Over the course of five years, I studied the lives and the money habits of 361 people, including 233 self-made millionaires, and I shared my findings in three books, "Rich Habits," "Change Your Habits, Change Your Life," and "Effort-Less Wealth."
More than two thirds, or 76%, of the millionaires in my study were self-made. About a third of that group, 31%, described their backgrounds as poor, and 45% described their upbringings as middle class.
No matter their background or industry, I found that one of the most common traits among self-made millionaires is their ability to create multiple streams of income. Every single one of the self-made millionaires in my study started small, adding one new income stream at a time.
Sixty-five percent of the self-made millionaires in my study had three streams of income, 45% had four streams of income, and 29% had five streams of income. Each additional stream they added gave them wealth that they could then leverage and invest into another.
There are a number of ways they generated passive income, including real estate rental income, website ad revenue, paid blog subscriptions, online courses through platforms like Teachable, royalties from book sales, and investing in stocks, bonds, and mutual funds that yielded dividends, interest, and capital gain income.
Ultimately, it took the average Saver-Investor millionaire in my study 32 years to become wealthy. The majority of the self-made millionaires in my study hit the millionaire mark between the ages of 46 and 60. The interests and industries of these millionaires ranged from cooking and pet care, to home improvement and carpentry, to law and real estate.
Of course, building wealth takes time. But it helps to start as soon as you can, and to lead with your strengths.
If you have a consuming 9-to-5 job and/or other sorts of commitments at home and at work, carving out the time to devote to starting another income stream might seem daunting. Based on what I've learned from my research, you can start small: Set aside no more than five hours each week and begin slowly building something new.
If you're not sure where to start, think about the subjects, skills, and activities you are most passionate about, and explore the ways that you could monetize one of those.
In my research, other than consistent saving and investing, passion was by far one of the most important shared attributes of the self-made millionaires in my study.
Video by Stephen Parkhurst
In addition to passive streams like real estate or stock market investments, many of the self-made millionaires in my study also created side hustles that would be considered active income, meaning they devoted 10 hours or more a week to growing the side hustle over many years.
Over the years, they kept scaling their businesses until the cash flow matched the income they were earning from their full-time jobs. At that point, they quit their 9-to-5s and spent 100% of their time growing and managing these businesses. And these side hustles accounted for a wide range of interests and expertise.
Video by Courtney Stith
My study participants included a start-up advisor, a business plan developer, an angel investor, a taxidermist, a lighting distributor, a professional speaker, a few real estate investors and house flippers, a songwriter, some authors, an app developer, a personal trainer who ultimately opened a string of gyms in New Jersey, and the founder of an online pet store that became a thriving brick and mortar business.
Some of those side businesses were offshoots that used the core skills the participants developed in their full-time jobs. Some decided to pursue things like real estate investing. Others started businesses related to dreams they pursued that had nothing to do with their current industries. But it took some trial and error to get to that point.
Think of a side hustle or new stream of income not in a vacuum, but as an investment in yourself. As you make these plans, consider what you want to use that money for once you make it.
Whether it's a down payment for home, a college fund for your kids or future grandkids, or saving and investing enough to be able to retire early, articulating this goal will make it easier to focus and reap the rewards of your work.
I've observed that when the millionaires in my study pursued something they were truly passionate about, it inspired them to find the time to make it work.
Don't be afraid to start experimenting now, and to share what you are enthusiastic about. You never know who it will connect with. Take action and invest in yourself today to create the future life you desire.
Tom Corley is a CPA and a certified financial planner who holds a master's degree in taxation. He is the bestselling and award-winning author of "Rich Kids: How to Raise Our Children to Be Happy and Successful in Life" and "Rich Habits: The Daily Success Habits of Wealthy Individuals."
More from Grow:
- The 6 most common retirement planning regrets, and how to avoid them
- Millennials hope to retire at 61: Here's how much money those who are saving have so far
- I started a side hustle with a Craigslist ad and $250: Now it makes six figures