Creating Wealth with Real Estate: A Simple Plan

Several real-life millionaires are profiled in the book, “The Millionaire Real Estate Investor,” by Gary Keller. Collectively they reveal several ways to become a millionaire by investing in real estate although each of them took a different path.

That alone is reason enough to read the book. For those of us who are serious about real estate investing, is there anyone better to learn from than someone who has actually achieved the goal and provided a roadmap? The simple answer is that there is no one better to learn from. You model their attitudes and beliefs and follow their proven plan and ultimately you’ll achieve the same results. It’s as simple as that.

One of the plans from the book stood out from the rest so that’s the one I’ll focus on in this article. But first you need to decide what you want to create with real estate: income or wealth? They are not the same thing.

Basically income is what you earn and wealth is what you keep. It’s not uncommon for six-figure income earners to be almost bankrupt because they spend, spend, spend. On the other hand, it’s not difficult to find others who have become millionaires on meager wages because they were smart enough to invest all they could and watch it grow.

OK so what’s the plan? This particular investor and his wife began by paying the mortgage on their personal residence. Each month, they paid the regular mortgage payment plus whatever they could afford to pay extra. I believe it took or years. Considering the average mortgage is 30 years, that’s excellent.

Then they bought an investment property and put a renter in it. Since their own house was paid off, they had more cash flow to pay off their first investment home. The rent plus the cash they had been paying towards their own mortgage went to pay off this mortgage. This house was paid off in or years.

They simply repeated this process over and over again. However, each time they bought another investment house, they had more cash flow to pay off the mortgage and consequently they owned the house free & clear more quickly with each property. For example, on the third house, they had not only the money that had been going to pay off the house they lived in, but the rent from the second house (since it was owned free & clear) plus the rental income from the third house itself. They owned the third house free & clear in less than 3 years.

It’s not a way to get rich quick, but it’s a practical plan for creating wealth. They owned two investment properties free and clear in about 10 years. In 15 years, they owned about 4 houses free and clear. And they’d own 8 houses totally free of debt in around 20 years. How much is the median home price in your city? Multiply that by or by. You could live quite comfortably off that, right? If that average price of a house where you live is $250,000, you’d have one million dollars in real estate free & clear in only 15 years.

Appreciation, the annual increase in value, is one of the best qualities of real estate and we haven’t even mentioned that yet. If you needed cash, you simply take out a mortage on one of the properties and deposit the proceeds in your bank account…tax free!! That’s a fact. The IRS does not impose taxes on the proceeds of a mortgage. That’s a fabulous plan

How Many Millionaires are There in the World?

The word millionaire is generally used to describe a rich person. When we speak of a millionaire, we think about mansions, limousines and yachts. But what is the most accurate definition of a millionaire? The most recognized definition of a millionaire is a person who has financial assets of at least US$ 1 million, excluding the home value. Despite of the images that we associate with this word, the amount of US$1 million nowadays is no longer what is used to be some decades ago. Many people who have this amount today live without luxuries and do not feel rich. However, this amount is used as a measure to differentiate privileged people, who are known as HNWI (High Net Worth Individuals).

Becoming a Millionaire Investing $5,000 – Reality of Fantasy?

Assuming that history will repeat itself, if you invest $5,000 in the 25 top performing stocks you will be a millionaire in less than 25 years! What is the catch? We are not talking about today’s top performing stocks. We are talking about the top performing stock in the next 25 years. A quarter of a century ago if you had a crystal ball and had invested $200 in each of the top 25 performing stocks, today you would have $1,370,000!

If you are curious to know what great stocks you may have missed, here is a list of the top 25 performing stocks and their corresponding percentage growth in the last 25 years as reported in the USA Today:

1. Franklin Resources - 65,224%
2. Danaher - 47,913%
3. Eaton Vance – 38,444%
4. UnitedHealth – 37,672%
5. Cisco Systems - 33,632%
6. International Gaming Technology - 33,436%
7. Biomet - 30,531%
8. Microsoft – 29,266%
9. Best Buy - 28,703%
10. Oracle – 28,535%
11. Stryker – 25,383%
12. Countrywide – 24,160%
13. Expeditors International – 23,860%
14. Home Depot – 23,845%
15. Dell – 23,048%
16. Robert Half – 21,170%
17. Credo Petroleum – 20,180%
18. Adobe Systems – 19,989%
19. Precision Castparts - 19,437%
20. Berkshire Hathaway – 19,424%
21. Smithfield Foods – 19,414%
22. Paxar – 18,923%
23. Time Warner – 18,158%
24. Paychex – 17,920%
25. Harley-Davidson – 17,808%

Obviously looking back in the rear view mirror is much easier than looking forward. In order to achieve the results above not only would you have needed the fortitude to select these stocks before they became household names, you would also have had to hang on to these stocks even when their prospects were bleak. Today they are considered super stocks, but back in the early days their future prospects were not so clear. Oracle for instance had a near death experience during this 25 year period.

If you are like most people, guessing the next 25 top performing stocks in the next 25 years is nearly impossible. Your best shot is probably to invest in a few potential super stocks and, if you have some luck, you may just find one that becomes a top performer. How do you go about finding such a gem? Perhaps you can start by looking for the next megatrends that will drive the growth of the next super stocks. In the article Megatrends-Based Investment Ideas.we share some potential areas that you may want to investigate. You probably have observed other magatrends yourself that may become a good investment theme.

Once you have identified a good investment theme you should follow the advice of those that have already succeeded. In the article achieve success with your investments, we share some advice from one of the most successful investment families in America. Notice that the very first advice in that list is to set realistic expectations. Therefore, you shouldn’t expect to repeat the spectacular return of any of the stocks listed above. Historically stocks have retuned on average 10-11% per year. At this level of return, you can expect to double your money about every 7 years.

So, with an average return, you should expect your $5,000 investment to be worth somewhat less than $80,000 in 25 years. This is still a very good return on your investment. But if you are looking to become a millionaire in the next 25 years you will probably need to invest more than $5,000.

