Search Results for: relationship-building

Self-made millionaires are very particular about who they associate with. Their goal is to develop relationships with other success-minded individuals. Some of the individual characteristics self-made millionaires seek include:

• Individuals who are successful or success-minded.
• Individuals with good habits.
• Individuals who are positive, upbeat and optimistic.
• Individuals who are calm and happy.
• Individuals who are able to get along with others.
• Individuals who do not gossip about others.
• Individuals who inspire and motivate.
• Individuals who are enthusiastic.
• Individuals who take personal responsibility for their lives.

At the same time, self-made millionaires also make an effort to eliminate toxic relationships. Toxic relationships have some of the following individual characteristics:

• Individuals who are always experiencing some type of turmoil.
• Individuals with bad habits.
• Individuals who are negative, perpetually depressed, unhappy or pessimistic.
• Individuals who are constantly putting out fires.
• Individuals who are perpetually fighting with someone.
• Individuals who gossip.
• Individuals who are dream killers.
• Individuals who lack enthusiasm.
• Individuals with a victim mindset.
• Individuals who blame others for their problems.

Self-made millionaires use four relationship building strategies to grow and strengthen their relationships:

1. Hello Call – The Hello Call is used primarily to gather information on each contact.
2. Happy Birthday Call – The Happy Birthday Call keeps your relationships on life support. At least once a year you are forced to reach out to your contacts to wish them a happy birthday. About 5-10% of these contacts will reciprocate and call you on your birthday, taking your relationship off life support.
3. Life Event Call – The Life Event Call is the most powerful strategy because it puts your relationships on steroids. This is a call you make to acknowledge some life event: birth, death, engagement, marriage, health issue, etc. Life Event Calls put your relationships on steroids. They grow the roots to the relationship tree deeper and faster than any other relationship-building strategy.
4. Networking/Volunteering – Networking & Volunteering allows you to meet new people and offers the opportunity to showcase your skills in a safe, friendly and stress-free environment. Developing a networking process is critical to success. When you network the right way, you gain customers, clients, strategic business partners, followers and networking partners and this translates into more money. Self-made millionaires are master networkers. Their networking efforts are intended to grow their association with other successful individuals. There are a number of ways these millionaires go about networking:

• They join networking groups/clubs. BNI International is the most popular, but many self-made millionaires often organized their own unique networking groups.
• They joined advisory boards of community businesses.
• They joined local civic groups such as the Lions Club, Rotary Club, Chambers of Commerce, Knights of Columbus, Optimist Club or local business groups.
• They did speaking engagements. Speaking engagements are probably the most efficient networking tool available. One speaking engagement can mean thirty or more potential clients/customers or new relationships. Many individuals fear public speaking. One of the common traits among these millionaires is their ability to overcome their fears. Public speaking sets you apart from the masses. It is a competitive advantage.
• They join non-profit groups and eventually get on the board or run one or more committees. Non-profit groups are a very valuable resource for referrals. It allows you an opportunity to showcase your skills and develop long-lasting relationships. Referrals come from every direction; fellow members, vendors, donors and beneficiaries of the organization. Most board members on non-profits are very successful, wealthy individuals who have strong, powerful relationships. Joining a non-profit grants you access to this treasure trove of valuable relationships of the other volunteers.

When self-made millionaires find someone special, they devote an enormous amount of their time and energy into building a strong relationship with them. Their goal is to grow each new relationship from a sapling into a redwood. They used the Law of Reciprocity to very rapidly turn their new relationships into redwoods.

Here’s how this law works: each day you dedicate a portion of your day to improving the life of just one of your valued relationships. Spend time each day helping your relationship achieve their goals, improve their careers or grow their business. Fifteen to thirty minutes a day is all it takes. Eventually these valued relationships will become your biggest cheerleaders, best salespeople and best referral source. This strategy also opens doors to new contacts.

I would be doing my readers a disservice if I didn’t acknowledge the importance of luck in the creation of wealth. Luck, I’ve learned from my research, is a common denominator among certain millionaires. Without it they would have never become wealthy.

