How to Become a Billionaire

How to Become a Billionaire – No one wants to be below their peers; everyone wants to make more money than their friends. But don’t you think its better to think of becoming a self made billionaire?

There are people in this world who have already realized their dreams of becoming a billionaire. It can be much easier to do than you think, but the first step is to figure out exactly what you want to do to become a self made billionaire. You might already have an idea for that big idea, but don’t just jump into it without doing some research. There are many ways that can make you a self made billionaire and it will vary based on your age and the resources you currently have. Once you know how becoming a self made billionaire can help your life and those around you, it isn’t as difficult as you had previously thought.

How to Become a Billionaire

Creating Opportunities

1. Study hard. Normally, billionaires don’t happen by accident. Be a billionaire by studying interest rates, tax brackets and dividends.
   • Study finance and entrepreneurship. Learn to identify consumer needs, then develop business models to fulfill those needs. Currently, computer science skills and new technology are lucrative careers.^[1]
   • If you haven’t heard already STEM jobs (Science, Technology, Engineering, and Math) are going to be on the rise and are already on the rise. Taking “STEM” classes to be able to increase your chances of getting a job in the future, as well as they are fields in which the pay check has almost no limit.
   • Read about successful billionaires; Warren Buffett, Bill Gates or Jon Huntsman, Sr. Be wise with money to amass more.
2. Save money. It takes money to make money. Set aside a specific amount of money from each paycheck and put it in a savings account, to collect interest and use for future investments.
   • Decide what percentage of earnings to spare – as little as $20 per paycheck will make a difference over three or four years. Invest money you can afford to lose in a high-risk investment.
3. Start an Individual Retirement Account (IRA). Available from financial institutions, IRAs are customized financial plans, set up to save for the future. To save a billion dollars, start saving as soon as possible. Interest accrues on savings.
   • Depending on the financial institution, a minimum amount of money may be required initially. Research options and talk to a financial advisor.
4. Pay off your credit card debt. It’s hard to get ahead with debts hanging over head. Student loans and credit card debt should be paid off as soon as possible. Average annual percentage rates vary between 20% and 30%, so the balance will continue growing.
5. Make a five-year plan. Estimate how much money to save over 5 years. Decide the best way to use money, whether it’s investing, starting a business or allowing money to collect interest.
   • Keep finances a priority. Write financial goals down and refer to these regularly. To stay interested in financial projects, write reminders and put them where they will be seen every day – for instance, on the bathroom mirror or the dashboard of your car.

Investing

1. Buy real estate. A common way to make money is investing in real estate. Property may gain in value over years, and may provide a good return on investment. Investments can be flipped, rented, or developed.
   • Beware of investing during an artificially inflated market, and make sure the monthly mortgage is easily affordable. It would be a good idea to read about the 2008 sub prime mortgage crisis in the United States to learn from cautionary tales.
2. Invest in business. Starting your own business or buying into one can be a solid way to make money. Create or choose a company that offers a product or service that you would buy yourself, and put time and money toward improving it. Learn about the industry to differentiate good and bad business investments.
   • Investing in green energy and computer technology may be a good plan for the future. These businesses are projected to grow over the next decades, so investing now may be a smart investment.
3. Buy and sell stocks. The stock market may be a good place to increase wealth. Watch the markets carefully before buying and pay attention to which stocks are successful. Be informed to make smart purchases. Most stocks appreciate over the long term. Ride out small dips in value and take occasional risks.
   • Dividend reinvestment plans (DRIPs) and direct stock purchase plans (DSPs) bypass brokers (and commissions) by buying directly from company agents. These are offered by over 1,000 major corporations. Invest as little as $20-30 per month; fractional shares of stocks can be bought.
4. Open Money Market Accounts (MMAs). These accounts require a higher minimum amount than regular savings accounts, but accrue twice the rate of interest of a savings account. High-yield MMAs are somewhat risky–withdrawing the money and affecting its investments are limited–but it’s a good way to allow money to grow by doing, essentially, nothing.
5. Invest in government bonds. Bonds are interest certificates issued by government agencies, like the Treasury, which offers no risk of default. The government controls the printing presses and can print whatever money is required to cover the principal, so these are relatively safe investments and a good way to diversify your investments.
   • Talk to a trustworthy broker and consider a bond-buying plan over to diversify your portfolio.

