10 Reasons You’re Not A Millionaire

future millionaire

There seems to be an impression that the only reason that people aren’t able to become millionaires is because they don’t work hard enough. The truth is that hard work has very little to do with becoming a millionaire. That’s not to say that you don’t have to work hard. You do. But you also need to avoid the many pitfalls and bad financial decisions which end up being the real cause that most people aren’t able to build wealth. The truth is that you don’t have to have a huge salary to gain assets in excess of a million dollars, but you do have to make good financial decisions (and avoid making bad ones).

It’s important to note that a single issue is likely not what’s keeping you from millionaire status, but a combination of several of the actions and decisions you’ve made. And, yes, there are exceptions to the rules, but then there are also people who win the lottery — and would you really bet your retirement on winning the lottery? Here are 10 reason that could very well be a contributing cause of why you’re not currently a millionaire:

You Spend More Than You Make

There are no secrets, and there certainly is nothing magical, when it comes to the basics of personal finance. In order to keep your finances in order, you need to spend less than you earn. If you fail to do this one simple thing, it doesn’t matter how much money you make, you’ll always find that you don’t have enough money to make ends meet. It also goes a step further than this. Spending less than you earn is not enough it itself to build wealth. You have to also actively save and invest a portion of all the money that you make. Most people recommend this amount to be 20% of your income. If you aren’t putting aside 20% of every paycheck you receive and placing it into long-term savings and investments, chances are you aren’t going to become a millionaire.

You Try To Meet Other’s Expectations

There is nothing which will keep you from reaching your financial goals faster than trying to live up to other people’s expectations instead of your own. This is more commonly known as trying to “keep up with the Joneses.” The simple fact is that if you’re trying to live like a millionaire before you have the resources of an actual millionaire, it’s not likely that you’re ever going to become a millionaire. Instead, you will simply be building up a lot of debt and wasting money on things to impress people who probably won’t be impressed anyway. Trying to keep up with the Joneses when your salary can’t compete with the Joneses is a sure way to sabotage the chance of building wealth.

You Don’t Pay Yourself First

One of the most fundamental steps that you can take to ensure that you put away money for yourself is to pay yourself before you pay anybody else. If your goal is to save 20% of your income, you need pay yourself that 20% from your paycheck before you pay any other bills or expenses that you may have. If you try to pay yourself after you pay all your other expenses, you’ll inevitably fall short at the end of the month from time to time (if not always), and fail to save as much as you had hoped. By paying yourself first, you make the commitment that wealth creation is an important part of your overall plan, and not something that hopefully gets accomplished after everything else.

You Have Kids

This probably isn’t going to be the most popular item on the list of why you’re not a millionaire, but the hard, cold truth is that children are expensive. Very expensive. The costs associated with kids can be mitigated to some degree if you have already built some wealth and have planned the cost of having children into your budget, but that often isn’t the case for many couples. Having children when you are young with a limited income will greatly affect your ability to build wealth. With compound interest being so important to wealth creation, and a cornerstone of it being that the sooner you begin saving and investing, the better, the fact is that it’s nearly impossible to put money aside when you’re young with children. When this is the case, all the extra money you have inevitably ends up going toward the children’s care instead of being invested for wealth creation.

Your House Is Too Big

Some people assume that purchasing a big house is a good investment. While this can be the case, purchasing more house than you can afford is a good way to make sure that you’re unable to create real wealth. The problem is that when you buy big, your expenses for the house are also bigger. A large house will mean bigger tax payments, more expensive upkeep, more stuff purchased to fill the house, higher insurance payments and all around more expenses than if you purchased a house that actually fits your needs. The real way to build wealth is to purchase a house that fits your needs and budget, and take all the savings that you gain from not buying the large house to invest and create wealth.

You Replace Things Too Soon

Just because there is a newer and shinier version of the gadget that you purchased a year or two ago doesn’t mean that you need to buy that new gadget. If you’re the type of person who is constantly replacing products that still have a useful life in order to buy the supposedly latest and greatest gadgets, chances are that you’ll have a difficult time building the type of wealth that you want. Those who create savings to invest do so by getting great value out of what they buy by using their purchases for the entirety of the items’ useful life. People who are able to afford the newest and shiniest things by upgrading every year are those who have already built their wealth, not those that are currently trying to.

