where do millionaire keep their money

Where do millionaires keep their money? 

While the middle class like to spend their money on homeownership, cars, and vacations, millionaires play a different game.

Just 20% inherited their wealth from family exactly opposite of what plenty of people think of.

It makes important to understand where do millionaires keep their money?

While some wealthy people keep their money in highly liquid assets while others prefer to invest in the stock market, mutual funds, and other investments for millionaires. 

Most prefer to have an emergency fund and even have significant contributions to pension funds. 

8 Assets Where Millionaires Keep Their Money

It will be foolish to make generalizations because different people follow different investment philosophies. However, there are some common ways how millionaires invest their money into the different asset classes.

Cash And Cash Equivalents

Cash and cash equivalents are a type of asset that includes currency such as paper notes and coins etc.

Examples of cash equivalents are demand deposits with banks, certificates of deposit, commercial paper, and money market mutual funds that can be quickly converted into cash.

They are often considered the safest form of investment because they don’t require any effort on behalf of the investor often known as liquid cash equivalents. 

Even some rich people own safe deposit boxes consisting of cash in different currencies. 

Also, millionaires prefer to use a credit card as it gives more protection against fraud and boosts credit score as well.

Ultra-high net worth individuals (UHNWI) prefer to have 20% to 30% of their money in cash and cash equivalents to buy in market downturns. 

Millionaires prefer to keep their money in investment accounts in private banks like JP Morgan Private Bank.

Stocks And Funds 

Stocks are the most preferred investment for millionaires helping them to build a diversified investment portfolio and make the major portion of their retirement accounts.  

Rich people love to invest in the stock market. Even 25% of UHNWI became millionaires through stock market investments.

Even some ultra-rich investors have more than 70% of their portfolio into shares of stock. 

Income from equity securities consists of capital appreciation as well as dividends. 

Some popular types of investment include mutual funds or index funds or investing directly into stocks

Index funds are passively managed investments that invest in all the securities that include in a given index.

They are diversified and can provide lower-cost and tax-efficient methods of investing.

Professional investors like Warren Buffet have a big amount invested in dividend-paying stocks which generate current income. 

Real Estate Investment

Real estate properties are the second most popular investment for millionaires, with almost all of them investing in this real estate. 

Real estates are a great investment for millionaires as it offers stability and passive income as rental income.

At first, millionaires prefer to buy some personal real estate and thereafter diversify their real estate portfolio on commercial properties like office buildings, stadiums, etc.

As a beginner, you can start with REIT (Real Estate Investment Trust) listed on the stock market rather than buying directly from the real estate market. 

It is just like mutual funds in the case of the stocks market and helps you to gain capital appreciation over time. 

These trust payout dividend yields of around 10% and help you generate passive income streams by owning real estate properties and other cash-generating assets. 

Private Equity and Hedge Funds

Unlike public equity which trades on stock exchanges, private equity is not listed on stock exchanges.

Therefore unless you are a rich person there is a fairly lower chance you have invested through private equity. 

Venture capitalists tend to invest in startups to boost their net worth by huge margins. While it comes with the biggest risk, might give 100x of their investment.

Investment via private equity requires a big chunk of money therefore out of the reach of common retail investors. 

Millionaire has a considerable investment in hedge funds to reduce their risk without much affecting the expected returns. 


It includes gold, silver, mineral rights, and several other commodities. They work opposite the stock market.

When the stock market is bullish prices are low compared to normal rates because people tend to transfer their funds from commodities to the stock market and vice-versa.

In one of the interviews, Robert Kiyosaki termed gold as “God’s money” and call them real assets

Also – Commodities may not be the best choice for a lot of investors who look for high returns on investment as in the last 2 years gold has delivered negative returns. 

Gold has delivered an average CAGR of 8.6% in the last 30 years and is often regarded as a True Investment. 

However, in the recent decade, most people transferred their funds from gold, and silver to cryptocurrencies and other digital assets. 


Cryptocurrency is gaining traction in the past few years with over 100K cryptocurrency millionaires.

Not like traditional investors looking for tangible assets, new-age investors are also investing in digital assets. 

The market cap of all cryptocurrencies currently stands at over $1.9 Trillion, with Bitcoin being the largest cryptocurrency by far and accounting for more than 40% of this total value.

18% of ultra-rich people have their fortune in cryptocurrency. And 11% have been invested in NFTs. 

