How to
Become a Billionaire –
7 Characteristics of the Rich & Wealthy
By Michael
Lewis
In 1916, John D.
Rockefeller, the father of the petroleum industry, became the world’s first
billionaire. Nearly a century later in 2015, there were 536 American
billionaires of a total 1,826 billionaires worldwide, according to Forbes. That number may in fact be low – the Wealth-X
and UBS Billionaire Census estimates there were 2,325
billionaires globally in 2014, including 609 Americans.
Identifying those who are
billionaires from those who have significant wealth can be difficult, since
many are reticent about publicly discussing details of their wealth. Also, for
many, growing personal wealth is not a goal, but the byproduct of their
business activities. In his book “Trump: The Art of the Deal,” Donald Trump, the
real estate mogul ranked at number 405 on the Forbes
2015 list, explains that money was never a big motivation for him,
except as a way to keep score. “The real excitement is playing the game,” he
states.
According to the U.S. Census Bureau, in 1916, Rockefeller was
the only billionaire of the approximately 102 million people in the United
States. Today, there are 320 million people in America with a billionaire for
every 600,000 residents. Assuming that the number of U.S. billionaires will
continue to increase at its historic rate of 6.49% annually, there will be more
than 4,800 American billionaires by 2050, or one billionaire for every 91,000
people of the projected 439 million total U.S. population. Dreams of becoming a
billionaire may not be as far-fetched as once believed.
What Is
a Billionaire?
Simply stated, a billionaire is a
person who has a net worth of $1 billion or more. In other words, if you can
sell all of your assets for cash, pay off your debts, and have $1 billion
remaining in the bank afterward, you are a billionaire. Having $1 billion in
assets with debts of $900 million doesn’t make you a billionaire, although you
and your family are unlikely to worry about future college expenses or
retirement.
A billion dollars, like all large
numbers, can be difficult to comprehend. For example, counting to $1 billion at
the rate of a one dollar bill per second would be a lifetime career for three
men working a standard 40-hour work week. If you hired them at age 21, they
would complete the task more than 44 years later, assuming they worked eight
hours every day without taking a single sick day. The counted $1 bills would
fill a building the size of a football field to a height of 8.3 feet and weigh
more than 1,100 tons.
In terms of purchasing power, a
billion dollars is the equivalent of the following:
·
1.53 million annual
passes to any of the Disney
theme parks, or a pass for every man, woman, and child living in
Philadelphia, Pennsylvania.
·
21,900 Cadillac CTS
luxury sedans so you could drive a different luxury car every day for 60 years.
If you are the frugal type, you and your spouse could each purchase a new Honda
Civic every day for the same period of time.
·
More than 95 million
Pizza Hut hand-tossed large pizzas or 167 million Big Mac meals, complete with
french fries and a soda.
·
More than 2,000,000
rounds at Pebble Beach Golf Links in California, enough tee times to cover you
and 99 of your best friends to play every day for the next 55 years at this
iconic and very expensive golf resort.
·
50,000 fares for a
121-day around-the-world cruise on the Queen Elizabeth. In fact, a billion
dollars would enable you and 415 of your closest friends to live on the cruise
ship year-round, sailing from one exotic port of call to another, for the next
40 years if you desire.
While some billionaires, indulging in
their wealth, own yachts, drive exotic cars, fly in private jets, and reside in
multiple mansions around the world, others are surprising frugal. Warren
Buffett, third on the Forbes list, still lives in the same
house in Omaha, Nebraska that he purchased 50 years ago for a little over
$30,000. And David Green, founder and CEO of Hobby Lobby, eschews the use of a
private airplane, preferring to fly coach, according to a Forbes interview.
Common
Characteristics & Experiences of Billionaires
While billionaires are unique
individuals, a review of the Forbes list suggests many share common
experiences:
·
Achieving Billionaire Status Takes Time. The average Forbes billionaire is
63 years old, and more than 90% are over the age of 45. There are some notable
exceptions to the rule as younger people are joining the ranks, generally
because of products and services now possible through technological advances.
At ages 25 and 26, respectively, Evan Spiegel (number 1,250)and Bobby Murphy
(number 1,250) founded mobile app Snapchat and received offers up to $19
billion in February 2015, according to CNN. At age 31, Elizabeth Holmes (number 360)
founded Theranos, a blood testing company valued in 2014 at $9 billion. And
31-year-old Mark Zuckerberg (number 16) has a fortune estimated to be in excess
of $30 billion in Facebook stock.
·
Education Is Important, But Not Required. Almost two-thirds of the
billionaires listed by Forbes are college graduates, the largest percentage
having degrees in engineering followed by business. Of the top 400 billionaires
in the United States, 29 have masters degrees and 21 have a PhD.
Unsurprisingly, according to Business Insider, Ivy League schools represent
four of the top five schools with billionaire alumni. More surprisingly, more
than 30% of the wealthiest people on the Forbes list have no college degree
including Bill Gates (Microsoft, number one on the list) and Zuckerberg (both
Harvard University dropouts). Michael Dell (Dell Inc., University of Texas at
Austin), Steve Jobs (Apple, Reed College), and Larry Ellison (Oracle
Corporation, University of Chicago) also failed to graduate from college.
·
Family Money Helps, But Is Not Critical. 60% made their wealth themselves,
including Gates, Buffett, and Ellison, whose families were middle-class. About
one-quarter inherited family money and went on to create super fortunes. Among
them are Carlos Slim Helu, also known as “the Warren Buffet of Mexico” (number
two), the Koch brothers (number six), Mars family members (number 22), and
Abigail Johnson of Fidelity Investments (number 85). About 15% are billionaires
from their inheritances alone (Sam Walton’s legacy accounts for number six on
the Forbes list: Christy, Alice, Jim, and Robson Walton, with Nancy Walton
Lurie and Ann Walton Kroenke).
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