The Pursuit of Wealth is Heroic

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Back in 2004, when I began my Rich Habits Study in order to find out why the rich were rich and why the poor were poor, I’ll confess, I hated rich people. I had some entrenched negative beliefs about the wealthy that I inherited from my “poor” upbringing.

As I uncovered more and more about the causes of wealth and poverty, however, my hatred of rich people began to fade. When I finally completed my research in 2009, this hatred had transformed into admiration that bordered on idol worship.

The self-made rich, I learned, were nothing like the evil, greedy, materialistic horde I depicted as a child. In fact, almost everything I had been led to believe about the wealthy was a myth.

I thought I’d share some of those revelations with you and dispel the myths I embraced for much of my adult life. Let’s begin.

Myth #1: Rich People Inherited Their Money

“Old money”. That’s what I used to hear growing up. The rich were rich because of old money. Boy, is that a myth. In my study, 82% of the wealthy did not inherit anything. Nada, zip, zero. In fact, 76%, or 177 of the wealthy in my study, were self-made millionaires. 31% came from poor households and 45% came from middle class households. Only 24% of the rich in my study were raised in wealthy households.

Myth #2: Rich People Don’t Have to Work Hard

According to my Rich Habits study, one of the reasons the wealthy accumulated so much wealth was due to the fact that they worked more hours than those who were not rich. Here’s some of the data:

  • 44% of the wealthy worked 11 hours more each week than the poor.
  • 86% of the wealthy who had full time jobs, worked 50 hours or more each week, whereas 57% of the poor who had full-time jobs, worked less than 50 hours each week.
  • 88% of the wealthy took fewer sick days than the poor.
  • 79% of the wealthy, on top of their extended work hours, networked 5 or more hours each month. 55% of this networking was done during their lunch hour.
  • 65% of the wealthy were working so many hours, in part, because they had 3 sources of income to manage. 45% had 4 sources of income. Only 6% of the poor had more than one source of income.
  • 67% of the wealthy watched less than an hour of T.V. a day, whereas 77% of the poor watched more than an hour of T.V. a day.
  • 63% of the wealthy spent less than an hour a day on the Internet. 74% of the poor spent more than an hour a day on the Internet.

I initially thought this disparity in work hours, between the rich and the poor, was due to the fact that 91% of the wealthy in my study were decision makers, which carries with it more responsibility and, thus, more work hours. But that’s not the case. According to the Census Bureau, the average wealthy household (defined by the IRS as the top 20% of income earners in the U.S.) worked five times as many hours as the average poor household. The cause? Single-parent households and high unemployment among poor households.

Myth #3: Rich People Pay Less in Income Tax Than Everyone Else

According to the IRS, the income tax rate for the top 1% of earners in the U.S. is 22.83% whereas, the top 50% of income earners in the U.S. pay 14.33%. The bottom 50% of income earners in the U.S. pay just 3%. The top 1% of income earners in the U.S. pay 45.7% of the entire 100% of income tax collected by the IRS. 1% are carrying nearly 46% of the tax bucket for the other 99%. If anyone can make a case about the unfairness of our tax system, it’s the rich.

Myth #4: The Rich Are Rich Because They Just Got Lucky

Only 8% of the self-made millionaires in my study said they accumulated their wealth because of random good luck. 92% said random good luck had nothing at all to do with their wealth.

While this 92% acknowledged that luck was a factor in the accumulation of their wealth it was a different type of luck that they called “Opportunity Good Luck”. This is a unique type of luck that is the byproduct of their hard work, persistence and habits. This 92% never quit. They never gave up. Even when they failed, and 27% in my study failed at least once in business, they picked themselves up, figured out what went wrong and tried again.

Myth #5: The Rich Are Better Educated

While 68% of the rich in my study obtained a college degree, 110, or 69%, went to a public institution. 32% of the wealthy did not even obtain a college degree. And 36% of the self-made millionaires (57 of the 177 self-made millionaires) never obtained a college degree. Of those 158 of the wealthy who got a college degree, 73, or 46%, paid their own way through college and 23% of them went to college part-time, while they worked.