Unless of course you are one of the lucky few who can find a super stock and will hold it for the entire period.

Millionaire chess player plans moves to eliminate Missouri income tax, St. Louis earnings tax

ST. LOUIS — Multimillionaire Rex Sinquefield has deep pockets and an even deeper interest in Missouri politics. And his retirement strategy meshes both. After making a fortune as an investment banker, Sinquefield is prepared to spend millions in the next few years to influence the Missouri public and help elect state and local officials who share his disdain for income taxes and troubled urban public schools. Missouri's elimination of campaign-donation limits could further help his cause and those of others with bankrolls big enough to wield influence in the state. Sinquefield's moniker and money are expected to be prominent on this week's campaign-finance reports, the first for statewide candidates since the limits were removed. The St. Louis native moved back to the state just two years ago after being away for 35 years. But he's swiftly making up for lost time. Sinquefield already has spent a bundle to help establish the Show-Me Institute, a free-market think tank based in Clayton. With an eight-member board of prominent bankers, economists and some Republicans, the institute pays for research studies into many of the issues that Sinquefield cares about, from the state's minimum wage to St. Louis' earnings tax. (He opposes both.) The institute, and the prospect of generous contributions, are among the reasons why Sinquefield has swiftly found himself on a first-name basis with most of Missouri's top elected officials in both parties. Many of them have been invited to the 1,000-acre estate that Sinquefield and his wife have built within the past five years on the banks of the Osage River, just a few miles from Jefferson City. The couple recently purchased a three-story mansion on one of St. Louis' historic private streets in the Central West End. Sinquefield plans to spend half of each week in the city to pursue his interests in philanthropy, sports and politics. "My whole motivation is to try to make Missouri a better place,'' he said. "I have no secret issues. I have no secret agenda." Sinquefield's direct approach has won him admiration, even from those wary of his objectives. "We just click on so many levels, on so many issues,'' said Lt. Gov. Peter Kinder, who agrees with Sinquefield's quest to abolish Missouri's income tax. Gov. Matt Blunt calls him a friend. So does House Speaker Rod Jetton, R-Marble Hill, who added, "People draw attention sometimes because of what they are worth, but Rex is a guy who achieved a great deal of success on his own and has gotten a lot of attention because he shows passion about some big issues." Former Gov. Bob Holden and current Secretary of State Robin Carnahan, both Democrats, also have dined with Sinquefield although both note they disagree with many of his stands. Holden, who's known Sinquefield for years, calls him a "generous and thoughtful person who wants to give back in his own way." Carnahan offers similar praise, but adds, "My sense was that he hasn't done a serious study of how his proposals would affect real people and the vital services that they expect from state government." Jim Kottmeyer, a consultant with several groups who have actively opposed Sinquefield's ideas, says there's no doubt that the multimillionaire's presence — and his pocketbook — are rapidly affecting the state's political landscape. Some of Sinquefield's political critics, for example, are afraid of attacking him in public out of fear that he'll heavily bankroll a political opponent. Said Kottmeyer: "I don't think they've seen anybody like him in Missouri.'' Raised in orphanage Sinquefield's rags-to-riches life is one of his attractions. Born in St. Louis, he spent six years in St. Vincent's orphanage — roughly ages 8 to 14 — before reuniting with his widowed mother and older sisters. He graduated from Bishop DuBourg High School near St. Louis Hills. Sinquefield attended Cardinal Glennon Seminary for three years before deciding the religious life was not for him. "I was studying to be a bishop. They said, 'Wait a minute, you have to be a priest first,'" Sinquefield recalled with a chuckle. He transferred to St. Louis University, graduating in 1967 with a business degree. In 1968, at the height of the Vietnam War, Sinquefield was drafted into the Army. But instead of being sent overseas, he was placed in the finance corps based at Fort Riley, Kan. After a two-year military stint, Sinquefield worked for banks in St. Louis and Chicago, the latter while also acquiring an MBA at the University of Chicago. He spent nine years with the American National Bank of Chicago, working his way up to be the head of its investment section and later, the trust department. His love of investing prompted Sinquefield to leave the bank in 1981 to co-found Dimensional Fund Advisors with business partner David Booth. The firm quickly grew, and now employs 330 people worldwide. In 2006, it managed at least $138 billion in funds. A spokeswoman confirmed that the firm's owners include employees, board members and 28 outside investors, including California Gov. Arnold Schwarzenegger. Long based in Santa Monica, Calif. — which Sinquefield dubs "Soviet Monica'' because of its high taxes — the firm now is relocating its headquarters to Austin, Texas. The draw: Texas doesn't have an income tax. Income tax battle Two years ago, Sinquefield retired from the firm to pursue his political and personal passions. His mantra, which he preaches to everyone he meets, is that state income taxes hurt job growth and economic prosperity. He makes the same argument about the earnings taxes levied by the cities of St. Louis and Kansas City and the minimum wage. In the case of state income taxes, Sinquefield points to the rapid growth experienced the nine states — including Florida, New Hampshire and Washington — that don't impose an income tax. The state income comes from other taxes, such as sales taxes. "The absence of that (income) tax is a powerful magnet,'' Sinquefield said. He also seeks constitutional restrictions on state spending. But Kottmeyer asserts that eliminating Missouri's income tax is "a dangerous idea for the state's economy. It's a giant tax break for the rich and a giant tax hike for consumers'' who would be saddled with higher sales taxes. As for St. Louis' earnings tax, Sinquefield proposes replacing it with a land tax that would be separate from a property tax. He notes that many city officials and corporate executives are looking for alternatives to the earnings tax. On the education front, Sinquefield is among several institute board members who have intervened in court against the 250-plus Missouri public school districts who are suing for changes in the state's aid-allocation formula. The Show-Me Institute has issued studies that generally agree with Sinquefield's views. But the experts who conduct the studies say he wielded no undue influence. "I have dealt with people who tried to direct research once they've commissioned a report from me,'' said Joseph Haslag, an economics professor at the University of Missouri-Columbia who has conducted several studies for the institute. "My relationship with the Show-Me Institute and Rex has been the exact opposite.'' Among Sinquefield's disappointments was last year's overwhelming statewide vote in favor of Proposition B, which increased Missouri's minimum wage to $6.50 an hour, up from $5.15. He agrees with business groups that particularly oppose the measure's mandate of annual cost-of-living increases, which Sinquefield contends will cost jobs. Kottmeyer advised the groups in favor of Proposition B, and says last fall's results were evidence that Missouri voters disagree with Sinquefield's views. "Rex has certainly got an agenda that has been rejected by a majority of Missourians,'' he said. Sinquefield replied that when it comes to a minimum wage, "Some things have common sense appeal, but they're just wrong." Known for chess, charm Sinquefield's passion for government change is softened by what even his critics describe as charm and compassion. Holden, for example, said Sinquefield offered one of the buildings on his estate for a Holden family reunion held when the former governor's mother was gravely ill. And Sinquefield and his staff emphasize that he's donating far more money to other personal passions besides politics, such as the symphony, St. Vincent's and after-school programs for the urban poor. A chess fanatic, Sinquefield is offering to start and bankroll a regionwide chess program for children. He's also honing his own chess skills to return to the tournament circuit. Sinquefield often plays chess online with other chess experts, in games that can take days for a single move. He appears to be adopting the same methodical, patient approach to state and local government. Sinquefield said he recognizes that it may take years for his vision to take hold. But he also is upfront about his political expectations. Sinquefield acknowledges that he's willing to pour millions of dollars into the campaigns of like-minded politicians. But he added that he'll contribute to campaigns only "as long as it advances this agenda." "If it doesn't," Sinquefield said with a smile, "I won't."