There are essentially six types of millionaires:

1. Savers – Savers accumulated their wealth by living below their means, saving money and then investing that money prudently.
2. Executives – These millionaires started out working for large publicly held corporations. Through hard work, smart office politics, constant self-improvement and powerful relationship-building skills, they rose up the ladder in their respective companies. As executives, they received higher than normal compensation, which always included bonuses and stock compensation.
3. Entrepreneurs – These millionaires are individuals who pursued a dream, started their own business, overcame obstacles, faced adversity and through superhuman persistence, succeeded. 
4. Virtuoso’s – These millionaires devote their lives to acquiring knowledge and building unique skills. After many years of focus and devotion to their careers or craft, they become virtuoso’s at what they do.  And others are more than happy to pay them a premium for their services or the products they sell.  
5. Trust Fund Babies – These are individuals who are born into wealth and inherit most of their money.
6. Gamblers – These are individuals who gamble regularly and get lucky by winning the lottery or the slots or something along those lines.

For Entrepreneurs, Trust Fund Babies and Gamblers, luck plays a major factor in becoming wealthy.  The difference for Entrepreneurs and Executives is that they create their own luck. Through hard work, constant self-improvement, persistence and taking calculated risks, Entrepreneurs and Executives create the opportunity for luck to occur. They are the beneficiaries of Opportunity Luck, whereas Trust Fund Babies and Gamblers are the beneficiaries of Random Good Luck – two very different types of luck.

Luck is not a factor for the Savers and the Virtuoso’s. So, for those who do not want to depend on luck, your best option is to become a Saver or a Virtuoso.

In my study, I discovered three types of self-made millionaires:

1. Savers
2. Entrepreneurs and
3. Executives

This topic will focus on the Executives.

Executives are ordinary individuals who decide to spend their lives working for big, publicly-held companies. These companies offer additional compensation in the form of stock: qualified stock options, non-qulified stock options, discounted stock purchase arrangements, stock grants and restricted stock.

Employed, self-made millionaires use specific strategies that make them un-fireable:

• They become in-house experts within their company.
• They become industry experts within their industry.
• They develop a niche within their company or their industry.
• They forge power relationships with other influencers within their company.
• They forge power relationships with other influencers within their industry.
• They use four core relationship-building strategies: Hello Calls, Happy Birthday Calls, Life Event Calls and Networking/Volunteering.

There are many ways to become rich. Climbing the corporate ladder in a large publicly-held company is one of the less risky paths to accumulating wealth.

In my five-year Rich Habits Study, I interviewed 177 self-made millionaires. I am often asked by the media how they got rich.

Essentially, my self-made millionaires fell into three distinct groups:

The Savers

The first group of self-made millionaires in my study saved their way to wealth. These Savers accumulated their wealth by living below their means, saving money and then investing that money prudently. According to my Rich Habits research, this path to multi-millionaire status took about thirty-two years.

Savers typically were risk averse, employed most of their lives, earned a moderate wage and had a low or moderate standard of living.

Self-made millionaire Savers were among the least wealthy in my study, with an average net worth of $3.4 million.

Being a Saver is the risk-averse way to building wealth. It’s the safe path to wealth accumulation. However, it required discipline, sacrifice and attention to detail in order to live below their means, save and prudently invest.

The Executives

The second group of self-made millionaires in my study worked for large publicly held corporations. Through hard work, smart office politics, constant self-improvement and powerful relationship-building skills, they rose up the ladder in their respective companies.

As executives, they received higher than normal compensation, which always included bonuses and stock compensation.

This stock compensation was in the form of one or more of the following:

• Qualified stock options
• Non-qualified stock options
• Stock rights
• Restricted stock
• Outright stock grants

The stock compensation, irrespective of its form, was always disproportionate to their base compensation, meaning, significantly higher than their base pay. This stock compensation was responsible for generating most of their wealth.

It took this group about twenty-five years to accumulate their wealth.

The Entrepreneurs

The third group of self-made millionaires in my study were the entrepreneurs – individuals who started their own business. This group, by far, accumulated the most wealth, averaging $7.4 million over an average of twelve years.

This was the highest risk and hardest path towards building wealth. In fact, 34% of the self-made millionaire entrepreneurs in my study failed at least once in business, which took a toll on their families and their lives.

The upfront investment in time and money was significant.

The early part of the journey for the typical entrepreneur was one fraught with nothing but uncertainty.

They invested most, if not all of their time, money and energy in something with no guarantee of success.

Despite their best efforts, things often went wrong. In the beginning, there was an endless parade of setbacks, obstacles and mistakes.

