Today, billionaires are arguably some of the most hated people on earth. Despite this, millions of people each year want to know how to become a billionaire, so here it is!
Last week, we covered how to become a millionaire. Here, the premise is somewhat similar, however, you will likely take a lot longer to become a billionaire, than you did becoming a millionaire!
However, I’ll warn you now: Becoming a billionaire is not a quick process. If you want to do it right, it will likely take you much of your adult life, but if you do it correctly, you’ll be glad you did…
What is a Billionaire?
In recent years, the term “billionaire” has seemingly gotten a cult following.
To many, they are what they strive to become, whilst for others, they are “evil” using their money “against the common good” or “not paying their fair share”.
Due to this, the term “billionaire” has lost much of its original meaning. In many ways, it has both gained a lot of things that it isn’t, and lost much of what it actually is.
However, simply put, a billionaire is someone with a net worth of $1 billion US Dollars or more. This means, that they have $1 billion more in assets, than they have debt.
The main difference between a millionaire and a billionaire is quite simple: Three zeros and a comma. A billionaire has one thousand million US Dollars, whilst a millionaire has one million (hence the name!)
Perhaps the most famous billionaires today, are tech entrepreneurs like Mark Zuckerberg, Jeff Bezos and Bill Gates. Other famous billionaires include people like Warren Buffett, and President Donald Trump.
How Realistic is it?
If you’ve even cursory research into how to become a billionaire, you’ll probably see a lot of commenters and “experts” alike tell you something like “It’s not realistic” or “It’s almost impossible.”
And sadly, they are kind of right.
As of the time of writing, there are presently 7.9 billion people in the world. Of these 7.9 billion people, there are only 2,100 billionaires, or roughly 0.00002658% of the world’s population.
To put it in perspective, there are roughly 47 million, millionaires as of the time of writing, or roughly 0.59% of the world’s total population.
These facts are often cited by these “experts” as to how and why you’ll never become a billionaire.
However, that’s not the entire picture. Over the last decade, the number of billionaires in the world has gone from 1,011 (according to Forbes) to 2,100 today (also according to Forbes.
In essence, over the last ten years, the number of billionaires in the world has doubled. Forbes similarly expects that within the next decade, the number of billionaires could rise to as much as 5,000, perhaps more!
So don’t let them get you down. As long as you work hard enough, smart enough, and are willing to put in the effort, even when everything seems lost, you could quite easily become a billionaire!
How to Become a Billionaire
With all that out of the way, here are nine tried-and-trusted ways you could become a billionaire. These have been used by billionaires currently on the Forbes 400 and Bloomberg Billionaires Index…
9. Play The Stock Market
If you’ve ever looked at the price of a stock, you’ll probably have noticed that it tends to fluctuate. Due to a number of factors, stocks go up and down each day, mostly governed by the laws of supply and demand.
To many, this seems like a great way to make money. Essentially, you buy huge volumes of a stock that’s seen a recent decrease in value. This purchase will increase the price, and thus make other investors want to buy it.
Due to this, the price will rise a little bit more (perhaps by as much as ten cents!) with this you then sell the stock. Whilst a ten cent increase doesn’t seem like much, imagine if you did this with one million stocks.
This ten cent increase has netted you $100,000 often in a matter of only a few hours!
Oftentimes, billionaire investors that tend to go down this route start out as a one man operation. Over time, they then employ their own employees, which allows them to do this on a much grander scale.
Here, many of them go on to found hedge funds or investment banks. It is usually when they do this step, that they become a billionaire, mostly derived from the value of the hedge fund/investment bank.
By far the most famous (and richest!) of these-style investors are people like George Soros and Ray Dalio, both of whom have become billionaires in relatively short periods of time…
However, it must be said that whilst there is certainly the chance for you to net millions, if not billions per month, there is also a chance that you’ll lose just as much too!
8. Long-Term Investing
However, for some, playing the stock market is just too risky. Whilst billionaires like George Soros and Ray Dalio may have made billions doing just that, there are thousands of stories of people who’ve lost everything from it.
