Imagine, you get out of bed in the morning, stretch out and you are a millionaire! What consequences would this have on your working life? Do you have to work long hours to be successful?
79% of millionaires are self-made and work an average of 47 hours per week. In comparison, the average full-time wage earner in the US works 37.6 hours per week.
Millionaires also have more autonomy and control over what they work on. This allows them to effectively multiply their time by working on income-producing assets rather than just hourly wage.
What Do Millionaires Do With Their Time?
With the average millionaire spending about 10 hours more every week working, is it just how much they are working or what millionaires spend their time working on? There are a few differences in what millionaires spend their time doing.
While working millionaires generally have more autonomy in their work. This means they have more control over when and what they do. In comparison, an employee is given a task(s) to complete throughout their workday.
The ability to control what and when a task needs to be completed is a big advantage when working to become a millionaire. Combine that with a higher than average workweek and you can start multiplying your time.
millionaires work more: At approximately 47 hours a week, persons, who are in work, in this group indicate to work around ten hours more than the respective population
Because millionaires create autonomous assets that are producing income besides just wage income from hours worked they can start multiplying their time and continuously increase their income.
The Relationship Between Time And Money
Once you understand this one thing about time and money, you can greatly increase your likelihood of becoming a millionaire!
Time Is Money! As the old saying goes, time can be used in several ways one of which is converting your time into money. You do this every time you go to work and get your paycheck.
You spend time working and offer a service or product for that time. Then, you received that “time spent” in the form of money. (a paycheck)
This is important because by holding that money you keep your “Spent Time” as a tangible good. (money)
You have the option to spend the money you earn on other products or services or you can use that money to INCREASE the hourly pay you received for that time.
For example, if you work 5 hours for $20 an hour, you will have earned $100 for your time (ignoring taxes). If you buy $100 in groceries your time (and money) will be gone. But, if you invest that money you can increase your hourly wage from $20 to significantly more.
A simple investment such as in the S&P500 has proven to produce a 100% return in about 8 years. If you invested your $100, (5 hours at $20/hour) after 8 years you would have $200.
This also means you multiplied your time.
Your 5 hours spend earning money was now worth $40, not $20!
How Millionaires Multiply Their Time?
Multiplying your time spent earning money is the key to becoming a millionaire and is why millionaires can earn significantly more money than the lower wealth classes.
Income-producing assets are assets that produce cash flow, Capital gains, dividends, or other sources of appreciation. Some of these assets can be created through sweat equity (working) while others can be bought.
Building your own business would be using invested money and time or “sweat equity” to produce income.
Millionaires do a lot of investing to multiply their time and increase their income. This is how they became millionaires in the first place. With 79% of millionaires being self-made it’s not unreasonable for you to become one as well.
By working a little more (millionaires average 47 hours/week) and multiplying your time through investments you can earn your first million faster than you think.
What Do Millionaires Invest In?
Of the Multi-millionaires, 73% are self-employed and only 19% of the wealthy are self-employed. (German Institute for Economic Research ) This leads to the conclusion that millionaires are investing in their businesses.
Actually, in terms of Assets, the German Institute for Economic Research study showed that the upper percent of wealth have a few main wealth sources.
With an average Total Asset value of $3,126,997 Euros, the top asset classes for millionaires are; Business Assets, Investment Properties, Personal Residence, and Financial Assets.
As you can see, millionaires have most of their wealth tied up into income-producing Assets. Of the major assets held by millionaires, business assets held the most value.
While for the lower net worth classes, the primary asset is their personal residence or vehicle.
Neither, personal residence or vehicles are income-producing assets. So to understand why millionaires have increased their wealth beyond the other classes comes down to asset allocation.
Millionaires invest their time and money into assets that are going to produce income and increase their time value or “hourly wage”
As Warren Buffet said:
If you don’t find a way to make money while you sleep, you will work until you die
What Should You Do?
Now that you can see how millionaires spend their time and money, you can start to replicate this for yourself. You don’t need to quit your job and start a business but, you can start using your money to acquire income-producing assets.
This, over time, will multiply into significantly more income so you too can become a millionaire!
Multiply your time by investing and producing more income, that’s the secret to wealth!