Save and Invest

7 money mistakes millionaires like Warren Buffett and Bill Gates never, ever make—that average people do all the time

Bill Gates
Adam Galica | CNBC

There are two things we know for certain about millionaires: They know exactly where their money is going, and they know exactly what not to do with it.

If you want to reach millionaire status, the single most important thing you can do is to learn from the likes of the super wealthy, from Microsoft co-founder Bill Gates to Google's ex-CEO Eric Schmidt to Berkshire Hathaway CEO Warren Buffett.

Here are seven things you'll never find the world's richest people doing, and how you can adopt their healthy financial habits into your own life:

1. They don't waste money on fees

Rich people know that fees are a waste of time (and money, of course), so the right course of action is to pay their bills on time. They take advantage of features like autopay to avoid late charges for everything from utilities to mortgage to credit card bills.

They're also mindful of bank fees. Many banks will charge you extra money for their services, and you might not even be aware of it.Some of the bigger banks, for example, will charge you anywhere from $12 to $15 unless you meet a specific set of requirements, like maintaining a certain average balance in your account. Make it a habit to check your monthly statements for these hidden charges.

2. They don't ignore their credit score

Your credit score plays a leading role in determining your interest rates. A high credit score can earn you a low interest rate and save you thousands of dollars in interest over the life of a loan. A low score may prevent you from getting a loan if you ever need one.

Wealthy people know this and they never, ever ignore their credit score. They are constantly checking their score and do their best to keep it pristine. There are a number of apps that allow you to check your score for free and even try to help you boost it. Monitor your score reports on a monthly basis, keep your debt levels low and pay your bills on time.

Watch 33-year old Bill Gates explain his hiring process, why he moved Microsoft to the Seattle area
Watch 33-year old Bill Gates explain his hiring process

3. They don't spend impulsively

We see millionaires drop a ton of cash on ridiculous things all the time (i.e. Cardi B's $500,000 Lamborghini), but the smart ones are surprisingly frugal. Bill Gates wears a $10 watch. Warren Buffett eats the same thing for breakfast at McDonald's every day — and it never costs more than $3.17. Mark Zuckerberg drives a manual transmission Volkswagen.

"Rich people don't get rich by spending it all. They know better than anyone that by being careful shoppers they can achieve a lifestyle several rungs up the income ladder," notes market researcher Pam Danziger. Impulse spending leads to waste, overspending and debt — three things successful people avoid.

4. They don't fall for marketing ploys

Marketing plots are everywhere, and rich people avoid falling for them by comparison shopping. They appreciate value, but they also look at the big picture and always weigh the benefits of quality versus cost.

To adopt the same habit, do your research and consider your bottom line before making a purchase, big or small. By purchasing a more expensive yet well-made item that you'll use for years, you can save yourself the time and money of having to repair or replace a poorly made item.

5. They don't try to beat the market

Billionaire and former Google CEO Eric Schmidt says that short-term trading (a.k.a. buying or selling stocks based on daily market movements) won't make you rich. He always thinks long-term and never tries to beat the market.

Warren Buffett also insists on using the long-term strategy. A few days after he released Berkshire Hathaway's annual letter to shareholders earlier this year, the billionaire appeared on television at CNBC and explained why longer-term investment strategies like index funds still stands the test of time.

6. They don't have just one source of income

Having multiple streams of income will help you to generate more money, and rich people never rely on just one source of income. Consider turning your spare car into a ride-sharing business, taking on freelance work, becoming a tutor or writing about areas of expertise.

"When I got 'The Tonight Show,' I always made sure I did 150 [comedy show] gigs a year so I never had to touch the principal," comedian and television host Jay Leno told CNBC. "I've never touched a dime of my 'Tonight Show' money. Ever. I always had two incomes. I'd bank one and I'd spend one."

7. They don't keep up with the Joneses

According to a 2017 report by employment website CareerBuilder, 78 percent of American workers live paycheck to paycheck. Wealthy people know that the idea of well-lived life is subjective. Buffett never owned an iPhone until he received one as a gift, but "I'm not using it," he told CNBC.

Your friends, neighbors or co-workers might have the latest "must-have" tech gadget, but that doesn't mean you need one, too. There's a solid chance the Joneses can't actually afford their lifestyle. Your personal reality is more important than public perception. Decide what you want your life to look like now — and in the future. Don't let anyone else make that decision for you.

Elle Kaplan is the founder and CEO of LexION Capital, a fiduciary wealth management firm in New York City serving high-net-worth individuals. She is also the chief investment officer and founder of LexION Alpha.

Like this story? Subscribe to CNBC Make It on YouTube!

Don't miss:

Rapper Wyclef Jean's money confessions
Rapper Wyclef Jean's money confessions