Debunked: 3 Lies About How the Wealthy Really Live

When you picture a wealthy American, what comes to mind? Many people picture the wealthy as those who live in palatial mansions, drive exotic sports cars and luxury sedans, and flash their "black cards" when they pay for things.

Nothing could be further from the truth. In most outwardly visible ways, the typical millionaire doesn't really act like a millionaire. Here's a look at three lies about the wealthy you should stop believing.

1. Millionaires own mansions

It shouldn't be a surprise that most millionaires own the homes they live in. In fact, 90% of them own their primary residence, and in many cases, the equity they've built in their homes is a big reason why they are millionaires.

However, don't think the typical millionaire's home looks like the mansions you've probably seen associated with wealthy people on TV. According to Ramsey Solutions' National Study of Millionaires, 6 out of 10 live in homes worth less than $500,000.

There's a good reason for this. Despite what you might have been told by your real estate agent, your primary home is not an investment. It's certainly an asset, and for many people, owning a home can be preferable to renting. But it's not likely to produce returns like the stock market or rental properties can over time.

2. Millionaires buy expensive cars

When you hear the words "millionaire" and "car," you probably think of brands like BMW or Cadillac. So, you might be surprised to learn that you're more likely to find millionaires driving Toyotas and Fords than either of these. The most popular vehicle among high-income households in the United States is the Ford F-150.

Simply put, vehicles are depreciating assets. And millionaires tend to get (and stay) wealthy by focusing their financial resources on assets that are likely to go up in value over time. That's why more than 85% of people who drive luxury auto brands are not actually millionaires.

3. Millionaires carry balances on fancy credit cards

There are several high-end credit card products that are marketed toward wealthy Americans, and others that are simply designed to make the cardholder look wealthy. The Centurion Card by American Express is the most glaring example, as the "black card" is well known for being used by celebrities and the ultra-wealthy.

However, you might be surprised how debt-adverse millionaires are, especially when it comes to credit cards. Overall, 56% of active U.S. credit card accounts have a balance. But nearly three-fourths of millionaires have never carried a credit card balance.

Credit cards can certainly be a valuable financial tool that allows you to build your credit score, earn rewards, and gain financial flexibility. But only if you're paying the balance in full each month -- not paying 20% or more in interest.

The key takeaways

Some of the most pervasive myths about how the wealthy live have to do with spending money. On the other hand, the way you get to be a millionaire or multi-millionaire is to accumulate money, not spend it. And that's what these three truths about millionaires show us.