MindsetMoney Stories

A Millionaire Friend Shares the Secret to Wealth Creation

Money is a tool, and we must learn to use it. My millionaire friend prioritizes learning different ways to use money along with finding ways to make more of it—essentially, learning how to make money with money.

Everyone I know has wondered what it would be like to be a millionaire.

Some people believe it’s nearly impossible to become a millionaire without winning the lottery or making six figures. However, I’ve come to the realization that a million-dollar net worth is attainable.

I’ve spoken with enough people in different socio-economic conditions across the country and learned how possible it is to achieve this financial goal.

It gave me the confidence to believe I could attain such a feat even with my prior limiting money beliefs and financial troubles.

I wanted to learn more, and I did so by openly sharing and asking for money stories—the good and the bad, but mostly about how others can lift themselves up against all odds.

I was breaking the social taboo about money with strangers, family, and friends.

This led to frank and open discussions about their financial highs and stressful lows. One conversation, in particular, stands out. It was the first time a friend shared he was a secret millionaire.

He blurts out in the middle of a conversation, “I’ve been aggressive about making money and saving money.”

I responded with how awesome that was and asked for more details.

He then shared that he never felt comfortable telling others how much he makes or what he does with his money. He felt it was much easier for friends to say they were broke than to share how much they had.

“No one likes that guy who shows off with his money, ” he added.

My friend shared how he’s been saving money since he was 16. He was taught by his parents to save his cash. His parents immigrated to the US and struggled to live the American dream for years. They imparted frugality and determination to do better.

That means he saved his birthday and graduation gifts, as well as the cash he earned from mowing lawns and shoveling snow.

By the time he was 18, he had begun investing money after a conversation with his manager. His manager told him, “Don’t buy the car, buy the maker of that car.”

It was that conversation that led him to rethink how he used money.

In fact, he doesn’t think of money in terms of saving, investing, or spending. He purely thinks of it as a utility. “It’s a tool helping me build a fun life.”

That gave me pause.

To this day, I think about what it means to “build a fun life.”

My friend doesn’t measure his success or think about life in terms of cash in his accounts. But he does think about the tools and how much of it he needs to support the life he enjoys. This ensures he’s using his tools (money) to create, not distract him from truly living.

After another drink, he shared how he became a millionaire.

It was due to earning more from his first job, but he also used that salary to invest in his 401(k) and own stocks of the company that employed him (through his company’s stock purchase program).

By the time he was 26 years old, right around the Great Recession, he bought his first multi-family home as an investment. He would live in one apartment and rent out the second floor and finished attic.

In 2009, he became an accidental house hacker. He used rental income to pay for the mortgage, essentially living “for free,” but still used his income to pay off the mortgage faster.

This real estate investment strategy is known as house hacking.

When the housing market crashed, my friend had money saved and additional assets that enabled him to purchase his second multi-family home in the same neighborhood for a significantly lower price than his first house.

I must admit that my head began to hurt during this conversation.

Or maybe it was due to the multiple beers I had drunk.

The reality: It was a sudden realization that I had been asleep for way too long when it came to my finances. Back then, I was driving a $38,000 car with a large monthly payment and a $4,000 annual insurance premium.

The realization that I’ve been mindlessly spending and living hit me hard.

My friend became a millionaire before the age of 30. I was making a six-figure salary and didn’t have assets to show for it.

My millionaire friend prioritized using money to create a solid foundation for his life. I prioritized spending money to distract myself from the life I was actually living.

Today, I think of money as a tool to help me build deep, meaningful connections and memories. That also includes owning a home and a nice car, but all in the context of supporting my dream life. I’m not earning money to keep up with the Joneses.

I’m making money to build the life of my dreams, which includes less financial stress.

So why was my millionaire friend “lucky”?

He had a very good relationship with money and its practical uses. He was consistent and focused. My friend listened to people he believed were using money well and wanted to emulate them. He also started early.

Of course, taking advantage of the housing market supported his million-dollar status. But unlike many others during this time, he was financially prepared to use the downturn to grow his net worth.

Here is a list of traits I’ve noticed my friend and other millionaires have:

A healthy relationship with money

I’ve learned that wealthy people have a different relationship with money.

Money is a tool, and we must learn to use it. My millionaire friend prioritizes learning different ways to use money along with finding ways to make more of it—essentially, learning how to make money with money.

