Million Dollar Net Worth Is More Common Than You Might Think

One Million Dollars

When a person claims to be a millionaire online it still inspires disbelief for some reason. Too many people seem to not understand that a million American dollars is quite frankly not a lot of money.

As someone who went over a million, and back under it, more than a few times in my life, I'll explain both, how easy it is to accumulate it and how easy it is to lose it. Including some, perhaps valuable, statistics (USA based as nearly 90% of my business is with residents of USA, so I do not bother with statistical data for rest of the world nearly as much).
First some facts.

1 in 10.1 households in USA have net worth of over 1 million if we include real estate. That number drops to 1 in 20 if we exclude real estate.

Problem with counting real estate is that price fluctuates, a lot. You might purchase a home valued at 750,000$ and five years down the line there might be too many homes on the market, few people on your block lose their homes, sell them too cheaply, and significantly lower income families move near you. Now ALL homes around your area drop in price and best you can hope to get for your home might be 450,000$. Usually its enough to simply have someone near you begin renting to people who might be noisy, not take care of their yard, and you might be unable to sell your home at all unless you drop price even more.

Buying power of a million dollars changed a lot as well. In 1950's one million was what today is 8-9 million.

Poor people have this delusion that almost all wealthy people started off wealthy, but that is not true at all. Over 80% of people who have millions today were born relatively poor.

Less than 33% of millionaires work for someone else. Majority are self employed. Those who work for someone else are unlikely to ever be able to comfortably retire, and when they do retire their lifestyle will take a serious hit. Safe investments simply do not have large enough return on your money. Most people who invest in stocks and bonds actually lose money over long period of time. Partially due to broker fees (you have to pay whether you are making or losing money), and partially due to fact that inflation tends to be much higher than your growth. Even when successful you might be only making around 2% a year.

To lose your millions all you need to be doing is spending more than you are making. Sounds like common sense yet first two times I went over a million it was for a very brief period of time. I wanted to show off. After all, I grew up very poor, and managing money is a skill you need to learn. It was expensive set of lessons.

To make a million all you need is one good day worth of sales. Whether your net profit will be one million is entirely another story, but to actually get, temporarily, over a million in your account is lot easier than you might think.

Reason why most poor remain poor throughout their entire life is because they are fairly stupid. They think that they can sell their own time for money (aka being employed and/or wage slavery) and somehow get ahead in life. But by doing that they place artificial ceiling on their income. There are only so many hours you can work each week, so your maximum income will be that # of hours times your hourly wage, plus perhaps few bonuses like overtime.

For those like me, a million is just a beginning, just a taste of possibilities future brings.