5 Habits of Self-Made Millionaires, According to Vivian Tu

Bald person with beard stands in office with creative colleagues, smiling at camera.

Image source: Getty Images

Becoming a millionaire might seem like a lofty or even impossible goal. The truth, however, is that many millionaires are self-made. And they build their wealth largely on the back of good money habits.

Vivian Tu, also known as Your Rich BFF on social media, says she became a millionaire at age 27. She recently published a video on YouTube where she revealed five habits of self-made millionaires. They're all excellent habits that can make a real difference in your financial situation.

1. They focus on making as much money as possible

Self-made millionaires are extremely proactive about increasing income. Some of them have their own businesses, and some work for others as employees. But what they all have in common is that they continually try to earn more and more. They work hard, they aim to be top performers, and they seek out raises or promotions.

This is a must, because as Tu puts it, "you can only save as much as you earn." Although being frugal can help you save more, it only goes so far. Eventually, you run out of expenses to cut, or it starts to affect your quality of life.

Income matters. You can save a whole lot more making $80,000 per year than $40,000. You don't need to make a massive salary to become a millionaire, but you should aim to consistently increase your earnings.

2. They invest

There's only so much that a person can work. Self-made millionaires also make sure that their money is working for them. They do this by investing their money so it can grow and bring them passive income. Even when they're not working, their money is.

There are many ways to invest. Arguably the most effective is investing in the stock market. This provides great returns at a relatively low risk. Over the last 50 years, the average stock market return has been 10% per year.

Anyone can invest, and it doesn't take a lot of money. To get started, open an account with any of the top online stock brokers. Then, you can choose investments. If you want to keep it simple, index funds and exchange-traded funds (ETFs) are an easy way to invest. These contain a basket of stocks, so you get a diversified portfolio with just one investment.

3. They practice discipline and delayed gratification

Tu says the one difference she has noticed in her friends who are self-made millionaires is that they're more disciplined and better at delaying gratification. They avoid overspending on things they don't need, especially when they're young, allowing them to invest at a young age.

That makes a huge difference. If you start at 20 and you want to retire with $1 million at 65, you could get there investing $116 per month. But if you get started at 40, it's going to take $847 per month.

There's nothing wrong with spending money on yourself. In fact, it's good to set some money aside every month for guilt-free spending. The key is to balance that out by consistently saving and investing money, as well.

4. They acknowledge when they're wrong and move on

Everybody makes mistakes. You can find plenty of stories about millionaires who have gone through business failures or made poor investments. What makes successful people different is that they're able to change their minds quickly on a bad idea.

This is a good habit to improve at personal finance and at life in general. Lots of people struggle with changing their minds. Once they have a plan or an idea, they cling to it. It's important to recognize when something isn't going to work so you can move on and not waste your time or money.

5. They set ambitious goals

Most self-made millionaires are all about planning. As Tu puts it, "You don't become a millionaire if you don't make a plan." Successful people set goals, and just as importantly, they set ambitious goals that will be challenging to reach.

Along with their goals, self-made millionaires also create plans with concrete steps they can follow to get there. For example, maybe you want to be a millionaire by a certain age. Next, think about what steps you'll need to follow to complete that goal. These will likely include things like investing a set amount per month and regularly raising your income.

Self-made millionaires aren't an exclusive group, and they don't have special traits that ordinary people can't develop. If you work on building those five habits, they'll help you take some big steps financially.

Alert: highest cash back card we've seen now has 0% intro APR until 2024

If you're using the wrong credit or debit card, it could be costing you serious money. Our expert loves this top pick, which features a 0% intro APR until 2024, an insane cash back rate of up to 5%, and all somehow for no annual fee.

In fact, this card is so good that our expert even uses it personally. Click here to read our full review for free and apply in just 2 minutes.

Read our free review

We're firm believers in the Golden Rule, which is why editorial opinions are ours alone and have not been previously reviewed, approved, or endorsed by included advertisers. The Ascent does not cover all offers on the market. Editorial content from The Ascent is separate from The Motley Fool editorial content and is created by a different analyst team.The Motley Fool has a disclosure policy.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.


More Related Articles

Info icon

This data feed is not available at this time.

Sign up for the TradeTalks newsletter to receive your weekly dose of trading news, trends and education. Delivered Wednesdays.