You Let Others Take Charge Of Your Finances

There is nothing wrong with getting the opinions of others to help you lay out a plan to build your wealth, but it’s important to be an active participant in this planning. Giving full control to somebody else to handle your money is a sure way to make sure that you fail to build the wealth that you hope to create. Creating wealth and keeping it means that it’s necessary for you to understand the financial decisions which are being made, and periodically reevaluating them to make sure that they are meeting the goals that you have set. Giving full control of your finances to somebody else creates a situation where you’re no longer in control of your financial future, and the only one who you can truly trust to be looking out for your best financial interests is yourself.

You Fail To Take Care Of Your Health

There is nothing which will drain your wealth more quickly than getting sick. While you may not be able to control all aspects of your health, there are certainly steps that you can take to make sure that you’re as healthy as you can possibly be. Eating right, getting exercise, taking preventative measures, getting annual check-ups and taking care of medical problems before they become truly serious all put you in a position to live a healthier life. The better you take care of her health, the better the chance that you will be able to create wealth, and keep that wealth as you age.

You Get A Divorce

Just as getting married can be a wonderful way to help build wealth, getting a divorce usually has the exact opposite effect. In fact, getting a divorce is one of the best ways to destroy the wealth that you have built up to that point. That’s not to say that you should stay in a marriage solely for financial reasons, but it’s important to know that divorce is usually a giant wealth destroyer, and getting a divorce will hamper the best laid plans to become a millionaire.

You Have One Or More Bad Habits

A bad habit is anything that takes money away from you without giving more in return. The classics are smoking, gambling and drinking alcohol, but a bad habit could just as easily be that daily expensive cup of coffee or the three sodas that you drink each day. It doesn’t even have to be buying things. Being lazy and sitting in front of the TV five hours a day instead of working on making yourself better is also a bad habit that hurts wealth creation. Depending on the number of bad habits you have, and how much they cost you on an ongoing basis, these alone could be keeping you from becoming a millionaire.

(Photo courtesy of Enkhtuvshin)

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27 Responses to 10 Reasons You’re Not A Millionaire

  1. Erin990 says:

    Divorce killed my finances. Being a wife that earned more than my ex husband, I not only lost half of what I had, but continue to have to pay alimony to him. It was the right move (he was crazy), but it wrecked my finances and I’m still trying to recover.

  2. wanda says:

    Kids is a huge one. I love my kids as much as any mother, but I sure wish I had them when I was a little older, more mature and had a well established job.

  3. Christian Mom says:

    Children are God’s gift and never a thing that holds you back in any way! You should never blame children for financial issues because God wouldn’t have given them to you if you were only worried about money. You can’t even compare the two!!!!

  4. richard@moneygraffiti.com says:

    Heck, I can add at least 10 of my own:

    1. I’m always broke.
    2. I never have enough money.
    3. My expenses exceed my income.
    4. I always buy high and sell low.
    5. (Plus, I buy the wrong stocks to begin with.)
    6. I lend money that’s never repaid.
    7. I have champagne tastes and a tap-water budget.
    8. My taxes keep going up.
    9. My income keeps going down.
    10. My money is spent before I receive it.

  5. dave says:

    Are you serious?

  6. dave says:

    You forgot spending your free time writing stuff on money 😉

  7. Terry says:

    Do you believe a person earning minimum wage can become a millionaire? What is the minimum income that would make it feasible for a person to become a millionaire?

  8. jeffrey says:

    No, but I would expect for someone to not be earning a minimum wage their entire life. I’m also a big advocate of having multiple income sources so that you’re never reliant on a single source of income (those are part of the next article — 10 More Reasons…)

  9. jim says:


    Best thing you can do is let it all go – all of it. Then just start taking care of YOURself. Good luck!

  10. jim says:

    No – you really don’t wish you had them when you were older. When you do that (and we had one when we were in our 20’s and another when we were in our 30’s) – you’re putting your youngest thru college/grad school when you really need to be seriously saving for your retirement and paying that mortgage off. Count your blessings.

  11. wanda says:

    Actually, since I had them at 17 and 19, I think that, yes, I do still wish it.

  12. wanda says:

    I never blamed them for my financial issues. I just said that I wished I was a bit more mature when had them and I take offense that you would try to project your religious morality on me. Maybe you need to look in the mirror and hold yourself a bit more accountable on how you treat others.

  13. Christian Mom says:

    With an attitude like that, you’re going to Hell. Your disregard for God’s gifts to you won’t be judged lightly. You need to express more humility toward Him.

  14. Leumas says:

    Your’e a sad excuse for a reasoning, rational person. Believe in Easter Bunny and Santa Claus too?