Others invest in Cryptocurrency because they believe it is a good investment opportunity, expecting the value of these tokens to continue to increase over time.

Cryptocurrencies are a relatively new asset class and come with a lot of risks.

Before investing in them, make sure you understand how they work and what could happen if the value of a particular cryptocurrency decreases.


Millionaires tend to have a learning attitude therefore they invest in themselves. 

Roy T. Bennett wrote in his book The Light in the heart – “There is no more profitable investment than investing in yourself“.

A book for $20 has the potential to make a living for you.

If you think you will get your financial knowledge when the money comes then that time will never come. Because wealth is created out of financial knowledge.

Today, If you separate the wealth of Warren Buffet from him it would not affect him. On the other hand the very next day, he will become a millionaire.

He can easily get a job as a fund manager because of his knowledge.

He can also become a hedge fund or portfolio manager of billion-dollar and charge 0.1% as a commission he will become a millionaire.

Around 70% of lottery winners lose their winning amount within 10 years even one-third of them declare bankruptcy.

It is due to the lack of financial knowledge.

I am not saying that you will become a millionaire overnight but your chances are high if you have the right attitude and gain financial knowledge by investing in yourself.

Alternative Investments

Rich people invest in alternative investments like fine arts, and paintings, and in the new era, they are owning NFTs

Multi-millionaires tend to own intellectual property rights to songs, movies, and paintings, and these investments are also termed lucrative investments

Fine arts and paintings help them to gain tax benefits.

Fine arts and painting are sometimes not considered legitimate investment options in eyes of value investors. 


Making a general perception about rich people makes no sense even if it is for millionaires.

Investment philosophies differ from person to person, one rich person prefers to stay in a private equity fund over generating more passive income streams. 

The one thing that remains common is to set aside a considerable amount of money in cash. You should build your portfolio according to your appetite for risk.

One of the major reasons for their huge wealth is excellent diversification which reduces the level of complexity as well. 

Frequently asked questions (FAQs)

How do millionaires insure their money?

Generally, millionaires do not have a normal bank account as they open them with private banks which offer them FDIC insurance of $250K. 

Even some banks make it up to $2 Million by diversifying their funds into different banks.

How do millionaires live off interest?

It seems difficult to live off the interest in recent times how the interest rates on investment instruments have declined and most probably most millionaires don’t. 

Living on interest will depreciate the money millionaires have and this is not what millionaires are known for. 

Most millionaires live off on dividends from stocks, private equity funds, or becoming silent partners in a partnership. 

Where does millionaire hold their cash?

Most millionaires prefer to keep their hard cash in private banks like JP Morgan Pvt Bank and also keep considerable funds in investment accounts. 

Millionaires prefer to open accounts with a private banker offering personalized customer service, and assets management, including services of financial advisers.

What do Bank millionaires use?

According to Euromoney Private Banking and Wealth Management Survey and ranking by Global Finance, J.P. Morgan Private Bank is the best private bank for US-based HNW individuals.

Also, we have prepared a list of top banks millionaires use for asset management purposes which major companies are Citibank, JP Morgan, etc. 

How do wealthy people protect their money?

Mainly there are the risks associated with money –

  • Inflation,
  • Tax, and
  • Economic Instability

Wealthy people invest their money to protect it from inflation in different investment instruments like the stock market, cryptocurrencies, and bonds.

To protect their money from tax purposes they use legal entities created under different laws under the name of trust and own stakes in the ownership of that trust.

They also invest in stable investments like gold, and silver to protect their money from economic instability.

What is the safest place to keep the money?

Private Banks are often regarded as the safest places to keep the money. In terms of investment, fixed investment instruments like gold bonds or government bonds are the ones that most millionaires prefer. 

Can I put a million dollars into the bank?

Yes, you can put a million dollars into a bank on your wish. 

However, it is not advisable to keep a big pile of cash in your savings accounts as FDIC insurance will give you insurance up to $250K. 

Some banks also use cash management accounts to spread out the risk by bank partnership and distribute the risk associated to multiple banks to protect more than $250K insurance.

In the end, it’s your wish how much net worth you want to keep in your Bank account. 

How much do millionaires keep in the bank?

It depends from person to person and a lot of other factors. In the case of the market, boom millionaires try to redeem their investments at higher valuations to balance out their portfolio and therefore have more cash and vice-versa. 

In general, most millionaires tend to keep 20% to 30% of their money in cash and cash equivalents.

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