Millionaires are ostentatious. They live a glamorous life, with private jets and luxury cars, hidden away in enormous mansions in the exclusive Hollywood hills.

Or is that all fantasy? The truth is far from the bling and bright lights. Most millionaires in America actually live what most people would call a normal lifestyle. What’s more interesting, though, is that living modestly is what made them millionaires in the first place.

This post shows you that if you’re dedicated and clever enough to plan your finances correctly, you too can follow the path to riches that many a millionaire has walked before you.

Many millionaires don’t live the high life. They budget wisely to maintain their affluence.

If you were a millionaire, you wouldn’t hesitate to wear Prada and drink Champagne every day for breakfast, right? But despite the stereotypes, many actual millionaires purchase fewer expensive items than you do – and they are happy doing so.

If you want to become a millionaire, you’ve got to learn to save responsibly at the moment when you first start to earn more money than you need to live on.

The majority of self-made millionaires have modest backgrounds and achieved great wealth by saving their monthly earnings and avoiding spending cash on stuff they didn’t need. This simple rule is one way you too could become a millionaire, without ever actually making a million dollars a year.

People become millionaires by controlling their budget and maintaining their affluence in the same way. They’re also practiced at thinking long term and planning for the future.

A survey of millionaires found that for every 100 millionaires who weren't budgeting and thinking about their financial future, there were 120 millionaires who certainly were.

Planning and structuring expenses is key if you want to become a millionaire. To start, set a goal, such as having a certain amount of cash tucked away for retirement. Then budget your expenses, living costs and investments.

Mrs. and Mr. Rule are millionaires, and their main goal is to be financially independent when they’re ready to retire. By this time, they want to have saved some $5 million.

To make this happen, the couple cleverly allocates their time and money so that they can continue to invest in their business while earning and saving money that can be used toward real estate purchases or home renovation projects.

True millionaires believe financial independence is more important than flashy social status.

Many real-life millionaires are more interested in financial independence than owning a fleet of Rolls-Royce luxury cars.

Financial independence plays an important role in well-being. Of those in the same income bracket, people who are financially independent are happier than those who aren't.

But what does it mean to be financially independent? If you are able to continue the lifestyle you maintain now when you retire, and are able to survive a future financial crisis, then you are financially independent.  

Financially secure people are clear about future goals, which enables them to organize household budgets according to personal priorities.

Let’s revisit the Rule family again. Mrs. Rule is happy and financially secure. Even if she suffers a physical injury, she will never be financially dependent on anyone. She’s even in the position to put funds aside for her grandchildren, whom she hopes will graduate college one day.

Many people can picture the prototypical American millionaire, the big-hat-no-cattle type – that is, a person who looks like a rich rancher but doesn’t actually own any cattle. They drive luxury cars but earn average incomes. And even if they earn a decent income, they struggle to accumulate wealth.

In other words, these millionaires don’t have as much money as you’d expect. To calculate the expected wealth of a person, use this equation: the person’s age multiplied by the pre-tax annual household income, divided by ten.

For example, Mr. Friend earned $221,000 one year. Since Mr. Friend is 48 years old, his expected wealth would be 48 multiplied by 221,000, then divided by ten, which equals $1,060,800.

But by squandering his cash on luxury goods, Mr. Friend’s actual net worth is less than $260,000. He’s no millionaire! In fact, he’s a big-hat-no-cattle guy, also known as an under-accumulator of wealth. Simply put, he’s not worth as much as he could be.

Millionaires know where and how to spend their cash. Invest in what you know!

How do millionaires choose what to invest in? Clever millionaires know that dishing out on medical care for their family and investing in methods to make a business more productive is the way to go.

Although these millionaires are often frugal in other respects, price is not an issue when it comes to buying investment services, getting tax advice or spending on medical care for themselves and their loved ones.

Likewise, they know to buy products or services that improve their businesses, such as additional office space or computer software.

Take millionaire Mr. South. He says he would never buy a Rolls Royce for himself, because in his lower-middle-class neighborhood, it would turn too many heads. Instead, he understands that using his money to pay for his grandchildren’s dental care makes far more financial sense.

Smart spending also means smart planning. Millionaires spend a greater amount of time planning investments and often reap more benefits from them than those who neglect to plan.

Moreover, if you want to increase your wealth by investing in specific businesses, you’ll need to plan as well as get some expertise. Everyone has at least one area in which they have considerable knowledge, so use this to your advantage when investing.

For example, Mrs. Smith is an auctioneer who specializes in commercial real estate. Which industry should she invest in? Commercial real estate, of course.

Mr. Long however knows a lot about antique furniture. Should he invest in high-tech securities? Probably not, as he should stick to what he knows best.

The typical millionaire isn’t all Hollywood glitz and glamour. Many live well below their means, saving and budgeting money diligently and spending it intelligently. If you consistently adhere to these simple standards, you too could become a millionaire.

 Action plan: Cash looks better in your bank account than on your body! Next time you receive a bonus or get a raise, resist the urge to splash out on some flashy new gadget or trendy piece of clothing. Save the money and enjoy watching it grow in your bank account.