For points of clarification, a pentamillionaire is a $5 million net worth, and a decamillionaire is someone whose net worth is $10 million. To many, either milestone may seem unreachable. However, it is not. I will explain how. 

I’m going to explain my theory on how to make it into the top 1% of the wealth, how to become a pentamillionaire first, then a decamillionaire, and why it’s so difficult to get there. 

No matter at what stage you are in life, there is a way to accumulate and multiply wealth. But before I get started with my explanation, there’s an important concept that describes the super-wealthy millionaire mind that I need to dive into first.

Know Where You Stand

As a small aside, from a decamillionaire stats perspective, to get into the top 1% of wealth in America you need to have roughly $10 million. If you want to know where you stand on the wealth ladder based on your age, you can use this wealth by age percentile calculator to see what percentile you are in for your age and wealth: Net Worth by Age Percentile Calculator for The USA

And if you’re wanting to listen to this blog post on my podcast, you can listen below:

The Super-Wealthy Millionaire Mind – How the Decamillionaire Thinks

I write about how to create wealth in real estate. I write articles like focusing on the CAP rate, net operating income, how to find a property in the right geographic area, how to value property, and so on.

I write tactical step-by-step articles. It’s my area of expertise. I know what action to take and how to achieve the outcome. 

Here’s what I find interesting, though.

Of the many dozens of individuals I’ve spoken with over the years about real estate investing, very few – maybe three – have ever gone ahead and purchased a building.

I’ll have a two-hour conversation with someone about the steps they need to take in order to get into real estate. I suggest they “do X and then Y.” 

At first, they’re all excited. 

Fast forward two, or even more, years later, and the majority of people haven’t made a purchase.

 When I ask why the answers I hear include “Life got in the way” or “I got busy.”

 What Really Happened?

I had breakfast with a good friend the other day, Kim, from Frame of Mind Coaching, which is where I realized the problem.

Our conversation started on a rather interesting note, talking about raising children, rental analysis, and being an amazing parent. During the conversation, I mentioned that another friend of mine was struggling with some parenting issues, and I was curious about her perspective.

After I finished explaining the problem, she immediately pulled out a pen, grabbed her napkin, and began writing. Here’s the diagram she drew, coffee spills and all. (I left it in its original state rather than reproduce this because I thought it was more authentic.)

Notice the boxes (figures) with arrows pointing from left to right?

My friend said that most parents, and people in general, focus almost entirely on the action and the outcome, but so few people understand their thoughts and beliefs.

She said that people need to start from left to right. People need to understand their thoughts and beliefs first. Only then will they confidently move into the action mode and achieve the outcome.

From Parenting Advice to Financial Advice

Most people like the thought of buying real estate, for example. They understand instinctively that this is something they want to do. They want to create wealth, and they understand that being a landlord is something that will help them get there.

So why aren’t people buying investment real estate? Or along the same lines, why aren’t they quitting their jobs to start that business they’ve been wanting to start for years? 

If you like your job, then great, stay where you are. According to a Gallup poll, however, 85% of people hate their jobs, which automatically decreases productivity

Most people want to take action, like quit their job, start a business, or maybe buy a building. They want the outcome of success.

Most people are afraid to take the risk. They’re afraid of failure.

They ask themselves, what happens if I… 

• Start the company I’ve been wanting to start and run out of money?
• Start the company and don’t sell any product?
• Quit my job to start a company, and things take longer than expected?
• Buy the real estate, lose my job, and can’t afford the mortgage?
• Buy the real estate and then need the money for an emergency?
• The fear of failure is holding most people back.
• Run out of savings and have nothing to support my family?

In short, the fear of failure is holding most people back.

What if you fail?

For most people, the psychological emotion of fear of failure exceeds their motivation to succeed. They stay caught up in the 9 to 5, while the braver lot makes it to the top 1%. 

So What Does All of This Have to Do With How to Become a Pentamillionaire & Decamillionaire, How to Build Wealth, and Make It Into the Top 1%?

First, we need to define what’s considered rich. For the purposes of this discussion, I’m going to say $10 million net worth is the magic number, but, to make it into the top 1% of wealth in America, the actual number is $10.3 million, otherwise known as a decamillionaire.

If your net worth is between $1 to $5 million ($5 million is a pentamillionaire) in America, that will put you in the top 1.8% of the population.

Those with a net worth between $5 to $30 million in America, otherwise known as very-high-net-worth (VHNW) individuals, are in the top 0.2% of the population.