Maintaining Wealth

1. Consult good brokers for advice. Money is as good as the advice received. After accumulating a considerable amount of wealth, nobody wants to spend time huddled in front of a monitor watching stocks change by fractions of a percentage. You’re going to want to be out living life. Good, trustworthy financial advisors and brokers will work to keep your accounts swelling with excess funds.
2. Diversify portfolio and investments. Don’t keep money in one place. Diversify your portfolio and invest in stocks, real estate, mutual funds, bonds, and other investments recommended by brokers to modify risk. If a risky investment in ShamWow absorbent towels ends up tanking, at least you’ve still got a considerable amount of money in other ventures.
3. Make smart financial decisions. The Internet is full of penny stock schemes and get-rich-quick hokum that preys upon the ignorant and seduces gullible people into making bad financial decisions. Do the research and commit to a lifetime of investing and making money. There are very few exceptions to becoming an overnight billionaire.
   • When in doubt, be conservative with investments. Diversifying money wisely, letting interest accrue and riding fluctuating markets will be a smart decision in the long run.
   • If anything seems too good to be true, be careful. Never act too fast and always analyze the situation.
4. Know when to get out. At a certain point, knowing when to pull out of an investment before it collapses from under you is essential. If you’ve surrounded yourself with smart brokers, listen to their advice, but also know when to listen to your gut.
   • If you see an opportunity to sell big and make a profit, do it. Profit is profit. If that stock ends up appreciating the next year, you’ve still made money that you can reinvest elsewhere.
5. Act the part. To be a billionaire, act like one. Mingle with moneyed and cultured people, pick up advice and knowledge from the experienced.
   • Cultivate interests in fine art, fine dining, and travel. Consider buying a yacht and other standard trappings of the wealthy that are unaffordable.
   • There’s a distinction between “old money” and “new money.” New money is a derogatory term for people who have gained wealth quickly and live ostentatiously, spending and living a lavish lifestyle. To hold onto wealth, learn from old money and ascend to the stratosphere.

7 Dos and Don’ts for Becoming a Billionaire

Do: Invent

Inventing is a tough career path to take. But if you’ve got the smarts to successfully create, patent, produce and market a product that people need (and thus, will buy in droves), you can build your future billionaire life on it. Successful inventions aren’t necessarily complicated or high-tech items but can be improvements on existing items. For example, James Dyson invented a better vacuum cleaner, and Gianfranco Zaccai invented a better mop, the Swiffer.¹ ²

KEY TAKEAWAYS

• Billions can fall into two classes: those who invented something new, or those who do a previously invested thing better than anyone else.
• Being a billionaire takes an extreme work ethic and for many, quite a bit of patience.
• Billionaires are always learning and if you have the chance to ask them, they will almost always say they are the student, not the teacher.
• The most common traits among billionaires are work ethic and refusing to give up.

Do: Innovate

Innovation is the fine art of considering a current mainstream market and finding a creative way to improve the current offering.

Successful innovators will identify the real needs behind customer demands and will meet them with a smarter, better, more efficient product, or with a service that provides more than its competitors. Others may develop a business that works in a way just different enough to stand out from the rest. IKEA founder Ingvar Kamprad is a great example of someone who used innovation to yield billions.³ Furniture doesn’t seem like a very exciting market, but his approach of providing modular, economical pieces with a modern flair from Sweden and other European designers and manufacturers to a global market proved fruitful.

Do: Invest

Self-made billionaire Warren Buffett is famous for his frugal ways and for his smart investments. Investing, of course, requires a little seed money and some accurate insight into which investments are smart and which could result in a loss. If you can follow in the footsteps of billionaire investors like Buffett, then this might be the route for you.

Do: Be an Entrepreneur

The third option for becoming a billionaire is in the time-honored tradition of entrepreneurial pursuits. Starting a business and taking it to success isn’t always easy, but for those with good business sense and the ability to spot start-ups that have the potential to be great, entrepreneurship can be the vehicle to great wealth.

Billionaire entrepreneurs might work in one of two ways: either by coming up with a great idea and taking it all the way, as in the case of Bill Gates and Microsoft or by spotting someone else’s good idea and investing in it early on. Both are viable ways to reach the success that can get you billions of dollars when it comes to your own net worth.

Don’t: Think You Know It All

The moment you think you have nothing left to learn is the moment you kill your potential for becoming a billionaire. Especially if you’re interested in building your wealth through inventing or innovating, you have to be curious, open-minded and always learning. Those qualities allow you to look at old things in a new way, to see the potential for change and profit where others see only what already had been done.

Don’t: Make Flashy Investments

The latest and greatest investment opportunity may be fun to talk about, but one of the pitfalls of would-be billionaires is to jump in on the “next big thing,” which doesn’t always turn out to be so big. Investors who make billions from their investments avoid flashy, fun and high-risk picks and instead choose those with long-term potential to provide great returns. Real estate, energy, steel, telecommunications, pharmaceuticals, and energy are among the picks, while high-tech and intriguing but risky options may go either way.

Don’t: Quit Too Soon

Entrepreneurial types who succeed realize that success rarely comes overnight. One business idea might not pay off, but the next might. It’s not easy to build something from scratch, especially when your something is a fortune of billions. Time is on your side if you don’t rush it.

Conclusion

Becoming a billionaire is no easy task. But with the world’s economies growing every day, there are more billionaires being created than ever before. There are several paths you can take in order to become a billionaire, though not necessarily in that order.