Fed wealth data, Stanley's millionaire surveys and Buffett's own letters reveal which rich habits are real, and which viral ones fall apart.
This in-depth guide covers everything you need to know about habits of rich people: what the data actually shows. Based on verified income data and real-world case studies from our database of 138 side hustle tactics.
The habits of rich people that show up in real data are mostly about money and work: they own stocks and businesses instead of relying on a paycheck, they spend well below what they could, they read a great deal and they turn down most of what they are offered. Federal Reserve data shows the ownership habit in hard numbers, and Thomas Stanley's millionaire surveys describe the spending habit. The famous "rich habits" lists and the "5-hour rule" are a lot weaker than they sound, and we will show you why.
This post sticks to habits you can observe and check. How the wealthy think about money lives in our millionaire mindset post, and hour-by-hour schedules live in billionaire morning routines.
The habits, ranked by how good the evidence is
| Habit | Who it comes from | Evidence quality | What copying it costs you |
|---|
| Owning stocks and businesses | Federal Reserve wealth data | Strong: national data, updated every quarter | A low-cost index fund, any amount you choose |
| Spending well below income | Stanley and Danko's millionaire surveys (1996) | Decent but dated: large surveys of actual millionaires | Free, and it saves you money |
| Reading a lot, mostly nonfiction | Buffett, Munger, Gates in their own words | Good as description, weak as cause | $0 with a library app |
| The "5-hour rule" | Michael Simmons, a writer, 2017 | Weak: his own pattern spotting | One hour a day |
| Saying no to most things | Buffett's shareholder letters, Steve Jobs | Good as description, hard to measure | Free |
| Tom Corley's "rich habits" lists | One self-run survey of 361 people | Weak | Read with caution |
Which of these do you already do, even a little?
What Federal Reserve data says about how rich people hold money
The best window into the money habits of the rich is the Federal Reserve's Distributional Financial Accounts, which split all US household wealth by wealth group every quarter. We downloaded the full data file (latest quarter: 2026 Q2, updated September 2026) and worked out where each group keeps its assets.
| Wealth group | Stocks and mutual funds, share of their assets | Private businesses | Real estate | Pensions and retirement plans |
|---|
| Top 1% | About 53% | About 14% | About 11% | About 5% |
| 50th to 90th percentile | About 12% | About 4% | About 37% | About 26% |
| Bottom 50% | About 4% | About 2% | About 47% | About 13% |
Source: our calculation from the Fed's DFA data, 2026 Q2. "Private businesses" is the Fed's "unincorporated businesses" line, which also includes rental property owned for income.
Roughly two thirds of what the top 1% owns is pieces of companies, public and private. The middle class mostly owns a house and a retirement account. The bottom half mostly owns a house, if anything. The same data shows the top 1% hold about 51% of all the corporate equities and mutual fund shares owned by US households, while the bottom half holds 0.6%.
The Fed's triennial Survey of Consumer Finances, last published for 2022, tells the same story from another angle:
- 95% of families in the top tenth by income held stock (directly or through funds and retirement accounts), compared with 34% of families in the bottom half.
- "Nearly half of families in the top decile of the usual income distribution owned a privately held business," compared with 20% of all families.
- Median family net worth was $192,900, while the mean was $1,063,700. The gap between those two numbers is the wealthy pulling the average up.
- To reach the 90th percentile of net worth in 2022, a family needed about $1,938,000.
So the first, most measurable habit of rich people is ownership. Where does most of your net worth sit right now: in things that earn, or in things you live in?
Habit one: they own things, and their income follows
A salary pays you for your hours. Ownership pays you from a business or a market, and it can grow while you sleep. That idea runs through our post on why a salary alone won't make you rich, and the Fed numbers back it.
The 2022 Survey of Consumer Finances also measured what happens to business owners as their businesses grow. In its business ownership box, the Fed reports that "a family's income and wealth increased with the number of employees in their business":
| Business size | Median business assets | Mean business assets |
|---|
| No employees | $0 | $142,700 |
| Two to five employees | $141,000 | $959,400 |
| More than five employees | $400,000 | $3,834,700 |
Source: Federal Reserve SCF report, 2022 dollars.