West leaving Grizzlies as St. Charles millionaire tries to refocus franchise

A day after St. Charles multi-millionaire Michael Heisley said he will pull his Memphis Grizzlies team off the NBA open market if he can’t find a buyer this month, Jerry West announced he will leave as the Grizzlies’ director of basketball operations July 1.

West said he’s “not a youngster” and weary of the turmoil surrounding the team.

West, one of the NBA’s 50 greatest players, will end a five-year stint with the Memphis franchise. The NBA legend, who turns 69 in May, had been under contract only through this season and said Tuesday many factors played into his decision.

“I think the wear and tear of the season, particularly like this (has been tough). There’s been a lot of turmoil here. The ownership thing have made it very difficult to concentrate on what we need to do here to improve our basketball team.”

He did not indicate any immediate jobs he was considering in the NBA.

Michael Heisley

The Grizzlies (21-60) have the worst record in the league and their troubles on the court have been compounded by the possible sale of the club. West fired Mike Fratello in December and hired Tony Barone as an interim coach.

The announcement of West’s departure came a day after Heisley, the team’s majority owner, said he would abandon his yearlong pursuit of selling the franchise if he does not have a viable offer by May 1.

“I think (Heisley) pretty much said it (Monday) night when he said he wanted me to put in place a future management team,” West said.

West added he had told the owner: “I thought it was very important that we have a new voice here.”

West will advise the team through the draft and the hiring of a new coach. Barone was given the job on an interim basis after the firing of Fratello. He said he believes two people should be hired to take over his duties - a general manager and a vice president of basketball operations.

West, whose silhouette from his playing days is featured on the NBA logo, won eight NBA titles as either a player, executive or consultant with the Los Angeles Lakers.

Monday, Heisley explained his situation with the franchise, saying “I’m just basically tired, and I’m a little worn out. “I’m going to get re-involved, and we are basically going to run the team.”

Former Duke players Brian Davis and Christian Laettner tried to buy the team, but they couldn’t come up with the $252 million needed to purchase Heisley’s controlling share or the $360 million necessary to purchase the team.

Heisley said he has talked to two or three groups about the sale, but nothing has been accomplished.

Heisley said the team will now concentrate on the draft, hoping to land one of the top picks.

“We have a chance in this draft to get a tremendous player,” he said. “This is probably the strongest draft since I’ve been in the NBA. Hopefully, God will shine on us and give us the pingpong ball.

“Obviously, we’re very anxious and hopeful that we will get either one or two.”

Heisley said he still thinks the franchise would be better with a new owner.

“I truly believe Memphis deserves to have an owner who lives here, who’s active, who’s really involved,” Heisley said. “Someone like (Dallas Mavericks owner) Mark Cuban, who would basically energize the situation. I think that would be better than having a guy like me, who’s 70 years old.”

The Millionaire Myth

You could say rugged individualism is the American way. It's the story we see all around us. It's the ethic behind Hollywood's power hitters, and it's behind the Horatio Alger mantra that, no matter what, we can all pull ourselves up by our own bootstraps. We're told all we have to do is buckle down and work hard, and eventually we'll succeed.

That's the story we're told -- and it's the story we believe when we read about John D. Rockefeller, Henry Ford, Bill Gates, Warren Buffett and a few women such as Mary Kay, Martha Stewart and Oprah, or any of the millionaires and billionaires whose stories surround us on television and in magazines.

The usual line is that these people struggled against terrific odds, alone against the world. They achieved the American dream and became extremely wealthy because they were extraordinary individuals. To make it in this world, we're told, you've got to make things happen on your own. We've all been taught that the way to make money is through individualism. To get ahead, you have to do it on your own -- it's all up to you.

There's only one problem with this story: It's not true. The financially successful people you see all around you did not get there on their own.

I'm going to tell you in this book exactly how people in the Millionaire Zone got there. And I'll tell you exactly how to make this solution work for you, just like the real-life stories you'll read.

After years of working with, talking to and observing very wealthy individuals, I began to see a common theme. Successful people don't get there alone. That's the revolutionary message behind this book.

There are thousands of theories espousing the next great way to get rich, but you have to execute them on your own. You have to get into real estate on your own, you have to daytrade on your own, you have to do X or Y or Z on your own. It's always all on your shoulders. The experts say, "Here's how, now go out and get 'em!" That's very simplistic and of little real value. You either get it or you don't. Good luck!

