Lately, I have been thinking whether someone can become a millionaire if he follows a template. A template that is advertised in hundreds of articles and YouTube videos. Many books have been written on this topic as well. All of them ‘promise’ to make you a ‘millionaire’. But I guess the million-dollar question (no pun intended) is whether they actually work or not.
The recipe for becoming a millionaire has many ingredients. Like being at the right place at the right time with the right skill set. Persistence and hard work are also quoted as necessary. These ingredients are either purely based on luck or need a massive amount of willpower to pursue.
For me, however, the most important ingredient to the ‘Becoming a Millionaire’ recipe is ‘Risk Appetite’ which almost no one talks about.
Most of the existing millionaires who promise that they started their business from zero are mostly lying. They didn’t start from zero. They had good support from their family. And did not face the risk of famine or losing shelter if their idea didn’t materialize. Their risk appetite, in other words, was pretty high.
The few who did start from zero were already on the streets. Things were so bad for them that they could only go up. The ingredients of hard work, being at the right place at the right time with the right skills, being persistent, etc all worked for them. They had nothing to lose. But even for these rags-to-riches cases, the success rate is not very cherishable. Millions (again no pun intended) worldwide, fell through the cracks. Things just didn’t work out for them and they stayed in rags and way below the poverty line.
The problem comes for the majority of people (like me) who fall in the middle class of society. They neither have the cushion to protect their fall nor are hardened by a very tough life. They are used to comfort and a bit of luxury. People belonging to the middle class know that if they lose a few paychecks they are probably going to land on hard ground. Their families cannot support them forever. All they can do is enter a cycle of school > college > university > job/small business > marriage > kids > retirement. And then their kids start the same cycle. In the first half of the cycle i.e. school > college > university, the kids are helped by their parents, and in the post-retirement phase, the parents are helped by the kids. Or, the parents, if they had a long and prosperous career and were a bit wise with their spending and savings would have developed a safety net which includes a home and some savings to take them through the final days of their life.
This cycle is so constrained that hardly anyone can break out of it. Thus any amount of ‘self-help’ or ‘motivation’ to become a millionaire cannot break this cycle. Each generation of a family has to have long and prosperous careers for at least 3 generations to break the middle-class barriers and enter into the elite class. The class where safety cushions are available for their children to take risks and work on their ideas. But before the barrier can be broken if a family loses a skilled bread earner, they would face the potential risk of going below the poverty line.
So it is not the lack of persistence, hard work, ideas, skills, etc that prevent us from entering the millionaire club. It is rather our risk appetite, which is very low, that prevents us from breaking into the millionaire club. Maybe in a more people-friendly government that protects the middle class through free education for kids, affordable housing, health care, etc more and more middle-class families can take the risk, but I don’t see that happening any time soon.
So my life has entered a phase, where content promising me ‘millions’, does not hold any attraction anymore. I do not find myself participating in the race of ‘Who Wants To Be A Millionaire’. The formula for me is to develop gratitude for all that Allah has given to me, work hard, develop enough skills, and balance my income & expenses to have enough savings. I am not complaining. Alhamdulillah the formula has worked well for me and has given me more than I deserved and it would be something that I would be teaching my kids.