Look at the first row. The typical one-person business owns almost nothing a buyer would pay for. Value appears when the business runs on other people's work. That is the jump from freelancer to owner, and it is why we keep coming back to it in be your own boss and active vs passive income.
Thomas Stanley and William Danko found the same pattern in the 1990s. In the opening chapter of The Millionaire Next Door (1996), they report that about two thirds of the working millionaires they surveyed were self-employed, even though self-employed people made up less than 20 percent of American workers. Many of the businesses were plain ones: welding contractors, auctioneers, rice farmers, pest controllers, paving contractors.
Two honest caveats. Owning a business is risky, and the people who answer millionaire surveys are the ones whose businesses worked. And many of the very richest get there through company stock that keeps growing, which also lets them borrow against it instead of selling, a structure we explain in buy, borrow, die.
Habit two: they spend well below what they could
Stanley's best-known finding is that most millionaires live more modestly than people expect. His opening chapter contrasts a trust officer who wears a $5,000 watch with what the surveys found:
- Most of the millionaires had never spent even a tenth of that on a watch.
- Most were not driving the current year's model of car.
- Only a minority had ever leased a car.
- Their median household income was $131,000, while the average was $247,000, pulled up by the 13% earning $500,000 or more.
Stanley also tells the story of a Texan who ran a successful diesel engine business, drove a ten-year-old car, lived among postal clerks and firemen, and summed himself up this way: "I don't own big hats, but I have a lot of cattle."
How old is this data? The surveys date from the 1990s and prices have changed since. The core habit, a gap between what you earn and what you spend that goes into owned assets, is the same one the Fed data shows from the other end. How spending differs between inherited and earned wealth is the subject of old money vs new money.
If someone looked at your car and your watch, would they guess your net worth too high or too low?
Habit three: they read, mostly about how the world works
Reading is a habit several famous investors describe in their own words.
Warren Buffett and the 500 pages. In 2000, Buffett spoke to Todd Combs and 165 other students in a Columbia Business School investing class. Asked how to prepare for an investing career, he reached toward a stack of manuals and papers and said, as CNBC reported in 2018: "Read 500 pages like this every day. That's how knowledge works. It builds up, like compound interest. All of you can do it, but I guarantee not many of you will do it." Combs took it literally, sometimes reading up to 1,000 pages a day, and later became one of Berkshire Hathaway's investment managers.
Notice what was in the stack: the raw material of an investor's job.
Charlie Munger on Buffett. In Berkshire's 2014 shareholder letter, Munger described the few jobs Buffett kept for himself as chairman in the system he designed, including: "His first priority would be reservation of much time for quiet reading and thinking, particularly that which might advance his determined learning, no matter how old he became."
Buffett's own book picks. In his 2013 shareholder letter, Buffett wrote that he bought Benjamin Graham's The Intelligent Investor in 1949 and that "my financial life changed with that purchase." He added: "Of all the investments I ever made, buying Ben's book was the best (except for my purchase of two marriage licenses)." In the 2014 letter he told investors to read Jack Bogle's The Little Book of Common Sense Investing, and in the 2016 letter he wrote: "The best book I read last year was Shoe Dog, by Nike's Phil Knight."
Bill Gates. Gates publishes his reading on GatesNotes. His summer 2026 list includes Bruce Holsinger's novel Culpability, Andrew Ross Sorkin's 1929 and an audiobook, Gray Matters by Theodore Schwartz, about which he writes: "I have become a huge fan of audiobooks in recent years." His most famous recommendation came from Buffett. "Not long after I first met Warren Buffett back in 1991, I asked him to recommend his favorite book about business," Gates wrote in 2014, as The Christian Science Monitor reported. Buffett lent him John Brooks's Business Adventures, which Gates said "remains the best business book I've ever read," adding: "And Warren, if you're reading this, I still have your copy."
