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How Millionaires Invest & Manage Their Money Differently – Dan Lok

How Millionaires Invest & Manage Their Money Differently - Dan Lok

You don’t have to wait to be wealthy!

Learn how millionaires invest, forget “pinch, save, and wait” plans that make you hold out for 20, 30, even 40 years to start enjoying your money and the great life that goes with it.

Forget get-rich-quick schemes that promise a windfall but carry a huge risk of failure.

If you’re worried about getting burned by financial programs that promise you’ll get rich quick — but you also don’t have the time or the patience to invest in a savings plan that takes 30 or 40 years to take advantage of the “miracle of compound interest” — then this workshop is the wealth-building approach you’ve been looking for.

At this workshop, I will draw upon my own experience and that of experts in the fields of retirement, investing, deal-making and real estate to offer you a complete, step-by-step system for achieving financial independence in just 8 years or less.

If you love my notes and want to get updates on all Dan Lok’s material sign-up for my newsletter or like my facebook page.

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How Millionaires Invest & Manage Their Money Differently – Dan Lok

My Own Financial Journey

I have not always been financially successful. I once struggled from month to month trying to make ends meet. When I first started making more money, I often lived beyond my means and on many occasions struggled to pay my bills on time. Although I appeared (based on my lifestyle) to be doing well, the reality was that I spent much time worrying about money and my financial situation. In my twenties, I had focused most of my energy and time learning how to make more money. I had the belief (WHICH I KNOW NOW TO BE FALSE) that if I could just make more money, everything would work out. I came to realize that just wasn’t true. My income continued to go up but my situation never really changed. The only real difference from when I was younger (and earning less) was that I now had a whole lot more debt and financial responsibilities (burdens). i.e. fancy cars, expensive trips.

Why spending money feels good?
When you’re poor, you are surrounded by things you think you would like to own but cannot to buy. After a while, you associate the feeling of unsatisfied desire with poverty. And when desiring begins to feel poor, having seems like it will make you feel rich.

I realized that just making more money wasn’t the answer. I had to learn how to properly manage my money.  I had to learn how to acquire and create assets that would create wealth.

From that point on, I made it my mission to locate and study all the information I could find on the subject of money: making it, keeping it, spending it, and investing it. And through effort, trial and error and a lot of learning experiences, I developed a set of principles and guidelines.


Why Most Financial Advice DOESN’T Apply To Entrepreneurs

For me, reading financial books was often a frustrating experience. Either the author told a great, motivating story that made me realize that I had to do something. The book was filled with tons of (technical) information that often confused me and almost always gave me more questions (and doubts) than answers.

Why Getting Rich Slow Doesn’t Work
“Get rich slow” is ridiculous – yet you’re being “sold” this very concept everywhere you look. Some morons somewhere came up with the idea the only way the “Average ” person could ever hope to “legitimately” get rich was to do it slowly.

Bookstores and libraries are filled to the brim with financial books that tell you to invest your money little by little and let the miracle of compound interest do it’s “magic.”

So in other words, if you invest a little bit of money every month, then in 10, 20, 30 years, you will have accumulated million of dollars because of the miracle of compound interest and someday decades from now, you will make your F.U. money.

These financial advisors talk about getting rich on your existing income level. They want you to save, live below your means, invest 10% of your income into a mutual fund or pension, and in 30 years, VOILA… you’ll be rich.

So they basically want you to be POOR all of your life so you can somehow be RICH the last few years you’re on this planet – when your old and sick. It’s just fucking insane. Does that sound like a good plan to you? Putting off your hopes and dreams until you’ve worked 40 years?

Be honest with me here, is that what you really want, or is that what you’ve been told that you should want?

Here’s the fact: out of the 100s of millionaires and multimillionaires I know (even a handful of billionaires I’ve met), I don’t know anybody that actually got rich this way. Not even ONE.

My strategies are contrarian, counterintuitive, and unconventional!

