The Millionaire Next Door

Why Are the Rich Rich and the Poor Poor?

“Why are some people poor and others rich?”
The answer to this question was the focus of a national survey of 1,504 adults conducted earlier by the Pew Research Center.  Only about 4 in 10 (38%) of the respondents indicated that the rich are rich “because he or she worked harder than others.”
But how do millionaires, the people who are actually wealthy, explain their own economic success?  Nearly 9 in 10 (88%) rate “hard work” as a very important/important factor.  [See for example Table 2-1, Millionaires’ Success Factors, The Millionaire Mind].

In the same Pew study, 51% of the respondents were of the opinion that the rich are rich “because he or she had more advantages than others,” while 50% indicated that the poor are poorer because of “circumstances beyond his or her control.”  Contrast these results with the fact that 80% of millionaires in this country are self made.  Also note that 95% of millionaires rated “being well disciplined” as a very important/important component in explaining their economic success.

The wide contrast in the beliefs of the general population as opposed to those of millionaires has many implications especially within the political arena.

Assuming that the Pew study was representative of the adult population in America only about 4-8% of the respondents were millionaires, if that many.  How valid therefore are the opinions of those surveyed in this study in explaining the variations in wealth accumulation in this country?  The typical American household has a net worth of just over $90,000 and an annual income of approximately $52,000.  What do these people really know about how to become rich?

If your objective is to become financially independent, you may find it more productive to follow the ways, means and lifestyles of America’s self made millionaires as opposed to those of the population in general.

6 thoughts on “Why Are the Rich Rich and the Poor Poor?”

  1. It’s interesting that poor people don’t think hard work brings money… I will always listen to the side of people who are where I want to be in life!

  2. Will L. (First Quarter Finance)

    I always try to remember that there are people out there in far worse situations making far more money than myself.

    #noexcuses lol but seriously

  3. “Why are the rich rich & the poor poor?” An author named Banfield wrote ‘The Unheavenly City’ and found the wealthy think long term…10-20 years out…The poor think no further than the current paycheck, if they get one at all…In Britain, they line up when a child is born and get the baby enrolled at their school of choice and are enabled to afford it in 18 years…also, I use the Law of 72 as a reminder on how significant compound interest is…Google it!

  4. Hard work and delayed gratification. I worked all through college for fun, I did not need to, and now years later with a fraction of the money I did not spend, Im taking flying lessons. Just because I want to.

  5. You got it wrong, Victoria. Poor people DO work hard! They work hard, but they are still broke. All the personal development experts say rich people DO NOT work hard! They become rich by doing what they love, putting out a product that solves a problem, and selling it to millions which causes them to become rich. You need to study and learn more about what causes people to be rich and what cause people to be poor.

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