Books billionaires read and recommend, with sources
| Book | Who recommended it | Where they said it |
|---|
| The Intelligent Investor, Benjamin Graham | Warren Buffett | 2013 Berkshire letter |
| The Little Book of Common Sense Investing, Jack Bogle | Warren Buffett | 2014 Berkshire letter |
| Shoe Dog, Phil Knight | Warren Buffett | 2016 Berkshire letter |
| Business Adventures, John Brooks | Buffett to Gates, 1991 | Gates, via The Christian Science Monitor, 2014 |
| 1929, Andrew Ross Sorkin | Bill Gates | GatesNotes summer list, 2026 |
| Culpability, Bruce Holsinger | Bill Gates | GatesNotes summer list, 2026 |
Five of those six are about money, business or markets. If you only had time for one book this month, which would it be?
Does reading make people rich? Nobody has run that experiment. Rich people also have more free time, more education and jobs where reading is the work itself. What the quotes do show is that the people who built these fortunes treated reading as part of their job.
The 5-hour rule: where it came from
You have probably seen the "5-hour rule" in a headline: successful people spend at least an hour a day, five hours a week, learning.
The phrase belongs to Michael Simmons, an entrepreneur and writer. His article first ran on Medium and was republished by CNBC in May 2017 under the title "Bill Gates, Warren Buffett and Oprah all use the 5-hour rule." In it, Simmons writes that many leaders "set aside at least an hour a day (or five hours a week) over their entire career for activities that could be classified as deliberate practice or learning. I call this phenomenon the 5-hour rule." He splits the hour into reading, reflection and experiments, and he lists claims such as Buffett spending "five to six hours per day reading five newspapers and 500 pages of corporate reports" and Gates reading "50 books per year."
Simmons is upfront about his method: "What I've done does not qualify as an academic study, but it does reveal a surprising pattern." The rule is one writer's reading of public profiles, and the label is his.
Simmons also cites Benjamin Franklin, and Franklin is the better source. Franklin's own Autobiography describes a library that "afforded me the means of improvement by constant study, for which I set apart an hour or two each day." His famous daily schedule gives the 5 to 7 a.m. block to "Contrive day's business, and take the resolution of the day; prosecute the present study, and breakfast," and the noon hour to "Read, or overlook my accounts, and dine." So the original version came from a printer who taught himself in the gaps of a working day.
Where would one hour come from in your week? The American Time Use Survey for 2025 found that watching TV took 2.6 hours a day on average, half of the 5.2 hours of daily leisure. Most people already have the hour. It is going somewhere else.
Habit four: they say no to most things
Buffett has written about it for decades in investing terms. In his 1996 shareholder letter he told ordinary investors: "You don't have to be an expert on every company, or even many. You only have to be able to evaluate companies within your circle of competence. The size of that circle is not very important; knowing its boundaries, however, is vital." In the 2013 letter he said of himself and Munger: "It's vital, however, that we recognize the perimeter of our 'circle of competence' and stay well inside of it."
Steve Jobs said it about products. Answering developers at Apple's 1997 Worldwide Developers Conference, including one about Apple dropping its OpenDoc software, he said, according to this transcript: "Focusing is about saying no."
A warning about a quote you will see everywhere: "The difference between successful people and really successful people is that really successful people say no to almost everything," credited to Buffett. We could not find it in any of his letters, a dated interview or a transcript, so we treat it as unconfirmed. The circle of competence passages above are the documented version of the same idea.
What would you drop this month if you held every commitment to Buffett's test: is it inside my circle?
The weak study everyone cites: Tom Corley's "Rich Habits"
Search for the habits of rich people and you will meet Tom Corley, an accountant and financial planner whose book Change Your Habits, Change Your Life and survey numbers get repeated by major outlets.
Here is the design, as CNBC described it in 2017: Corley "surveyed 233 wealthy individuals, mostly self-made millionaires, on their daily habits" and compared the answers with 128 lower-earning people with less than $35,000 in annual gross income. Business Insider, republished by Entrepreneur in 2014, gave his definitions: rich meant an annual income of $160,000 or more and a liquid net worth of $3.2 million or more; poor meant income of $35,000 or less and liquid net worth of $5,000 or less. One of the most quoted results: "88 percent of Corley's wealthy respondents say they devote 30 minutes or more each day to education or self-improvement through reading."