“Most entrepreneurs don’t know how to make money. Fewer know how to keep it and almost no one knows how to multiply it.” – Dan Lok


The Only Three Money Principles You Need To Get Rich & Stay Rich

#1 Master The Wealth Triangle

  • Simple but incredibly profound.
  • This is NOT some theory or philosophy.
  • It’s the essence of my 15+ years of financial and business experience, experience gained “down and dirty” in the real world.
  • THIS will give you the Who, What, Why, and When of money.

Most common investing questions I get:

  • “Dan, I’ve got $10K, what should I invest in?”
  • “Dan, what do you invest in?”
  • “Should I pay off my debt first or should I invest first?”

Conventional wisdom teaches you how to get rich on your current income level.
If you can boost your income to $120,000 a year ($10K a month), you should be able to create a million-dollar net worth (not counting your house and car) in 7 to 15 years, assuming you keep your expenses in check.


  • You making you money
  • Develop a skill set that can earn you a minimum of 10,000 a month
  • Turn your expertise, passion or experience into money
  • Trade hours for high dollars
  • Provides you with stability, comfort & peace of mind


  • Your business makes you money
  • A scalable business is one that can majorly grow it’s profits with only minimal increases to your cost
  • Build a world-class team around you
  • Provides yourself with excess cash flow to invest.


  • How Millionaires Invest
  • Your money makes you money
  • Turn your excess cash flow into assets
  • Generate above-average (more than 10%) returns on your money year-in and year-out
  • Only invest in things you understand and can control
  • Grow your net worth and build long-term wealth
master the wealth triangle investing dan lok

You can spend money and enjoy life as long as:

Your first goal: Every year, you will increase your earning ability (high-income skill) by at least 10%.
Your second goal: Every year, you will save more than you saved last year.
Your third goal: Every year, you will increase the amount you save in terms of a percentage of your income.

Save More, Much More

  • < $50,000 a year, save 10%;
  • $50,000 – $200,000, save 15%;
  • $200,000 – $500,000, save 25%;
  • $500,000 – $2 million save, 35%
  • $2 million – $5 million, save 40%
  • $5 million++, save at least 50%


#2 The 7 Levels of an Investor

I learned this from Robert Kiyosaki.
During my in-depth study of “money”, I made a shocking discovery. Despite the many and varied personality types in the world, there are really only seven types (or Levels) of investors. While it’s common for an individual to drift a little from one investor type to another, most people will stay fixed at one level for their entire lives!

People often get caught up in the “I need to make more money “ trap. In fact, your income actually has very little to do with your ability to obtain financial freedom. The Seven Levels of Investing has nothing to do with your income. Rather, they relate to what you do WITH your income.

It’s not how much you make, but rather how much you keep and what you do with it!

robert kiyosaki investing

Level Zero: The Non-Existent

  • NO investments or savings.
  • Completely oblivious of money matters & their spending habits.

They usually complain, “I don’t make enough money. If I just made more money, everything would be OK.” The problem is NOT necessarily their income (or lack of it) but rather their Money Management Habits.

The Sad Story of Mike Tyson
During the 20-year span of his career, Tyson’s income exceeded $400 million.
Yet in 2004, before his 39th birthday, he was $38 million in debt!

Level One: The Borrower

The Borrower is often in a far worse financial position than the Non-Existent, though his or her potential for change may be greater.

The Borrower often has very high debt. Borrowers spend all that they make and more. They know how to CONSUME. Their idea of “financial planning” is to get a new VISA or MasterCard.

Borrowers usually live in complete financial denial. They often come to believe that their situation is hopeless, and as a result, give up all hope.

The Borrowers Financial Planning

Level Two: The Saver

The saver usually puts aside a “small” amount of money on a regular basis. The money is generally deposited into a very low-risk, low-return vehicle such as a money market account or term deposit. Savers usually save to consume rather than to invest (i.e. they save for a new TV, car, vacation.) They’re very afraid of financial matters and unwilling to take any risks.
7 Levels of Investing The Saver

Level Three: The Passive Investor

These investors are aware of the need to invest and usually add to their RRSP (401K in the US) by making employee contributions. Sometimes, they even have outside investments in managed funds, shares and bonds. They make up the two-thirds of the population that we call the “middle class.” However, when it comes to investing, they are financially illiterate.