The typical working American rarely achieves anything substantial by going it alone. We're too busy with our kids, dragged down by our jobs, fearful of the risk, unsure of what to do, or confused. Sound familiar to you? You're not alone. According to my research, 53% of Americans say they'd like to supplement their income or start their own business but feel anxious about venturing out on their own.

The Rules Have Changed

Even when I attended business school, the fundamental philosophy seemed to be to just go out, find a job and make money. That usually meant to go work for someone else.

But these days, that's dicey advice. Who wants to be at the mercy of a company for the rest of their working lives when jobs are being sent overseas, mergers and buyouts are wreaking havoc with employees' lives, and "right-sizing" (i.e., slashing jobs) is the name of the game?

It's harder than ever to get ahead, now that the loyalty bond between employer and employee that was there during our parents' generation has evaporated -- the victim of a global economy, the technological revolution, disappearance of pensions and corporate America's never-ending search for higher quarterly earnings.

Companies such as United Airlines (UAUA - Cramer's Take - Stockpickr) and Bethlehem Steel, which promised generous pensions and medical benefits in retirement to the workers who were loyal to them for decades, have since reneged on those promises.

These days, even financially healthy companies such as IBM (IBM - Cramer's Take - Stockpickr - Rating) and Verizon (VZ - Cramer's Take - Stockpickr - Rating) are freezing their pensions, meaning that workers will end up with far fewer guaranteed benefits than they were expecting. Meanwhile, half of American workers don't have any kind of pension at all, and most of the rest are relying on a 401(k) plan -- the very epitome of go-it-alone.

With a traditional pension your benefits are guaranteed, but with a 401(k) all the risk is on the individual to save enough (your employer's matching contributions notwithstanding), make the right investment choices and figure out how to make your nest egg last through your retirement.

And trust me, even if you did save through your 401(k) during your career, chances are you wouldn't be close to having what you need for retirement: A 32-year-old who makes $30,000 a year until age 67 would have only $102,750, assuming he or she contributed 3% of salary to a 401(k) and received a company match of 1.5%, according to Vanguard. So much for the golden years.

Here's another sign that it's only getting harder to get to the Millionaire Zone, especially if you're trying to do it on salary alone: The inflation-adjusted income of the median household in 2004 was 3.8% lower than in 1999, according to the Economic Policy Institute's analysis of census data.

The reality of our wages situation, combined with disappearing pensions, higher college costs and rising health-care costs, is hitting our savings rate hard: Personal savings has been running negative for 16 straight months. How do you get a negative savings rate? By borrowing money or selling assets to support your spending habits.

Now take a look at the returns on your own money. How have you done? Have you handled your savings like millions of others, leaving it in a checking or savings account at, maybe, 3%? Are you among those who, even if you've stashed money aside through your 401(k), didn't carefully choose which funds you're invested in? Is what you're stashing in your retirement account going to get you through retirement? Get your kid to college? Enable you to start that nonprofit you always dreamed of?

Obviously it's important to keep some money invested in low-risk, low-return investments. You want a balanced portfolio, and you want to invest according to your risk tolerance. But you also need to consider your future and decide whether moving yourself closer to the Millionaire Zone requires taking some steps toward higher returns.

Yes, these statistics are depressing. But rather than letting these numbers beat you into submission, consider them a wake-up call. The American dream is still very much attainable. The impact of the economic dislocation our society has undergone in the last 20 years just means we need to change the rules of the game, so that the dream remains ours.

What about turning $5,000 into $1 million? Many have done it, and you'll hear some of their stories in this book.

My experience is that average working Americans are severely disadvantaged. Even if they've dedicated 20 or 30 years of their life to one company, it's unlikely they'll ever create a seven-figure fortune. And many of them seem to know it: 50% of employed Americans surveyed for this book said they are "very" or "somewhat" pessimistic that they will make a lot of money in their lifetime. For most of us, to achieve real financial independence, the only way up is out!

Millionaires' Row with an £800,000 cannabis factory

During the recent warm snap, many of us would have given a lot to have access to our own private swimming pool.

But for the occupants of one house on Millionaires' Row, a quick dip was out of the question - instead, they had filled the pool with cannabis plants worth £800,000.

Police who raided the property following a tip-off said they were left "speechless" when they discovered the massive cannabis factory, complete with special lighting, heaters and fans.

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The outisde of the rented house at posh D'urton Place of D'urton Lane in Broughton

They are seeking a group of people who are thought to have been renting the £500,000 property from its owner.

The discovery was made on a lane of substantial, detached houses north of Preston, Lancashire, after a warrant was issued over an unpaid fine and the occupant was spotted running away.

Officers forced their way in and stumbled across the industrial-scale cannabis plantation in the indoor pool at the back of the property.

Chief Inspector James Lee said what they found had left them "speechless".

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Inside the £1m house were cannabis plants with a street value of £800,000

He added: "We have had experienced officers working at the scene and they have never seen a drugs cultivation operation like this in more than 20 years of conducting police searches.

"The most staggering aspect to this is we expect to recover somewhere in the region of 1,000 fully grown plants which is likely to put this seizure, in terms of street value, of between £700,000 and £800,000."

Neighbours had noticed the hum of electrical equipment coming from the 30ft pool but assumed it had been for heating the water.

They said a group of Chinese men had been living there recently but no-one had any inkling of what was going on inside.

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A police chief said he was 'speechless' at the size of the haul

"We have seen two Chinese men who haven't been there long, but everyone in this area keeps themselves to themselves," said one.

Police used a helicopter in an unsuccessful attempt to trace the man seen fleeing the property. A 30-year-old man arrested at another address has been released on police bail.

Chief Inspector Lee said: "We know the property was rented to two men and two women, described as Oriental. We urgently want to trace them and would urge them to come forward and speak with police."

They are also looking for descriptions of vehicles seen at the house and for anyone who knows the identity of the man who fled the house to come forward.