With every misstep, doubt was a constant companion. These doubts fill their waking moments and invaded their dreams.

Peace of mind was hard to find. Uncertainty sucked the life out of them. It often drained them of their confidence and every setback caused them to wonder if it was all worth it.

It took superhuman resilience to survive the entrepreneur’s journey.

But the journey transformed their lives and the lives of their families.

It forced them to develop new skills, acquire new knowledge and learn how to find and build relationships with other outstanding, success-minded people.

Those who were able to survive the journey and succeed, became millionaires and found happiness and fulfillment awaiting them on the other side of their journey.

There’s no easy path towards accumulating wealth and becoming a self-made millionaire.

Saving your way to wealth is the least stressful and least risky path towards accumulating wealth, but it requires enormous discipline and sacrifice.

Climbing the corporate ladder to wealth requires unique skill-sets and more than a little bit of luck. Finding a publicly held company to work for is easy. Finding one that is in a growing and expanding sector where profits and share price are consistently rising requires some luck.

Being an entrepreneur is perhaps the hardest way to accumulate wealth. The ups and downs, characteristic of entrepreneurship, requires enormous emotional control, long work hours, persistence, resilience, focus and the ability to rebound from mistakes and failure.

One of the strategies the wealthy use to build long-lasting, valuable relationships is the Life Event Call.

These calls are made to clients, customers, patients or any relationship you value and want to grow, in order to recognize a particular event that occurred in the contact’s life.

An example would be if a client or their spouse had a child. Make a call simply to congratulate them on the birth. Happiness emotions are running high and emotions, good or bad, hold the key to long-term potentiation (long-term memory formation).

When they get that call from you, it will stick in their memory banks and you will forever be associated with one of the happiest events of their lives.

Other examples of opportunities to make a Life Event Call are:

• Graduations
• Promotions
• New Job
• Death
• Illness
• Marriage
• New Home
• Relocation
• Any events in the lives of the children of your valuable relationships
• Awards
• Accomplishments

Life Event Calls put your relationships on steroids. They grow the roots to the relationship tree deeper and faster than any other relationship-building strategy.

My wife has a lot of friends. More friends than anyone else I know. I find it counterintuitive because she seems to demand a lot from her friends in the form of favors. But, she always reciprocates, meaning, it’s never one-sided. What amazes me the most is that my wife will ask someone she just met for a favor right out the gate and, of course, eventually reciprocate.  

These two habits my wife has forged have long intrigued me. I didn’t understand how or why they helped her in building strong relationships until I embarked on my obsessive study of daily habits many years ago. There are actually two psychological phenomenons at play, I discovered.

The Franklin Effect

The Franklin Effect is named after one of the most famous founding fathers in America –  Benjamin Franklin, who used it as a relationship-building tool. It has now become an accepted method for building strong relationships. Here’s how it works:

If you want to get someone to like you, either ask them for a small favor or perform a small favor for them. 

For some strange reason, human beings like doing small favors for each other. 

The Law of Reciprocity

The Law of Reciprocity states the following:

If you do a small favor for someone they will feel obligated to reciprocate.

The rich people in my Rich Habits study all seemed to have one thing in common – they had a lot of relationships. 88% had 200 or more relationships. Conversely, 95% of the poor people in my study had less than 200 relationships. When I dug deep into the reasons for this dichotomy, that’s when I discovered that the rich people in my study were using the Franklin Effect and the Law of Reciprocity for relationship building. As a result, these two tools became part of my arsenal of Rich Habits, which I obsessively write, talk about with the media and teach to millions around the world.

My wife, without knowing it, was employing both tools to build her enormous number of relationships. And many of the wealthy in my study, like my wife, were completely oblivious to their use of these two relationship-building tools. My wife had picked up these tools from her Dad and then turned them into lifelong habits. This is not uncommon. Most of the habits the wealthy had forged in life came from their parents as well.

Less than 5% are raised in families where parents teach their kids the Rich Habits. We are most definitely not all on equal footing when we step foot onto the adult stage. Those who have the Rich Habits have at their disposal certain habits or tools, like the Franklin Effect and the Law of Reciprocity, thanks mostly to their parents. This enables them to cut through their competition, like a hot knife through butter, accumulating millions of dollars along the way.