And if you have $30 million net worth or greater, otherwise known as ultra-high net worth (UHNW) in The United States, you are in the top 0.02% of the population.

To achieve that kind of wealth, to become a decamillionaire, requires that you take some potentially significant risks.

Sure, you can get a job, climb the corporate ladder, and become a high-earning executive making $1 million in salary. Put away $400,000 a year for 10 years, invest in the stock market, compound your investments for a few years, and you can achieve $10 million in net worth.

For most of the population, finding a job paying $1 million a year just isn’t attainable. And even if they do, it takes quite a lot of time to turn their savings into an amount this big. 

I’m not suggesting that there’s anything wrong with amassing a net worth of $3 to $5 million. That’s a very high number and can be done with earning a decent salary, being disciplined with your savings, and earning a good return on your portfolio.

The point of this post isn’t to explain how to become a millionaire.

The point of this post is to explain how to become a decamillionaire ($10 million net worth) and how to make it into the top 1%, or top 0.02% with upwards of $30 million or more.

So What’s Different Between Amassing $5 million vs $10 or $20 Million?

From Millionaire to Pentamillionaire to Decamillionaire:

The higher up the wealth stack you climb, the more you need to earn, and the better you need to save. 

And that brings me back to the point I was making earlier. 

You see, many people want to climb the wealth ladder and make it to $10 million or more in wealth. At least, I presume that to be the case for people reading this blog.

Most people ARE NOT willing to take the risks required in order to get there. It’s no surprise that people like to play safe, but that’s not the quickest or most surefire way to make it to the top.

Remember earlier I said the psychological emotion of fear of failure exceeds most people’s motivation to succeed.

Consequently, most people don’t take the necessary risks required in order to become rich. 

Unfortunately, there’s another problem though. Many people do take the risk, they start an amazing company and make millions of dollars in profits. They then waste the money on fancy boats, cars, and homes and don’t know how to save. 

The 4 Steps to Become a Decamillionaire ($10 Million Net Worth)

Before we begin with the steps to becoming a Decamillionaire, I want to make it clear that there is no single rule of becoming rich. However, the steps I am sharing just add up to your millionaire mentality and elevate you to the top 1% group of wealthy people. 

1. Get Comfortable With Taking Risk

To build a successful business or, for that matter, create wealth through investment real estate requires that you take some risks and become comfortable with making some mistakes.

It requires that you keep making strategic risk-oriented decisions, recognizing that you will fail from time to time. But you will succeed more often than you fail.

Over time, as you succeed more often, your bets will become larger and so will the rewards.

If you keep doing that, over and over and over again, and you are disciplined with your saving and investing, you will become rich.

Most people want the outcome. They might even understand what actions they need to take in order to achieve the outcome.

Most people won’t take the risks required in order to achieve the outcome. And for that reason, the majority of the population – 99% to be exact – won’t achieve the level of wealth that will put them into the top 1%.

For those who are willing to take the risks, many have a spending problem and spend more than they make. Keep doing that year after year, and you won’t create wealth.

Darshan Somashekar, who has sold businesses to Facebook and Chegg, and currently runs Spider Solitaire Challenge, explains “While high risk means high reward, you can take calculated risks too. I do hours of research before I start a business to make sure I commit to the right idea. For example, we studied the classic games market for months before launching our spider solitaire games. You can achieve wealth in a risk mitigated way”

2. Thoughts and Beliefs of the Pentamillionaire & Decamillionaire Mind

There’s a reason I spent the beginning part of this post talking about thoughts and beliefs. 

You might say, “I want to become a super-wealthy multimillionaire.” But until you understand your propensity and appetite for risk – one of the necessary ingredients for the rich reward – you won’t get to the top 1%.

Until you address your fear of failure, or whatever else is holding you back, you won’t move to the action stage. 

The action stage requires you to take risks. The action stage requires that you take repeated strategic calculated risk in business.

I’m not trying to trivialize all of the elements required to create super wealth. In his book The Millionaire Mind, Thomas Stanley cites a number of variables as part of what he calls the “success factor.” That includes things like being well-disciplined, having a supportive spouse, working harder than most people, having strong leadership qualities, and quite a few more.

YES, all of the above are important. But sitting at the top is the presumption that you earn bigger dollars. And in order to earn bigger dollars, you need to understand your thoughts and what’s holding you back from taking some of the risks you know you might want to take but aren’t taking.