Last year police warned of the growing number of cannabis factories in unassuming suburban locations and issued advice on how to spot them.

A typical domestic factory of the sort raided in London alone at a rate of two a day can produce as much as £30,000 worth of skunk every three months.

Larger-scale farms of the type found in Preston can yield £8million a year, much of it ploughed back into more serious crime.

The gangs behind them - often, according to police, from Vietnam or elsewhere in South-East Asia - frequently tamper with the mains supply to get free electricity to light the plants, making them major fire hazards.

Telltale signs include windows and doors being sealed with blinds or sheets and a pungent smell emanating from the property.

The house where the plants were found, named D'Urton Place, has a chequered recent history. It was bought in 2002 by Malaysian-born hospital psychiatrist Dr Karrupiah Selvam who moved in with his new wife Lynda.

However he later discovered she had still been married to her third husband at the time of their wedding and reported her to police, and she was jailed for bigamy two years later.

Dr Selvam sold the property last year to Indian businessman Mohamed Vali for £475,000 but he has not lived there, instead telling neighbours he plans to knock the sprawling mock Tudor property down and build a modern house on the site.

Since then he has been renting the large, detached house - which has a pool and snooker room in two separate outbuildings - for a reported £2,500-a-month.

A neighbour in a beautifully-kept 1920s home nearby said: "I thought 'That's a bit steep at £30,000-a-year', but I didn't know then what they were using it for.

"With the sort of profits they were making from cannabis, the rent would have been a drop in the ocean.

"They didn't care about the place though - the garden is a tip but no-one ever went out there to do anything. They must have been too busy inside.

"This is not the sort of place you would associate with these type of people. Those who live here tend to be well-to-do or retired.

"You wouldn't expect drug runners on a road like this but I suppose you never see anyone so you wouldn't know. All the houses are surrounded by high fences and mature bushes."

A woman whose detached property backs onto the house added: "You would see this infra-red type light at night coming over the fences or through the bushes.

"It was very eerie but everyone just thought it was some sort of security system. No-one thought it could be a cannabis farm in an area like this.

"You never saw the lights in the main house go on or off and it was rare to see anyone there although occasionally a grey car was parked outside."

The Sleepwalking Millionaire

A million dollars seems like a lot of money because, well, it is a lot of money. Thing is, racking up that sum isn't nearly as difficult as most folks imagine. Indeed, after putting just a few sound financial principles into action, you can basically sleepwalk your way to financial independence. Here's a two-step plan (pun intended) for doing just that.

1. Take maximum advantage of your company-sponsored retirement plan. The 401(k) contribution limit for tax year 2007 weighs in at a hefty $15,500. Even if you can't kick in quite that much, do everything you can to contribute enough to take full advantage of your employer's matching contribution, if one is provided. Hey, that's free money -- and because your contributions will be automatic, once you set the wheels in motion, they'll just keep turning without additional work on your part.

And just how far will those wheels take you? Quite a long way. A 40-year-old who kicks in $10,000 each year between now and age 62 will have more than $760,000 if her investments match the S&P 500's historical rate of return: 10.5% annualized.

Not too shabby, eh?

2. Fully fund a Roth IRA and watch the tax man vanish. Impressive though the figure above is, you still have some work to do if you want to be a millionaire by the time retirement rolls around. Enter the Roth IRA. Set one of these puppies up, kick in the maximum each year ($4,000 for 2007), and voila: At the end of 22 years, you'll have nearly $305,000 at 10.5%. And get this: Uncle Sam won't expect a dime on the withdrawals, either.

That deal is sweet indeed, particularly since, unlike with your company-sponsored retirement plan, you're in the driver's seat. You might choose to invest in individual stocks, bonds, or -- if you're looking for a no-muss, no-fuss vehicle -- mutual funds.

Indeed, world-class actively managed funds make great candidates for IRAs because you won't have to pay taxes on the capital gains and dividends they generate. Still, even if you opt for a "no-brainer" lineup of index picks, you can improve your odds of earning a rate better than 10.5% -- and of becoming a sleepwalking millionaire even sooner. For example, the iShares Russell MidCap Value (IWS) ETF -- which counts Dynegy (NYSE: DYN), Level 3 Communications (Nasdaq: LVLT), and Rite Aid (NYSE: RAD) among its holdings -- tracks a benchmark that cranked out an annualized return of 14.91% for the 15 years that ended with March 2007.

Meanwhile, MidCap Value's bigger brother -- the namesake benchmark of iShares Russell 1000 Value Index (IWD) -- has managed "just" 13.04% annualized over that stretch of time. Investors who track this bogey are hitching their wagons to comparatively buttoned-down big boys such as Pfizer (NYSE: PFE) and Kraft (NYSE: KFT). Valero Energy (NYSE: VLO) and Wells Fargo (NYSE: WFC) are in the mix, too.

No matter which way you go, the bottom line with Roth IRAs is this: The market is your oyster. Feel free to pick pearls -- and watch 'em grow tax-free.

The Millionaire in Your Carpool

Is there a millionaire in your carpool? Probably not because odds are millionaires don't carpool.

Still...

A growing number of TSP investors now have accounts that are worth well over one million dollars! But if you don't, don't feel bad about it. You haven't done anything wrong and you didn't miss any good investment bets.

The TSP millionaires are all people who transferred money - from outside IRAs and 401(k) plans - into the federal 401(k) plan. In fact at least one person moved $1 million into his account shortly after joining the government. Reason: The safety of the G-fund and the low administrative fees of the federal TSP.

While nobody has yet earned (as opposed to transferred in) $1 million within the TSP, a growing number of federal investors now have accounts worth more than $500,000.

In fact consider this e-mail I got yesterday morning:

Hey, Mike, Didn't you sometimes mention, in your Washington Post column, the TSP balances of people you knew in the Federal Government? That always encouraged me to max out my own contributions. Now, after 17 years with HUD, my own balance is approaching $400,000 in the L 2040 fund. Not bad for a Government worker! Thanks.

