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You earned, you saved, you invested – and you can finally call yourself a millionaire.
But what do people actually do after they make their millions? Surprisingly, most don’t just lounge on beaches or charter jets around the world.
The habits that helped make them rich in the first place tend to continue even after the money starts rolling in. Here are nine of the most common things wealthy people do after they become rich.
1. They continue working
You may expect all wealthy people to quit their day jobs and retire as soon as they get rich. But in reality, most continue working — or making an income — in some capacity.
Rich people may scale back their roles or take more vacations but rarely give up work completely.
For many, working is not about the money. Work provides meaning and keeps them engaged. Working can even expand their networks to find new financial opportunities. Many successful entrepreneurs can’t imagine giving up control of their passion projects.
As the saying goes, “Love what you do, and you’ll never work a day in your life.”
2. They live below their means
Casey T. Smith, president of Wiser Wealth Management, highlights a key difference between being rich and being wealthy.
“Rich people make a lot of money and spend it,” he says. “Wealthy people have rich incomes which they are able to save to become wealthy.”
Making money shouldn’t automatically translate to spending money. Instead, Smith says that the “not-so-secret” formula involves maintaining a frugal mindset.
“Some of our biggest clients drive Hondas and Toyotas,” Smith says. “They have no debt and live well below their means.”
3. They look for new ways to make their money work harder
The most common thing you’ll see wealthy people do is continue investing their money. The phrase “it takes money to make money” applies here.
Rich people know that growing their wealth often requires investing money into assets that will appreciate over time. This means investing in stocks, bonds, real estate, and businesses. The investing habit that made them rich continues even after they’re wealthy.
Plus, rich people often find room for improvement. Research from Northwestern Mutual shows that 84% of American millionaires have a financial plan. What’s more, 47% see an opportunity to improve their plan.
Setting financial goals and making a plan to achieve them is a key step in building — and retaining — wealth.
4. They diversify their investments
On top of just investing, the rich diversify across numerous types of investments. By allocating their money across stocks, real estate, commodities, and other assets, they can lower risk while seeking growth.
Wealthy people aren’t just looking for a mix of stocks and bonds. According to real estate consultancy Knight Frak, wealthy investors invest more in real estate than equities.
Owning real estate is another chance to develop an income stream. Around 70% of rental properties in the country are owned by individual investors.
5. They maintain a healthy emergency fund
Wealthy people aren’t putting all their money into investments. They recognize the importance of keeping a sizable chunk in an emergency fund to deal with worst-case surprises.
The same Northwestern Mutual research found that 91% of American millionaires plan for unexpected financial and health challenges.
Even high-net-worth individuals realize the importance of liquidity and risk management. Many may keep anywhere from six months to two years of living expenses readily available. This ensures they can cover unexpected costs and avoid liquidating assets during times of crisis.
Emergency funds can help anyone weather unexpected financial storms. Here are some tips to build up your savings — and where to store your rainy day fund.
Wealthy people likely aren’t keeping that cash in an account that pays next to nothing, though. They often use a high-yield savings account to earn a higher return on that money.
6. They use their credit cards for most purchases
While the wealthy certainly have ample cash to spend, they tend to use credit cards for most purchases.
Putting expenses on credit cards has multiple advantages. First, it allows them to earn rewards points, airline miles, and cash back on this spending.
Over time, these perks can add up and be used to book free travel or access other rewards.
A recent survey found 49% of Americans with a net worth over $1 million have a travel rewards credit card, compared to 23% of Americans with a net worth below $1 million.
Here are some other common credit card habits of rich people.
7. They splurge on education and self-improvement
The rich may pamper themselves on luxury travel but also invest in their health and wellness.
Healthcare becomes a top priority not out of medical necessity but to maintain quality of life. Preserving health lets the wealthy enjoy their money for as long as possible.
Self-improvement is another common trait among the wealthy, even after achieving financial independence. They continue educating themselves and improving their lives. Education unlocks new conversations and experiences that money alone can’t provide.
8. They focus on experiences
Ask a wealthy person if they care about buying more products like luxury watches and high-end handbags, and you might get an eye roll. Instead, they want to go see the world.
According to a recent Schwab survey, 70% of people believe wealth means enjoying experiences – compared with 30% who associate it with owning nice things.
For many rich people, making new memories is more important than keeping up with the Joneses.
“There is a saying that says, ‘The fastest way to lose your money is to be obsessed with showing people how much money you have,’” says Elliot J. Pepper, certified financial planner at Northbrook Financial. “Excessive spending is a surefire way to lose millionaire status for people who aren’t balanced in spending behavior.”
9. They spend a lot of time thinking about something other than money
Many millionaires don’t constantly monitor their investment accounts or stay at the office until dark. (Well, some are, but you probably don’t want to be one of them.)
Instead, they’re nurturing the relationships in their lives. The same Northwestern Mutual research found that 87% of American millionaires feel strongly or very strongly about their relationships.
The lesson is simple: You can be lucky enough to call yourself rich, but cash may not matter unless you have someone to share it with.
“A person should ask themselves, ‘Great, I made it. Am I happier now?’” Pepper says. “Shiny toys and lavish meals are fun but fleeting. Part of being ‘rich’ is not just the financial definition, but, more importantly, it is living a rich life.”
The bottom line
Being rich feels good, but you know what feels even better? Staying rich. If you feel wealthy today, use it as a source of inspiration to stick to the habits that got you here in the first place.
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