Credit as a tool

Those with money don’t necessarily avoid credit use.

In fact, they use credit (other people’s money) as leverage to own income-producing assets. They don’t use credit for basic living expenses or a night out with friends. Credit isn’t for emergencies either, but they don’t beat themselves up for using credit if a truly important need arises.

Credit, in fact, is a tool. My millionaire friend uses it to support his activities, not spend on them.

He advises, “Spend on what you can afford and be realistic because you probably can’t afford 90% of what you think you can.”

My take on this: learn everything about credit reports and scores. You can also use a credit monitoring app to help you.

Wealth doesn’t have to be flashy

My millionaire friend looks and acts just like the rest of us. Maybe he smiles more and seems to be at ease more often than most. When you have your finances in order and the systems in place to prevent unexpected situations, it’s easier to breathe deeper and be present more.

My friend owns 3 homes, has a car, and works at a job with a good salary and healthcare. He has a side business to earn extra cash, goes on vacation a few times a year, and splurges on good wine. My friend found a balance in enjoying his wealth today with a plan to support enjoyment in the future.

Learn more about the differences between rich and wealthy mindsets.

Becoming a millionaire friend

You’ve heard these money tips before: spend less, save more, invest money, build assets, don’t carry debt, and follow a plan.

But if you want THE secret to becoming a millionaire friend, keep this in mind: It requires a solid foundation that includes financial knowledge, access to resources, and community.

Want to read more stories? Get copies of my two bestselling books:

  • Happy Money Happy Life: a book that teaches you how to use money to buy happiness by spending on wellness.
  • You Only Live Once: a book that shifts your money mindset to one that empowers you to live your best life.

Jason Vitug

Jason Vitug is a bestselling author, entrepreneur, and founder of phroogal.com and thesmilelifestyle.com. His purpose to help others live their best lives through experiential and purposeful living. Jason is also a certified yoga teacher and breathwork specialist and has traveled to over 40 countries.

Related Articles

9 Comments

  1. Great article Jason! I think millionaires are more frugal than what we might have thought of them. It really is depressing to see more people spend more than they could.

    1. Thank you. Yes, I’ve found most millionaires are phroogal thinkers. Every purchase is calculated and money is to be invested to make more of it rather than spent. The real goal is to not have to be tied to a job that one hates but have the freedom to say I’m going to pursue something else.

  2. Reading this today mirrors the journey that we’ve made, we’re not millionaires yet but lead a great lifestyle, we invest every month, and don’t dread retirement, even though it’s a good few years away yet. It’s true to say that wealth creation is no secret it’s all out there in the web. Great article good luck for the future.

    1. Thank you. It’s an amazing journey to be in and I’m happy you don’t dread retirement. Continue to live life rich my friends!

  3. Interesting post but I am curious on how he actually amassed the million at such a young age? Was it investing, buying homes, did he end up with extra money, are we including a spouse’s income.

    1. This friend actually owned two homes once. He purchased his first home a 3 family unit. He lived on one of the floors and rented the other two. This was during the real estate upswing and made a size-able amount of cash when he sold during the height of the bubble.

      So instead of spending on things like I did and others like me he purchased his home when he was 20. Yea back then you had no doc loans. I didn’t go into detail of what he did but he invested in the stock market, bought a one family home at a really affordable price during the crash that has since gone up, invests max on 401K, IRAs, has stock options he executes at work.

  4. That is impressive and cool. I too bought my homes at 21 and 22. I do not plan on selling though. By the time i’m ready to retire, they should both be paid off. I’m glad I started early. I’m working on encouraging others to do the same.

    1. This is great. Many think it’s impossible but you’re showing it is possible. You’re growing your assets and you’ll get to the point your net worth will be in the millions.

  5. Will add a few that will have a huge effect on your path, to wealth.
    1 Marry the right person. A divorce can cost you fifty percent or more of your wealth.
    2. Get the proper education, so you can get a great high paying job.
    3. Diversify your investments.
    4. Be wary of the millions of people that are trying to scam you out of your investments, which includes most financial adviser’s.
    5. Auto’s are meant for transportation,
    avoid buying fancy vehicles to keep up with the Jones’s
    6. Avoid debt like the plague, you want the bank paying you interest vs.
    paying the bank interest.

Leave a Reply

Your email address will not be published. Required fields are marked *