Not bad indeed. In fact great! Imagine if the HUD employee had been investing the max from day one of the startup of TSP. Which he couldn't because he joined the government three years after the TSP was launched. Obviously he maxed out, and invested in stocks as opposed to the safer but more conservative alternatives.

The TSP will celebrate its 20th birthday this month. When it started it had only three funds (C, F, and G) and the rules as set by Congress encouraged most people to put most of their money into the super-safe G-fund. For years it took anywhere from two to six weeks to make fund-to-fund transfer. It made day trading tough.

Now the TSP has been liberalized and expanded. New funds (the S and I) were added, along with the Lifecycle L-funds. For a look at how they work, click here.

If there is someone in your office who isn't investing in the TSP (several hundred thousand people fit in to that category,) you may want to send them this column. If they are FERS employees who are not investing, remind them they are refusing a tax-deferred pay raise (the government contribution) of 4 percent.

Postal Buyouts

Our column on rumors-making-the-rounds prompted two readers to say they have heard through the grapevine that the U.S. Postal Service is set to offer buyouts to employees under the CSRS system. Not true says the USPS and the American Postal Workers Union.

Back in the 1990s when the USPS did offer a buyout it turned out to be a disaster. Many skilled employees left and had to be replaced. In effect USPS lured people into retirement (on lifetime pensions) and then had to back-fill their jobs. Bottom line: It is unlikely the USPS will ever again be allowed to offer buyouts. Early retirements, yes. But buyouts: Not likely!

Hawaii has highest millionaire-to-household ratio in the nation

HAWAII has the highest millionaire-to-household ratio in the United States, according to a division of New York-based Phoenix Marketing International.

The winning number, 6.79 percent, might be so high because so many Hawaii households are house-less, but that's another story.

The Phoenix Affluent Marketing Service ranking of U.S. states and the District of Columbia counts the percentage of millionaires in each state.

Hawaii tops the list this year, as it did last year -- and it was at or near the top in the years prior, said David Thompson, vice president and managing director of Phoenix Affluent Marketing.

Some states' rankings , such as California at No. 8, down from No. 6 last year, and New York at 13 this year, down from No. 11 last year, are surprising.

Poor Warren Buffett at Berkshire Hathaway was practically slumming in 2006 with his corporate HQ in Nebraska, which ranked No. 34. It's up to No. 29 this year with a 4.32 percent millionaire-to-household ratio.

Households with greater than $1 million in investable assets are included in the millionaire category, but home values are not included, Thompson said.

Phoenix Affluent included only "highly liquid assets," Thompson said.

"We have a large-scale tracking study that we've been conducting for many years," he said. Using an algorithm to combine its own research, census data and information from Claritas Inc., a California-based marketing research firm, it comes up with the state rankings.

The information "is really just one component of the service we provide," Thompson said. The company also studies "how affluent households behave," from a financial and lifestyle standpoint -- information that is helpful to financial services wanting to market themselves to that elite sector of the population. "We do some business with other players in the luxury space," but its clients are primarily in the financial services and wealth management industries.

Northeastern elite, in their millionaire fantasyland of Cape Cod

"I have to watch my children gasping for air on a bad air day, because somebody gave money to a politician,” environmentalist Robert F. Kennedy, Jr. once told a crowd of supporters, repeating an attack on the Bush administration and coal-fired power plants that he had earlier issued in Rolling Stone magazine.

Among the many “crimes against nature,” RFK, Jr. listed not only his children’s asthma but also that they could not “enjoy the seminal American experience of fishing locally with their dad and eating their catch” due to the mercury contamination of many waters. Obviously, Robert Jr. is a man who takes the environment personally – although it seems the environment he cares most about is his personal property. Despite fossil fuel’s heavy toll on his family – oh, and the fact he says it is destroying the Earth in general – Kennedy is a leading opponent of plans to build America’s first offshore wind farm.

This project is supported by every major environmentalist group in the country. An official environmental impact study on it could not find a single significant negative result. It would generate 75 percent of the electricity needs of Cape Cod and Massachusetts’ islands without producing any of Kennedy’s mercury, or greenhouse gas.

Yet Robert (and the other Kennedys) can’t find anything good to say about the project. Coincidentally, the “Cape Wind” farm location would be just offshore of the Kennedy family’s compound in Hyannis. The turbines thus constitute a major threat to one of America’s “most important” seashores, a seashore owned by the Kennedys and other super-rich vacationers.

Sure, the air would be cleaner, the Earth safer, the children healthier, the water less threatened by another oil spill from tankers headed to the current power plant – but what about the rich folks’ views?

Utilitarian infrastructure is fine for the barbarians of Sulphur, Louisiana or Pasadena, Texas, but the liberal northeastern elite, in their millionaire fantasyland of Cape Cod, are too precious to be asked to see even the slightest dots on the horizon – which is all the windmills would be, since they’d be six miles offshore.

Protecting’ Nantucket Sound from clean energy

To add the illusion of popular support to the obstructionist cause of a few wealthy whiners, Robert Kennedy, his neighbors, and his uncle, Sen. Ted Kennedy, have organized the “Alliance to Protect Nantucket Sound,” a group that in 2004 drew 62 percent of its $4.67 million budget from just 15 donors. Greenpeace calls the alliance “an Orwellian group” of landowners that are only “‘protecting’ Nantucket Sound from clean energy.”

The alliance has a colorful history. Its co-chairman is Bill Koch, a billionaire oil and coal player, who explained his sudden environmentalism thus: ‘’So what? I’m interested in my view and the value of my property on the Cape.’’ An alliance co-founder, Wayne Kurker, is all for Cape development, as long as it expands his marina and defends against giving Hyannis harbor an “industrial look.” Kurker proposes cigarette boat races in the sound and he wants them protected from windmill noise.

Another co-founder, John Donelan, just resigned from the alliance in disgrace after paying the Cape Wind project defamation damages for issuing forged press releases. The group has also distributed fliers showing Cape Wind windmills close to shore and at triple their actual size, created computer images that misrepresent the project, and submitted a petition to the state containing thousands of fake signatures. Robert Kennedy gave the Alliance to Protect Nantucket Sound a “Soundkeeper” award for its work.

