54 out of 54 people found this review helpful.
Who Wants to be a Millionaire?
Date of Review: Dec 12, 2000
Have you ever been curious about the lives of the wealthy? Do you wonder what they buy, how they live, and what their secret to success is? If so, then "The Millionaire Next Door" will give you the answers that you're looking for. This book was co-written by two college professors, Thomas Stanley and William Danko, who have studied the lives of the affluent for many years. Their cumulative research is included in this text.
Basic Contents:
This book drives home a few key point about who is rich in America, how they got there, and what keeps them in their affluent status. The primary reasons are:
1.They live below their means.
2.They allocate their money, free time, and energy to wealth accumulation.
3.They prefer achieving financial independence over displaying/flaunting their social status.
4.Their parents did not give them free and frequent handouts of money.
5.Their children usually become self- sufficient.
6.They are skilled in targeting business opportunities
7.They carefully select an occupation that complements their skills and talents and leads to building wealth.
Of all these points, the one that the authors stress more than anything is the first point. People must live below their means, if they have any hope of achieving financial independence. This doesn't mean that you must live far below your means; but you must live below your means, at least a little, in order to have any money left over to invest.
The profile of the typical millionaire contains some characteristics that are obvious. For example, most of them are homeowners; have household incomes over $100,000; own their own businesses; and are male, between the ages of 50 and 60. However, other characteristics are not so obvious. For instance, 80% of millionaires are self- made. Only 20% inherited the wealth. Most of them do not live in multi- million dollar homes, or drive expensive cars worth over $50,000. A typical millionaire lives in a nice home, but not an extravagant one. The average value of a millionaires home is between $300,000 and $400,000. Millionaires usually live in a frugal manner. After all, that's what got them where they are today. They are willing to give up a little status to have more investments and financial security.
What's Wrong With This Text:
This book does have some interesting facts to read, but it fails to provide any financial advice. When I first heard about this book, judging by its title, I though it was going to be a book that explained, in detail, how some of these rich people got where they are today. It doesn't give any advice at all. It's just a listing of profile information on rich people.
The three appendices at the end of the reading are not very useful. The first appendix explains how the authors found these millionaires, to conduct their research. Appendix #2 shows the cost of vehicles, ranked in cost per pound. And the third, and silliest appendix, shows a list of occupations that millionaires typically hold. Basically, it's just a listing of almost every known occupation (nearly 300 are listed), so I'm not sure what the point is of having this as an appendix.
Closing Thoughts:
This is a quick, easy, read, full of some good trivia about rich people, and a few eye- opening statistics. There are approx. 30 tables listed throughout the book, to illustrate the facts. But this book is not much help if your goal is to find out how to build wealth and how to reach your goal of financial independence. Still, if you disregard the lack of advice, it is a halfway decent book to read. The facts are entertaining and thought- provoking, if nothing else.
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