh, freedom. It means freedom, freedom of time, and, uh, freedom from worry, financial, worry. I love it. So, Tom, thank you so much for being here. This is absolutely incredible and I think, you know, I know I learned so much and I know our listeners are gonna love this as well.

Where can people learn more about you, your books and everything else you have coming out? Yeah, just go on Rich habits.net. I, uh, write, uh, almost every day. So I have an article that comes out. Uh, it's always based on my research. I'm continuing to do my research. I, I don't stop, I do it about an hour and a half every day of research.

So I come out with these articles and, uh, sometimes my media interviews I'll throw on there. But, uh, you can subscribe. There's no cost, and we don't sell you, you know, your name or anything like that. We just, I really don't give a crap about that stuff. So, yeah, you'll get an email from me every day that says, this is, uh, you know, one of my articles and you can read it or not read it, whatever.

Awesome, and we'll link that up down in the show notes below as well. Tom, thank you so much again for being on here. We truly appreciate it. Uh, thank you Andrew. It was great interview. Thank.