But the real work to stop Cape Wind is behind the scenes in Congress, where Sen. Kennedy has devised a series of Cape Wind poison pills. The latest is a deal, apparently cut with Alaskan Republican Don Young, to place a measure into an appropriations bill banning windmills within 1.5 miles of a ferry route. Even the New York Times saw through the ruse and issued a February editorial condemning it.

When it comes to the sacrifices that common folk must make to end our “dependence” on fossil fuel, no hardship is too great. Higher energy prices, increased regulation, and direct taxation are just a start. But when it comes to the spoiled Cape windbags, no hardship is too small that they won’t oppose it with all their money and power. The public waters must be protected as their private playground.

Why millionaire wants a £15,000-a-year job

The official watchdog shredded West Dunbartonshire Council for poor management, and Labour Party headquarters purged its members over recent months.

Now, Labour's answer to its troubles in West Dunbartonshire Council is to put up a member of the exclusive club of Leading Women Enterpreneurs of the World for election on May 3, in the hope that her skills can help turn around the political and social problems in one of the most deprived parts of Scotland.

Ann Rushforth grew up in Haldane, near Balloch, where she is standing for a council seat. She intends to remain in control at the headquar- ters of her business on the banks of the Clyde at Old Kilpatrick, despite the challenge of merging her £11m turnover business with another company.

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But there's a catch. Her business is in one of the more controversial areas of private provision for public services, providing up to 1000 agency nurses per week to hospitals, care homes and prisons.

Labour has previously pledged to stop the use of agency nurses, believing the profits being made by the agencies were a drain on NHS finances.

Mrs Rushforth, a nurse who set up ScotNursing 20 years ago, argues the sector has been much misunderstood.

She has sought to work with the NHS through contracts, providing a route into part-time and flexible work for nurses who would not want to go full-time or into a staff job.

But that has not stopped her opponents claiming a conflict of interest. SNP group leader Craig McLaughlin asked why a multi-millionaire would want to be a £15,000 a year councillor. "Labour is trying to pull in some big guns from outside to salvage its poor reputation in the area," he added.

Mrs Rushforth said she had contracts with most councils in Scotland, adding: "If there was any conflict of interest, I would just step back from having anything to do with a decision."

The 48-year-old mother-of-three, who is married to a rail industry executive, has been a Labour Party member in East Dunbartonshire for more than 10 years. "I've always thought I would like to be more involved in politics," she says. "This is earlier than I'd planned, but because we've had issues in West Dunbartonshire, this was the time to step forward."

That does not extend to parliamentary politics yet: "If people feel what I have to contribute is what they want, that may be something for the future, but for now, my commitment is West Dunbartonshire, and the first thing is to get elected."

Mrs Rushworth denies knowing much about the internal party warfare that saw the West Dunbartonshire group split.

"I was not involved in the detail of what happened, but for a party that can run the country effectively, we must be able to run councils effectively and fairly."

UK millionaire funds construction of home in illegal outpost

British Jewish millionaire Cyril Stein last week flew from London to Israel to attend a house warming party in in Givat Harel, an illegal outpost in the West Bank, Ynetnews reported. Stein, 79, was a guest of honor as he funded the house's construction. Stein does not want to give up his lavish lifestyle to live in the outpost, so a family from Givat Harel purchased the house and the money will be redirected to new construction projects for settlers. It is no secret that rich Diaspora Jews doll out tens of thousands of dollars each year either to purchase homes from Palestinians in east Jerusalem and the West Bank or to fund settler construction projects there.Donors include Yosef Yitzhak Gutnik of Australia and Irvin Moscovich of the US, know for being keen on purchasing homes in east Jerusalem and Hebron. The Yesha council recently launched a campaign aimed at encouraging American Jews to buy West Bank homes in government-approved construction projects.Stein's investment however is risky. The government deems unapproved constructions in settler outposts illegal and his house in Givat Harel may be destroyed should the government go ahead with plans to uproot all illegal outposts in the West Bank. As Stein is unwilling to abandon his posh house in London to live in the outpost, a settler family from Givat Harel purchased the house and the money will be invested in new construction projects for settlers.

Net worth vs. financial assets

Recently there has been some controversy over how to correctly determine a person's status as a millionaire. One of the two most commonly used measurements is net worth, which counts the total value of all property owned by a household minus the household's debts. According to this definition a household owning an $800k home, $50k furnishing, two cars worth $60k, a $60k IRA, $45k in mutual funds and a $325k vacation home with a $250k mortgage, $40k in car loans and $25k in credit card debt, would be worth $1,025,000 and every individual in this household would thus be a millionaire. However, according to the financial assets measurement, equity in one's principal residence is excluded. So are all other fixed assets such as the car and furniture.

While millionaires constitute only a small percentage of the population, they hold vast control over economic resources with the most powerful and prominent individuals usually ranking among them. Forbes and Fortune magazines maintain lists of people based on their net worth and are generally considered authorities on the subject. According to Forbes' latest annual list of the richest people published in 2007 there are 946 US-dollar billionaires in the world. The number of millionaires is much higher.

Multimillionaire

Another commonly used term is multimillionaire. As the term implies, multimillionaire applies to those individuals residing in households with a net worth or wealth of two million or more. Only a small minority of millionaire households are indeed multimillionaire households, yet many of the stereotypical millionaires shown in televisions programs such as "The OC" are actually multimillionaires. The term also has a more prestigious connotation than millionaire.

Roughly 0.9% of high net worth individuals (HNWIs) can also correctly be identified as ultra-high-net-worth individuals (ultra-HNWIs), those who reside in households with a net worth or wealth of 30 million or more. There are approximately 70,000 ultra-HNWIs in the world with 54,000 or 77% residing in the United States and Europe.

Number of millionaires in the world

The "World Wealth Report" is a report on individuals with a net worth of at least $1 million in all assets except their "primary residence". The report is compiled annually by Merrill Lynch and Capgemini.

