7 Wealth-Building Lessons from Billionaires

There is no shortage of billionaires today. In 1985, there were fewer than 20 of them. Today, they number well over one thousand.

One of the best ways you can create and maintain wealth is by following the lead of people who’ve already done it.

About 33 percent of the very rich got their money through inheritance. The Waltons, for instance. The rest – two out of three – created their wealth through business. About half of those mega-entrepreneurs started with family money, and the other half started from scratch. These are the people – like Bill Gates, Warren Buffett, Sergey Brin, and Larry Page – who earned the wealth they have. These are the people I’d listen to if I wanted advice on how to succeed today.

I don’t know any of these billionaire entrepreneurs (BEs) personally, but I’ve done a lot of reading about them. I figured you might want to know what makes them tick and how they got where they are. Here is what I’ve discovered:

• Formal education matters – but not always. The great majority of BEs – about 90 percent – have a college degree. But it’s not necessary for success. Among the world’s super-rich today, Bill Gates, Fred DeLuca, David Geffen, and Andrei Melnichenko didn’t graduate from college. And David Murdock (Dole Foods), S. Truett Cathy (Chick-fil-A), and Richard Desmond (British publishing magnate) never finished high school.
• BEs work harder and longer than the people who work for them. Most say they work 50 to 55 hours a week. Some, like centibillionaire Canadian communication mogul Ted Rogers, work 12 hours a day. And some, like Bill Gates (when he worked at Microsoft) and eBay founder Jeff Skoll, took no vacations for years while their businesses were growing.
• BEs are constantly looking for profit opportunities. When they hear about an economic or business development, they think, “How could I profit from that?”
• BEs don’t dwell on mistakes. They view problems as learning opportunities. “I don’t remember any mistakes,” the late pharmaceutical billionaire James Sorenson told Forbes, “only the opportunity to overcome problems.”
• BEs think neither completely positively or negatively, but strategically. Instead of thinking, “That’s impossible” or “I can do anything,” they think, “Is that possible?” and “If it is, how could I do it?”
• BEs don’t believe in luck. In a Forbes poll of the 400 richest people in the world, none said they had become wealthy entirely by luck. Some said they considered luck to be a minor factor. Most, like Oprah Winfrey, consider luck an outsider’s way of describing someone who works hard and seizes opportunity. “Luck,” Winfrey says, “is preparation meeting a moment of opportunity.”
• BEs are not driven primarily by money. “Studies show that the desire for financial success is no stronger among entrepreneurs than among those not starting a company,” says entrepreneur expert Kelly Shaver. Wharton School management professor Raphael Amit agrees: “No one is saying they don’t like their wealth; but what matters more is the innovation, the intense commitment they have to an idea and the difference it can make. Money is a byproduct.”

If you want to survive and prosper in the 21st century, emulate the habits of the world’s richest people. Educate yourself about money. Make conservative investments. And seize opportunities to start and/or invest in entrepreneurial businesses.$

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The 3 Secrets of Self-Made Billionaire Investors

Warren Buffett was born in 1930 and became a child of the Great Depression. Today he’s worth in excess of $50 billion.

George Soros was born the same year, and became a child of the Great Depression, the Holocaust, and WWII. According to Forbes.com, he’s worth over $19 billion.

Carl Icahn was born in 1936. He was once so broke, he had to sell his car to feed himself. Forbes.com says he’s worth around $20 billion today.

All started with nothing. All wound up billionaires. All did it by investing.

At first glance, they don’t seem to have much in common… Buffett buys stocks and whole companies and says his favorite holding period for investments is “forever.” Soros became a billionaire by making huge leveraged trades in stocks and currencies. Icahn buys controlling stakes in public companies and badgers management to sell assets, buy back shares, and do anything it can to realize hidden value.

But they do have some traits in common, a few core investing ideas that helped make them billionaires. Like every great secret of life, this one is hiding in plain sight. These three self-made billionaire investors…

1. Don’t diversify
2. Avoid risk
3. Don’t care what anyone else thinks

No. 1: DON’T DIVERSIFY. CONCENTRATE.

Consider what is likely your greatest source of wealth generation: your career. You probably haven’t diversified at all in your career. Even if you tried many different careers, you were never doing several of them at once. And, even if you do more than one job, it’s highly likely you spend the great majority of your time at just one of them and that just one provides the great majority of your income.

Why should investing be any different?

For many years, Buffett had most of Berkshire Hathaway’s money in just four stocks: American Express, Coca-Cola, Wells Fargo, and Gillette. Today, most of Berkshire Hathaway’s money is still in just four stocks: Wells Fargo, Coca-Cola, IBM, and American Express.

No. 2: AVOID RISK

When Carl Icahn bought Tappan shares, he was paying around $7.50 each. But he knew by looking at the balance sheet that the company was clearly worth $20 per share if it were broken up. That’s a 62% discount to fair value, a very safe bet.

After Tappan, Icahn targeted a real estate investment trust called Baird and Warner. At the time he found it, the stock was trading for $7.89 a share. Its book value was $14 a share. That’s a 44% discount to book value, and a generous margin of safety.

Soros manages risk differently than Icahn and Buffett. He says the first thing he’s looking to do is survive, and he’s known to beat a hasty retreat when he’s wrong. He keeps loss potential in mind before trading. When he shorted $10 billion of British pounds in 1992, he first calculated that his worst-case loss scenario was about 4%.

No. 3: THINK FOR THEMSELVES

Wall Street wouldn’t buy shares of The Washington Post when Buffett started buying it in February 1973. That’s true, even though most Wall Street analysts acknowledged that this was a $400 million company selling for $80 million. They were too scared because the overall market had been falling for some time.

Soros talks to lots of people to get a feel for where a market is going. But he never talks about what he’s buying or selling. He just does it.

Carl Icahn doesn’t need Wall Street, because he has his own research team. Icahn’s people comb through thousands of listed companies to find the ones that are right for his corporate-raider style. Icahn has to have his own research team. If he bought research from Wall Street, the whole world would figure out what he was doing, and it would become difficult to buy shares cheaply.

Think for yourself, avoid risk, and don’t attempt to diversify into a bunch of investments you don’t understand.

If you really want to get rich in stocks, those three rules are your foundation.$

[Do you know how Facebook and Google became the most powerful companies in the world?

It’s NOT helping you share pics of last night’s dinner...
It’s NOT searching for drunken cat videos…

And it’s DEFINITELY NOT about free Gmail accounts.
 

The simple truth is Facebook and Google SELL TRAFFIC.

They SELL TRAFFIC to business owners, and that advertising revenue alone has turned them into billion dollar companies.
 

Traffic is the most valuable commodity on the internet, and that will never change.
 

This is why using the Traffic Authority business system is the ultimate way to make extra income in your business…
 

Click here to watch the video and start your own premium traffic business today!]