In other words, that investment triplex you would like to purchase or that business you would like to start, what’s holding you back from moving forward?

3. You Need to Save Much More Than You Spend

The top 1% millionaire mind requires that you understand not only how to earn bigger but how to save bigger as well.

I’ve written extensively about living below your means. It’s difficult to save if you’re spending more than you’re making. However, looking for ways to earn passively can help you expedite the process. So if you can grow a business, for example, to produce $500,000 a year in profits, and you can save $250,000 of that every year (not including taxes of course), then you’re well on your way towards becoming a decamillionaire.

I suggest starting at an early stage. Save 60% of your profits in the initial stage of your business, reinvest the 40% and use the 10% to upgrade your lifestyle. If you compromise on buying a huge house, cars, and dining in lavish restaurants for the first few years, you will have enough savings to not only spend on luxuries but will also be able to maintain a net worth of $10 Million.

4.  You Need Excellent, Compounded Rates of Return 

In the example above, if the business owner can manage to save $250,000 a year in profits and earn an 8% rate of return, in 10 years they’ll have $4,744,000.

I know this might sound like a stretch, but increasing the rate of return by only 2%, from 8% to 10%, compounded for 10 years, will yield $5,346,000.

Now, let’s take the rate of return up to 15%. In 10 years, that will be $7,250,000.

A 15% rate of return sounds too good to be true, especially considering the rates of return from the stock market are only in the 8 to 10% range. But I’m not suggesting that you invest in the stock market or index funds.

I’ve written about how to achieve a greater than 10% return, year over year. For example, in this post, I explained how you can achieve a 110% return in 3 years: Here’s How to Buy an Apartment Building and Make a Whopping 110% in Three Years.

Achieving these types of returns isn’t easy of course, otherwise, everyone would take these risks. But that brings me back to the main thesis of this blog post: in order to become a decamillionaire, to make it into the top 1% of wealth, you need to take strategic risks and must be willing to make mistakes.

The more risks you take, the more mistakes you make, but the more wins you have. As long as you can bat a 70%, then you should keep swinging.

 I now come full circle.

At the beginning of this blog post, I wrote about how you need to become comfortable with understanding your thoughts and beliefs because that’s what’s holding most people back. 

People understand that in order to become “rich,” they need to open a business or buy real estate or take a risk of some sort. They instinctively understand the actions that need to happen. They understand the hopeful outcome. What’s holding them back is their thoughts and beliefs.

8 Steps to Become a Decamillionaire with Net Worth of $10 Million and Make It In the Top 1%

1. Take calculated and strategic risks in business
2. Start saving your income early
3. Maximize profits in your company
4. Invest your business’s profits to maximize returns
5. Sell your company for a large influx of cash
6. Establish many sources of passive income
7. Diversify your assets through multiple asset classes
8. Invest in investment and income-producing commercial real estate
9. Start buying lotto tickets or become the beneficiary of a large estate from your great-aunt (that one was a joke of course).

If you dream big, you can achieve wondrous things. As Eleanor Roosevelt said: The future belongs to those who believe in the beauty of their dreams.

Some fun information, and in case you’re curious:

How Many People Have $10 Million Net Worth?

In America, you need approx. $10 million net worth to make it into the top 1% of the wealth. There are approximately 350,000 people.

In Canada, there are approximately 35,000 people worth $10 million.

And how do you get there? If you have a $10 million net worth, you don’t live a $10 million net worth lifestyle. Live below your means!

According to a successful Texan businessman who owned a Diesel engine rebuilding company, “When my British partners first met me, they thought I was one of our truck drivers…. They looked all over my office, looked at everyone but me. Then the senior guy of the group said, “Oh, we forgot we were in Texas!” I don’t own big hats, but I have a lot of cattle”

Good luck with your wealth-creating journey.

If you enjoyed this post, you might also enjoy this one: How Much Money Do You Need To Never Have To Work Again? Let’s Do The Math.

And this one:  Roth Conversion Ladder and SEPP: How to Access Your Retirement Accounts in Early Retirement

And this one: How Do You Know When It’s Time to Sell Your Business? It’s Not All About the Money.

You should also consider subscribing to my blog. I publish one article a week on small business and wealth creation.  You can subscribe here.

Also, I published a book during the summer of 2018, “The Kickass Entrepreneur’s Guide to Investing, Three Simple Steps to Create Massive Wealth with Your Business’s Profits.” It was number 1 on Amazon in both the business and non-fiction sections. You can get a free copy here.