The 2006 report for the year 2005 tells that "8.7 million people globally each hold more than US$1 million in financial-asset wealth, an increase of 6.5% over 2004."

The number of millionaires grew faster than the number of people in the world in 2005 (1.2%)

Some growth in international wealth and the number of high net worth individuals can be attributed to the weakness of the US dollar, as stated in the report.

• HNWIs (more than $1 million, in 2005)
  • Global: 8.7 million
    • Europe: 2.8
    • North America: 2.9
    • Asia-Pacific: 2.4
    • Latin America: 0.3
    • Middle East: 0.3
    • Africa: 0.1

• Ultra-HNWIs (Ultra-HNWIs Account for 0.9% of All HNWIs) (more than $30 million, in 2003)
  • Global: 70,000
    • North America: 29,000
    • Europe: 25,000
    • Asia-Pacific: 12,000
    • Latin America: 2,000
    • Middle East: 1,000
    • Africa: 1,000

Upscale residences in Honolulu, Hawai'i.

While millionaires are stereotypically said to be upper-class and reside in mansions, many upper-middle class professionals whose net worth is equal to or exceeds one million dollars live in more modest upper-middle class dwellings such as this $600k home in Salinas, CA.

The Sheraton on Waikiki beach in Honolulu, a popular destination among millionaires as well as other upper middle class and middle class tourists.

An extravagant mansion in Carmel, CA. Mansions such as these are exclusive to ultra-high net worth individuals who constitute roughly 0.01% of the population.

All kinds of millionaire

A millionaire is either an individual or any person who resides in a household whose net worth or wealth exceeds one million units of any currency. A multimillionaire has a net worth of more than two million units of currency and a hectomillionaire has a net worth of more than 100 million units of currency, but the technically incorrect centimillionaire is more often used to mean the same thing. While statistics regarding financial assets and net worth are presented by household, the term is also often used to describe only the individual who has amassed the assets as millionaire. Thus the term statistically refers only to households, while in common language use it may only refer to an individual.

Depending on the currency, a certain level of prestige is associated with being a millionaire, which makes that amount of wealth a goal for many. However the status of millionaire is no longer as exclusive as it once was. The increasing number of millionaires is partially due to inflation: a million dollars, for example, provides far less purchasing power today than it did in the 19th century. However it still ensures a comfortable lifestyle for those becoming millionaires.

Get Rich or Die Trying Mentality

Cultivate a get rich or die trying mentality, give yourself no room for retreat or to admit failure. If you focus really hard on something and don't see the possibility of quitting, retreating, or giving up then you will be successfu. It's that get rich or die trying mentality that will really get you up and running in the morning.

After all, if it's your life on the line and you need to make whatever it is you want to accomplish really badly a success, can you do it? Most people give businesses and other things in life a half hearted attempt, and they try but when there's a lot to lose then they do whatever it takes to make it a success. If there is no other way, and failure was not an option, I think you would accomplish a lot more.

If you make getting rich important then you won't put it on the back burner anymore and actually take the action required to make things happen. People are lazy, and there's always things that come up. Schedules can be hectic and time is limited in a day. If something is important enough, you will do it, even if it means staying up an extra hour at night.

When we want something and don't use the do or die trying method, it's not accomplished and there's no results to see. It's sad that we have to force something like that on ourselves to be able to move forward fast but if you're the type of person that needs that, then use it. It's a method and strategy, it works for certain type of people. People that are procrastinators and need more motivation than the average person to get uncomfortable, boring, routine, and necessary steps done in order to see big results.

John Carlton, a famous copywriter said he used the gun to head mentality when he was younger because he needed to be a high paying and well-known copywriter because there was nothing else that he has going for him. You can apply this prinicple and be famous and be the best in your own profession or business.

• Make it "Get rich or die trying" if financial success has been holding you back.
• Or make it "Do or die trying" if it's something you've been putting off.
• Or use the "Gun to Head" life is at stake principle, and work your heart out for a big campaign or project and reap the rewards.

Millionaire Opportunities

Think millionaire opportunities abound! Cease thinking about lack or poverty, it's that trap that keeps most people exactly in the rut where they are right now. We are indeed what we think. Dare to dream big and believe you too can join the ranks of other millionaires one day by utilizing the opportunities that come along and creating your own millionaire opportunities as well. Luck has nothing to do with it. We create our own opportunities and our future!

It's not only about dreaming about what we want, it's about doing whatever it takes to get there. Everyone wants to be a millionaire but not everyone wants to do what it takes to get there, like in any goal.

Millionaire Business Opportunities are everywhere, if you would just look. It could be right in your neighborhood, disguised as real estate deals or a business partner. America is the land of opportunity, people in third world countries think of the U.S. as a land paved with gold. If you are not in the USA you still have many opportunities. Many people would do anything to be able to come here and work hard to become rich. If you live in the U.S. then you're already richer than the 1.7 billion people that live in third world countries and you are surrounded by opportunities everyday. Just keep your eyes open and know that you can become a millionaire if thats truly what you want.

Isnt that awesome? Be thankful for everything. If you have the following things, you are rich beyond compare. Banish any negative thoughts and reverse that negative attitude. Don't think about what you don't have instead think about what you do have and why you should be thankful for having them.

• Your health
• Your Family
• Fresh air and water
• Shelter
• Food
• Money for daily expenses
• Some money in the bank
• A job/career or your own business
• Your children/wife

Take a moment to say a prayer to God (it doesnt matter what religion you are in or whether you are religious or not), and thank him for everything wonderful thats present in your life.

Keep an open mind and heart. Know that there is more than enough in this world for everyone and you will be taken care of and provided for. You need to put your trust in God. Have faith in God and belief in yourself.

"To believe in the things you can see and touch is no belief at all; but to believe in the unseen is a triumph and a blessing." -Lincoln

Now that you have a positive attitude and are ready to embark on a journey to a destination that you choose you will find many tools on this website to help you.

Life is a journey, not a destination.--Unknown.