Myth #6: Rich People Are Not Charitable and Hate Poor People

I really struggled with this one because I believed from my upbringing that the wealthy were selfish and greedy with their money and despised poor people. Boy was I wrong.

62% of the wealthy in my study said they contributed 5-10% of their net income to charity. Many of the charities they supported included the community food bank, homeless shelters, means-based scholarship programs and organizations that benefited poor children.

But they didn’t stop there – 72% volunteered five hours or more a month for some charity. Their volunteer work included helping to run the charities, either through board membership, or as part of the various committees.

Myth #7: Money Does Not Buy Happiness

I must have heard my mom say this a thousand times growing up. I just assumed that rich people were miserable saps. Another erroneous belief. 82% of the wealthy in my study said they were happy. 94% of those who were happy, said they were happy because they liked or loved what they did for a living.

Myth #8: Rich People Live Extravagant Lifestyles

When I thought about the extravagant lifestyles of the wealthy I envisioned private jets, yachts, luxurious vacations, expensive cars, etc.

Wrong again. Fortunately, I gathered a great deal of data on the spending habits of the rich. Here’s some of that data:

  • 67% said they were frugal with their money.
  • 8% still shopped at goodwill stores.
  • 30% clipped coupons.
  • 92% never vacationed on a yacht.
  • 55% of the wealthy spent less than $6,000 a year on their vacations. Only 23% admitted to spending $10,000 or more on their annual vacations. Most of those 23% were those who inherited their wealth.
  • 87% said they never purchased a new luxury car in their lives.
  • 44% said they purchase a used car every five years.

It’s easy to hate the wealthy. Most in our country grew up poor or middle class and many of the poor and middle class were indoctrinated with beliefs that the wealthy were not good people.

Parents, the public school system and far too many politicians deride the wealthy, poisoning our children with depictions of the wealthy as corrupt, greedy and evil.

To remedy the “evils of wealth”, they advocate Socialist remedies, for the good of society – a legal confiscation of wealth through punitive taxation, which they perceive will level the playing field and reduce income inequality and the wealth gap.

Socialist Nonsense!

What kind of a message do you think this sends to America’s future generation?

It is teaching them that the pursuit of wealth and success is a bad thing.

The Occupy Wall Street movement was a manifestation of this cancerous Socialist, “hate the rich”, ideology.

The fact is, the rich are rich for a lot of reasons. And most of those reasons have to do with hard work, persistence, good habits, good decision making, frugal living, and building strong, powerful relationships with other success-minded, optimistic people.

We need to view self-made millionaires for who they are – individuals who took heroic risks in the pursuit of their dreams, AND SUCCEEDED!

The rich should be honored and not reviled. We should be teaching future generations to model them, not despise them.

The pursuit of wealth is heroic, because those who pursue it, are heroic.

My mission is to share my unique research in order to help others realize their dreams and achieve their goals. If you find value in these articles, please share them with your inner circle and encourage them to Subscribe. Thank You!

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Thomas C. Corley About Thomas C. Corley

Tom Corley is a bestselling author, speaker, and media contributor for Business Insider, CNBC and a few other national media outlets.

His Rich Habits research has been read, viewed or heard by over 50 million people in 25 countries around the world.

Besides being an author, Tom is also a CPA, CFP, holds a master’s degree in taxation and is President of Cerefice and Company, a CPA firm in New Jersey.
 
Phone Number: 732-382-3800 Ext. 103.
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Comments

  1. Tom,
    WOW! Very enlightening

  2. NfBobby sahye says:

    Dear Thomas,
    Greetings from London.Hope you are well.I am a big fan of yours and your story is very inspiring.Being a broke person and being a former nurse with no financial knowledge ,I used to have negative beliefs about the rich people.I have educated myself financially over the years and I am no longer a broke nurse,I am a full time investor in real estate and vanguard index funds.I love rich people and the immense contributions they make in our society ,not only in terms of job creation but innovation, charitable contributions ,all kinds of taxes contributions,fighting inequality,funding in fighting poverty and diseases ,food programmes,universities donations .The list is just endless.Rich people are a role model for anyone ,who wants to be successful in life.From my perspective,I learn a lot from the wealthy people and their successful habits.Rich people are not wasteful,they resourceful and they should be admired by everyone.

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