“I’m just not very good with numbers.”
“I’ll never understand how this _______ investment works.”
“I’m just too busy to follow everything.”
“It’s just too complicated.”
“I prefer to leave the money decisions to the professional.” Or “I have the best financial planner in town, I don’t need to understand everything that’s going on. He’s a great guy.”

They have very little idea where their money is invested or why. These investors blindly follow the market like sheep and then squeal (a lot like pigs) before running to their own slaughter. They also believe that high rates of return on investments are impossible, and probably illegal. It’s also common for these people to whine and complain about missing out on investment opportunities. They love to use “sophisticated” investment techniques such as margins, short-sells, puts, calls, without proper knowledge of exactly what it is they are committing to or the real risks. Passive Investors lose money more than 90% of the time! They’ll never discuss their losses but will always brag about their big wins. They believe that all they need is just one “big hit” to be on easy street. They’re gamblers.

Level Four: The Automatic Investor

Automatic investors are clearly aware of the need to invest. However, unlike Passive Investors, they’re actively involved in their investment decisions. They have clearly laid out written long-term plan that will enable them to reach their financial objectives. They do not get fancy. They rarely use options or margin accounts of any of the other stuff “sophisticated” money managers use. They just buy good shares, proven managed funds or other solid investments and hold them for the long-term.

7 Levels of a Investor - The Active Investor

Level Five: The Active Investor

The top two levels of investor are reached by only a tiny percentage of the people on planet earth. Active Investors understand that to move to this level, they must become very clear on their investing PRINCIPLES and their RULES of investing. Their vehicle of choice might be real estate, discounted paper, businesses or shares. They actively participate in the management of their investments.

They consistently strive to optimize performance while minimizing risk. It’s normal for Active Investors to have long-term annual rates of return of 20 – 100%+. They intimately understand money and how it works. Their main focus is on increasing their assets and thus their cash flow. Their money philosophies vary dramatically from the poor and middle class; rather than investing what is left of their money AFTER SPENDING, they believe in spending what is left of their money AFTER INVESTING.

Level Six: The Capitalist

Few people in the world ever reach this level of investment excellence and fewer still manage to remain there. These are the Rockefeller’s, the Kennedy’s, the Ford’s, the Carnegie’s, and Bill Gates of the world. Capitalists have two principle motivations when it comes to investing: to be a good manager of their money (while they are living) and to leave a legacy (to continue after they are gone)

The Capitalist


#3 Never Invest In Something You Can’t Understand & control

There’s no such thing as a dangerous investment, only dangerous investor. Know what you’re investing in! You have to know the industry. You have to know the business. You have to know the market. The better you know the industry, the better you know the business, the better your track record is going to be. You also have to have a financial system (a set of principles), and an investment system that works. And you have to FOLLOW that system.


  • Marketing control
  • Financial control
  • Key people control
  • Key decisions control

Bonus Money Principle #4 ACT AS IF

  • Act as if you’re already wealthy and then you’ll surely become wealthy.
  • Act as if you have unshakeable confidence and then people will surely have confidence in you.
  • Act as if you’re a leader and people will follow you
  • Act as if you are already a tremendous success, and you will become successful.

Most people save their way to bankruptcy.

Waste not, want not. Be tight, be frugal. Cut up your credit cards. Live below your means. Don’t drink the latte coffee in the morning.


I am NOT talking about living off credit cards or borrowed money. I am NOT talking about spending foolishly either.

You should buy whatever you want as long as your income grows, AND as long as the gap (saving/investing ratio) keeps getting larger.
Instead of cutting up your credit cards, living below your means and always feeling poor.

Three Levels of Thinking

  • Poor person: “I can’t afford it.”
  • Resourceful person: “How can I afford it?”
  • Rich person: “How can I make it make me money?”
save your way bankruptcy

“A wallet once expanded can never retract to its original state. Once you get used to living a certain lifestyle, you’ll do whatever you have to to do to continue living that lifestyle.” – Dan Lok

Rich Dad's Prophecy Robert Kiyosakithe sale of a lifetime harry dent
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