

Ask HN: What do billionaires do different than millionaires? - sarisari

Besides getting much luckier, is there anything else that can be controlled?
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mtmail
This answer from two weeks ago was very enlightening on how billionaires think
of money

[http://www.reddit.com/r/AskReddit/comments/2s9u0s/what_do_in...](http://www.reddit.com/r/AskReddit/comments/2s9u0s/what_do_insanely_wealthy_people_buy_that_ordinary/cnnmca8)

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scholia
Billionaires have enough money that they probably don't have to worry about
money. Millionaires are mostly pretty ordinary people, except they own a house
and have a job and a pension fund. Many of them are "asset rich, cash poor":
they have to watch what they spend.

The average house price in London UK is $771,360, so lot of people own houses
worth more than $1 million. The median house price in New York is $548,500,
while "The median price paid in June for a new or existing single-family home
or condo in San Francisco hit $1 million for the first time, according to a
report released Wednesday by DataQuick."
[http://www.sfgate.com/business/networth/article/1-million-
ci...](http://www.sfgate.com/business/networth/article/1-million-city-S-F-
median-home-price-hits-7-5626591.php)

You can become a millionaire by working hard at something and investing
wisely, and a multi-millionaire if you're exceptionally good at your trade (or
lucky). Becoming a billionaire looks a lot trickier, but I suspect you're less
likely to do it while working for somebody else.

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brd
I'd say the most important thing to do is to decouple your income from your
time. You can easily become a millionaire with a reasonable paying job but to
become a billionaire requires that you find ways to massively scale your
income. There is an upper threshold on what you can make per hour and barring
the most successful CEOs, it is likely impossible for you to be a billionaire
by trading your time for money.

This is why finance is such a lucrative area. In finance you leverage money to
make money as opposed to using your time to make money, property has a similar
effect. Starting a company is another good option simply because you begin to
make money by trading other people's time.

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hashtag
Most people here, if not everyone, is probably unqualified to answer this
question. Any answers given are likely to be speculation and best guesses.
Take any answer you get with a grain of salt.

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bbcbasic
I would guess wealthy or powerful connections matter a lot. Ideally if they
are family, childhood friends etc.

I know that is a sucky answer but I am assuming you mean all billionaires not
just the completely self made ones.

Also for most people making a few million is enough to solve the money
problem. There may not be any further desire to get rich.

However if you do have that desire and it outweighs other psychological
constraints (avoiding fear, pain, change etc.) and that desire can last
decades then it is possible to get from well off to rich.

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JSeymourATL
Given the complexities and multiple models of wealth creation, I don't think a
qualified separating control factor exists. Fun to think about however.

BTW - Bloomberg News has an entire page dedicated to Billionaire stories>
[http://www.bloomberg.com/video/billionaires/?cmpid=billionai...](http://www.bloomberg.com/video/billionaires/?cmpid=billionaires728x90)

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xrange
On a side note, I met a couple today who decided to go to the super bowl, and
claimed that they were dropping $3k per ticket, not including air-fare and
hotel. They didn't want to have nose-bleed tickets, but they didn't need to be
front row with the VIPs. What kind of income do you generally suppose someone
would have to make to afford that kind of expenditure?

~~~
brd
I'd say its more about living within your means and having the motivation to
spend on what you decide matters. Although if they splurge on activities like
that on a regular basis it would be an entirely different story.

At 23, I was making sub 6 figures and bought a ~$3000 plane ticket at the last
minute to visit some friends around the Mediterranean.

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Someone1234
The market they're in.

Playing follow the leader is rarely a way to make a lot of money.

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brd
The first part is absolutely true, the second line sounds like something
directly from Peter Thiel.

While there's wisdom in his idea of finding green pastures and being a
pioneer, its actually not the best way to become a billionaire. Picking the
right industry is a far better strategy.

If you look, something like 25% of newly minted billionaires made it there via
investments (i.e. finance) while another large chunk got there via real
estate. Neither of which requires much in the way of being a trail blazer,
just hard work and competence.

~~~
dalke
3 of the top 10 billionaires are from the Walton family, so another good way
is to inherit it.

I say that to suggest that you have a strong bias error.

[http://selectusa.commerce.gov/industry-
snapshots/financial-s...](http://selectusa.commerce.gov/industry-
snapshots/financial-services-industry-united-states) says there are 5.87
million in the 'financial services and insurance sectors' in the US. There are
under 2,000 billionaires in the word, so at most 500 "newly minted"
billionaires who made it there via investments.

It's impossible that a lack of "hard work and competence" is the reason that
the remaining 5.87 million failed to become billionaires.

~~~
brd
I wouldn't say my bias is so strong, more that you're allowing labor
statistics to water down what would be meaningful paths to being a billionaire
via the finance industry.

To your point: A large majority of the tech billionaires have software
backgrounds yet only ~30% of the IT industry are programmers. So while the IT
industry may look like a better place than finance, its really programming
that looks better, not IT.

~~~
dalke
I was suggesting that "just hard work and competence" was insufficient to
explain the reason for success.

FWIW, assuming that "newly minted" means "within the last year", only 3 of the
27 listed at [http://www.forbes.com/special-
report/2014/billionaires/newco...](http://www.forbes.com/special-
report/2014/billionaires/newcomers.html) come from the investment industry. 5
come from the entertainment industry.

~~~
brd
I must have misread a headline at some point because the number of finance
billionaires is smaller than I thought. Having said that, of the 268 listed by
forbes, 15 were in finance.

[http://www.forbes.com/sites/alexmorrell/2014/03/06/worlds-
bi...](http://www.forbes.com/sites/alexmorrell/2014/03/06/worlds-billionaires-
newcomers-the-full-list-of-268/)

Anyway, I'd certainly agree that "hard work and competence" is an
understatement but one of the luxuries of being in finance is that your entire
career is built around making money from money. This affords a much more
systematic approach to being a billionaire than you might find in other
industries.