To many, the safer bet would be to follow famous investors like Charlie Munger, Warren Buffett and Mohnish Pabrai, and invest long-term, using compound interest to your advantage!
Essentially, to invest long term, you’ll want to find a series of great, yet undervalued, stocks that are in industries you have a deep knowledge of. For example: Finance, or media, or aviation.
From here, you buy these stocks and hold them for years, potentially even decades. Then, when the rest of the market catches up, and the price of the stock increases, you sell it for a large profit.
In the meantime, these stocks will also pay you an annual/biannual dividend payment. This is essentially a portion of the company’s profits paid to you each year as a “thank you” for owning the stock…
However, if you want to become a billionaire from long-term investing, you’ll want to start quite early on. For instance, Warren Buffett, started investing when he was seven, becoming a billionaire when he was 56!
7. Try Real Estate
With that being said, stocks, FOREX, derivatives, options and CFDs aren’t for everyone. For some, they’re too complex, whilst others have simply never gotten along with stocks.
Enter real estate.
Unlike stocks and other investments that investors fawn over, real estate is something that you can see, touch, and (if you so desired) destroy. To many investors, this provides a lot more stability than increasingly intangible stocks.
To start with, you may want to purchase what is known as a “starter property”. This is essentially a low-income house or apartment, which can be rented out for a certain amount each month.
Over time, using your starter property as collateral, you can purchase more low-income properties, and similarly rent them out too. As time progresses, you can go from buying a single unit to buying entire buildings!
As this happens, you could transition from low-income rentals to middle class and/or high-income rentals. This not only gives you a better prestige (as no one likes a slum lord!) but also higher incomes per month.
Here, your entire net worth is derived from the value of the real estate you own. By the same token, you make money each month from rent payments coming from your tenants.
6. Build Real Estate
Perhaps a further step, or just a completely separate one, would be building real estate. To date, most countries in the west, actually have what is known as a real estate shortage.
In laymen’s terms, there aren’t enough office buildings, commercial warehouses or residential properties to fulfill demand. All they really need is someone who has the money and knowhow to build them!
From here, it’s fairly simple. You find some great land that can be built on, you hire a great architect to design great buildings, you get permission from the local government and build them.
After doing this, you have one of two options: Sell or rent them out.
For most billionaire real estate developers, they rent them out, however, if you’re going down the previously mentioned route, renting them out is usually what ends up happening!
Usually, billionaire real estate developers start off building one or two houses at a time, before transitioning to much larger projects, such as building large apartment buildings or offices in major cities like New York or London.
Looking at the most successful real estate developers, most of them don’t solely build one type of property. Instead, they focus on a particular kind, whilst occasionally developing the others when it’s profitable to do so!
Perhaps the most famous (or should I say infamous) billionaire real estate developer is President Donald Trump. Whether you agree with his politics or not, he has certainly left his mark on the New York skyline.
5. Invent Something
If you look at the top ten richest people on the Forbes 400 at the minute, you’ll find all but two of them invented something.
Whilst these inventions have helped millions around the world, they’ve also made their inventors millions in the process!
And that’s the key point. They are useful and help people in ways they never thought possible. You can invent as many things as you want, but if they don’t help people, they won’t buy it.
Take for instance, the airplane. Prior to the Wright Brothers first flight in December 1903, the fastest way to travel was by train, and that was still comparatively slow.
However, following the Wright Brothers first flight, the concept of airliners quickly became widespread. Within less than 15 years, there were a number of other companies had built their own airliners.
These were then sold to early airlines and wealthy businessmen for millions of dollars in today’s money. This soon turned many of these airplane inventors into millionaires!
Whilst it’s unlikely you’ll invent the next airplane, there are certainly a lot of other things you could invent. If done correctly, you could sell your inventions to people for millions of dollars a pop and soon become a billionaire.