  15. Alexandria says:

    Yeah, I wish I had my kids as a teenager – I’d be so much better off financially. Um, NOT!

    Actually, reread second paragraph: “It’s important to note that a single issue is likely not what’s keeping you from millionaire status, but a combination of several of the actions and decisions you’ve made.”

    I don’t believe there is anything inherent about “having kids” that would keep one from being a millionaire.

  16. wanda says:

    I don’t even know how to respond to this. I would suggest that you stop trying to force your religious beliefs on others and spend more time worry about your own faults.

  17. Ha ha, I think you were right about children being your hot button item. I love my children, but it would have been better for them if I had waited 5 more years to have them. Early twenties vs late twenties can mean a lot of money when you factor in compounding interest. It could have meant more opportunities with the increased money. Better college, better public school, better tutoring services. People that have children with no thought of how to take care of them are the ones being selfish.

    If you are worried about paying for their school by the time you are getting geared up for retirement savings, then you didn’t save for their schooling properly before hand.

    If you are making minimum wage, then you should quit your job. Start any low budget business (home cleaning, dog walking, babysitting, lawn mowing, snow removal) these take about 5 seconds to get started and if you start hustling you can make more then you were by the end of the week.

  18. gregory says:

    Or maybe I don’t want to be a millionaire 😉

  19. Minny says:

    Entering the child debate – with bated breath!! One reason children make people poorer here in the UK is the insanity that is buying stuff for them that has happened here in the UK.

    Mine are mid 30s, had second hand equipment, second hand clothes and toys. There was enough room in their bedrooms to store the toys they had, no television in their rooms and they ate what everyone else did at mealtimes. Now the opposite is the norm, no matter what the income.

  20. Minny says:

    See you there!

  21. Gailete says:

    Along with Erin, I agree so much with divorce. If only we had known these guys were crazy in the first place. Thankfully I didn’t have to pay alimony, but I did have to fork over child support until I fired my lawyer and took my ex to court on my own and got the custody settled a better way.

    Also, coming down with a chronic health problem that put me on disability at the peek of my earning years hasn’t helped.

    While we are not yet at the point of saving 20% of our income, In the last two years, I have actually been able to save some money which is better than what we were doing before. Still I use several on line ways to make money which greatly helps our financial bottom line. Currently I’m looking forward to getting my next AdSense check next month which will go into my Roth IRA.

    I guess I don’t expect to become a millionaire, but without some of those speed bumps, of ex’s and bad health, I would have been well on my way to it. Instead I’m trying to get our finances as high as possible before we can no longer work.

  22. Retired Syd says:

    I retired at 44 and agree that all of the things you mentioned play a role in being able to save enough to achieve that goal. Despite the tiff above over the impact of children, it’s pretty obvious they cost money–just like all the other things you mention. We never wanted kids, which gave us an obvious advantage when it came to saving money. Having said that, the cost of children never entered my mind when deciding not to have them. It’s simple either you want them or you don’t. And before someone jumps on me for defying God or something–that’s why God gave you a brain in your head, so you could make your own decisions.

  23. Josh says:

    You sound just like me. I must be a millionare. No less. But I will like to find a girl who understands frugality and doesnt want kids

  24. queala (also a christian) says:

    Amen, Wanda! Some things turn out better when they’re planned for better – which takes maturity in most cases. Christian mom is judging – which is why christians get a bad rep…jus sayin’

  25. Jason says:

    The words i live by are do i want it or do i need it?

    It is all about finanial management, working very hard and getting up the career ladder, have good educational creditenials or experience and saving and investing.

    All a average person needs is a good paying job to begin with, maybe $40k as a start. Work a couple years, save as much as your disposable income, run an average car, eat well, be the one that is the most skilled at what they do. Education helps with getting the higher paid senior positions. Property and investments is where most money is made, whether you earn 40k or 150k. Appreciation in assets and return on investments act as a second income.

    Obviously,being an actor, some sort of celebrity or lottery winner is the fastest way but that is very unlikely to happen.

    One of the easiest ways is start your own successful business. In the 21st century, this is the hardest route but the most rewarding if it works. Or through criminal avenues but i don’t recommend them if you want to stay alive.

    My last tips are not to buy junk and crap you don’t need or can’t afford. Stay away from high interest credit cards and borrowing and live within your means even if it sucks and life is not fun.

  26. di says:

    Learn to live without.

  27. di says:

    Albert Einstein: Simplicity is the ultimate sophistication.

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