Why we treat this as weak evidence:
- Small, with unclear selection. 361 people is a tiny sample for claims about everyone, and we found no description of how participants were chosen or any sign of a random sample.
- Self-reported. People describe their own habits, and most of us flatter ourselves on reading and exercise.
- Cause runs both ways. Someone with $3.2 million in liquid assets has more free time to read and exercise. The habits may follow the money as much as they lead to it.
- No losers in the rich group. Plenty of people read every day and stay broke. A design that only interviews winners cannot see them.
- Peer review. We found no peer-reviewed paper behind the figures, only books and articles.
Corley's advice may still be good. His numbers cannot prove those habits made anyone rich. When you see "rich people do X, poor people do Y" with a precise percentage, ask: who was surveyed, and how?
Rich habit claims that do not hold up
- "Copy these habits and you will get rich." No study shows that. The Fed and Stanley data describe what wealthy households own and spend, with no controlled test behind them.
- The 5-hour rule as science. It is a useful nudge from a writer who says himself his work is no academic study.
- 500 pages a day for everyone. Buffett's advice was aimed at future professional investors and pointed at the material of their job. For most readers, a steady habit you keep beats a heroic target you drop.
- Precise "rich vs poor" percentages from small surveys. Treat them as interesting anecdotes.
- Expensive lookalike habits. Watches, new luxury cars and leases are what Stanley's millionaires mostly skipped. Diets, supplements and health spending get their own posts, such as what billionaires eat.
What it costs to copy, at a glance
| Habit | Their version | Your version | Rough cost, as of 2026 |
|---|
| Ownership | Stock and private business stakes | Automatic monthly purchase of a broad, low-fee index fund; see index investing | Whatever you choose to invest; compare each fund's expense ratio and pick a low one |
| Spending below income | A modest car and watch on a big income | Keep your next car longer, skip the lease | $0, and it frees money to invest |
| Reading | 500 pages, book lists, audiobooks | One hour a day, five days a week | $0 through Libby, which says thousands of public libraries offer ebooks and audiobooks free |
| Saying no | A strict circle of competence | Write down the three things you know best | $0 |
Buffett's own advice for regular investors is short. In the 1996 letter he wrote that "most investors, both institutional and individual, will find that the best way to own common stocks is through an index fund that charges minimal fees." In the 2013 letter he described his advice to the trustee of cash he will leave behind: "Put 10% of the cash in short-term government bonds and 90% in a very low-cost S&P 500 index fund." Treat this as general information. Your own mix depends on your age, debts and goals, and a fee-only adviser can help.
Your habit plan this week
Pick two or three of these for the next seven days.
- Find your hour. Look at your phone's screen time report or your TV evenings and move one hour, five days this week, to reading or learning. Franklin used the early morning; you can use a lunch break or the commute with an audiobook.
- Borrow one book. Get a library card if you need one, install Libby and borrow one title from the table above.
- Check your mix. Write down roughly what you own: home equity, retirement accounts, stocks, a business. Compare it with the Fed table. Is any of your net worth in things that earn?
- Set up one automatic purchase. Even a small monthly amount into a broad index fund starts the ownership habit. If you want a plan for the money to invest, our how to get rich guide walks through the order of steps.
- Draw your circle. List the three subjects or skills you know better than most people. Next time an offer, a tip or a side project lands in your inbox, ask whether it sits inside that circle. If it doesn't, say no.
- Skip one status purchase. Delay the watch, the upgrade or the new car by a month and see if you still want it.
Which one will you do first, and when exactly will you do it?
The pattern is simple and slow. The wealthy households in the Fed's data own things, Stanley's millionaires spent less than they could, and the investors who built the biggest fortunes read for decades and turned down most of what came their way. Each habit is free or close to free to start. What it asks of you is time.