However, just don’t forget to patent your invention or else you risk someone ripping you off…
4. Reinvent Something
However, many people will point out that inventing something is difficult, as most things that do need inventing, have been. Inventing something new is also quite expensive, something you can’t afford right now…
Alas, if you have an inventive mind, this fact shouldn’t stop you. Quite the opposite in fact. Instead of making something brand new, you could perhaps take something old and make it new again!
By far the best example would be the telephone. The first telephones were invented in the 1870’s, and were quite different to the telephones we have today.
Over the course of 150 years, the telephone went from being a rather clunky, stationary item that required a team of operators, to something so small and mobile it could fit inside your pocket!
Whilst it’s unlikely that you’ll reinvent the phone once again, you could look at something that’s similarly old, but used by the masses. From here, all you really need to do is reinvent it and market it.
In only a few years, you might be a millionaire, and a few more after that, a billionaire.
3. Start Your Own Business
If you’ve ever done any research into starting your own business, you’ll probably be told that, if done correctly, starting a business could be your path to becoming a billionaire!
Indeed, looking through the Forbes 400 or Bloomberg Billionaires Index, almost all self-made billionaires did so by starting their own business, even if it did something else in this article…
With that being said, starting a business isn’t easy. Sadly, it doesn’t get any easier as your business gets larger, the problems similarly get larger, and often, more complex.
Although, if you get past this, and continue to grow your empire, you could quite quickly become the industry leader. From here, if done correctly, you could get to such a point where you become a billionaire!
However, you have to remember one thing: It needs to provide value. You can start up as many businesses as you like, but if they don’t genuinely help your customers, everything will be an exercise in futility.
Take this website for instance. Sadly, it’s unlikely I’ll become a billionaire from running this site (but it may one day be worth a million!) however, it won’t grow if the content we publish doesn’t help people.
This is the same concept for your business too. It doesn’t need to be a charity, but the good or service you provide needs to be beneficial to your customers/clients in some way, shape, or form.
2. Become a C-Suite Executive
If starting your own business sounds too risky, there’s always another way you can go about it: Working your way to the top. In essence, you go from lowly employee, to the top dog in the business.
To do this, you’ll likely want to start doing this quite early on. Perhaps starting in your late twenties ad/or your early thirties at the very latest.
Here, you join a company straight out of high school/college (depending on the job) and work as hard as possible. This means extra work and overtime, essentially becoming an invaluable asset to the company.
Over time, you are promoted higher and higher, going from lowly employee, to supervisor, to manager, to middle-management. From here, you distinguish yourself to the point where you become an executive.
From here, you take a large portion of your wage in company stock. If you’ve chosen well, this would be a multibillion dollar company currently listed on the stock exchange, whose price fluctuates everyday.
If done correctly, and in high enough volume, you could soon own a large portion of the company, as well as becoming a billionaire in the process…
The more common way, however, is doing everything that’s mentioned above, but then going to work for a startup that’s not had an IPO yet. Here, you pay yourself in loads of stock before the IPO and sell it all to become a billionaire!
1. Become a Celebrity
To many, however, becoming a billionaire is a dream. However, spending decades surrounded by stocks or real estate or inventing something new, just simply isn’t for them. Becoming a celebrity, however, is.
Indeed, there are a number of celebrities who have cashed in on this popularity, with some even going as far to become billionaires!
Looking on the Forbes 400 and Bloomberg Billionaires Index, there are a handful of extremely famous celebrities, mostly sportsmen, who have a net worth of more than $1 billion.
For most of them, they have become a billionaire somewhat by accident, with their love of sport just happening to turn them into a billionaire.
Oftentimes, they started out as a sportsmen, before signing multimillion dollar deals with sponsors. This got their name out there, which has then spiraled into a business in its own right.
This business has then boomed, partly due to the celebrity’s image, but also their business acumen, which has increased their net worth over the $1 billion mark.
Perhaps the most famous of these celebrity billionaires are Oprah Winfrey, George Lucas and Michael Jordan, among many, many more!
How do you want to become a billionaire? Tell me in the comments!
