The Millionaire Next Door : The Surprising Secrets Of Americas Wealthy Reviews

• A Book Whose Time Has Come--wisdom long OVERDUE!

  
  By on 1998-09-05
  I used to be one of those people who spent all or at least most of my money and thought I was doing okay with the little savings I had in the bank earning 2% (wow).I always bought brand new cars, new clothes, went on vacations 6-8 times per year and partied. I had a great time! One day my company shut down and I was forced to live on 50% OF MY INCOME. My savings dwindled to nothing and I had a hard time making car and credit card payments. I came to the realization that I was "renting" my "lifestyle" all of which was encumbered with debts and false belief in "job security" A friend loaned me a copy of "The Millionaire Next Door" and I had to painfully admit that I had been a fool. I met a really nice old couple in their '70's who never made much over minimum wage in salary, but were debt free and had 100's of thousands to retire on and were living better than the flamboyant fools like me who spent through their incomes. This book turned me around. I would also recommend "9 Steps to Financial Freedom" and 'More Wealth without Risk" to add to your library, or at least borrow from a library. I am now living better, earning 20-25% in mutuals, contribute to my new companies 401 (k), have a IRA and am DEBT FREE with the exception of my mortgage which will be paid off in five years (or less).
  
  

• There is no level of income you can't outspend.

  
  By A1Q0BX9CEKIY1I on 1999-08-05
  I just finished rereading MillionaireNext Door for the third time, it's a great book, must reading for everyone and anyone serious about their financial future. I have also read some of the reviews. It seems that some people have confused the term "frugality" with "cheap". But I'll bet all of those detractors of this book are also paycheck to paycheck and deep in hock. Yes they may show all of the trappings of wealth; high profile job, beautiful house, 2-3 cars, beautiful clothes and jewerly etc., etc.But what is their net worth???? A key phrase is that there is no level of income that you can't outspend. You may make a million dollars per yearand live a beautiful lifestyle, but if you're spending 125% of your income, guess what, you're still BROKE! Along with Millionaire next door, I also suggest, particularly to the naysayers, "You earned it, don't lose it" "More Wealth without Risk" and "Financial Self DeFense" Money is somewhat like health. Many people just don't understand it's valueuntill it's too late!
  
  

• Excellent-this book is must reading for everyone!

  
  By on 1998-06-04
  Every now and thena very, very special book comes along with a "aha" and this is such a book. Many people are spending their way through high incomes---keeping up with the "JONE'S" high profile lifestyle's encumbered with high debt and zero savings. I worked for a millonaire one time who said"Money buys clothes, clothes don't buy anything!" He advised us to buy our "toys" clothes, cars, vacations etc. off profits of profits and never spend principal! This mans nt worth was well in excess of $350,000,000. I would also recommend three other books; "RICHEST MAN IN BABLYON" by George Clawson, "WEALTH WITHOUT RISK" and "FINANCIAL SELF-DEFENSE" by Charles Givens. Remember, it's not what you make, it's what's left over that counts. If you spend all of your money on your lifestyle, guess what? You'll always have to! Good reading, excellent book.
  
  

• A startling revelation on what it takes to create wealth.

  
  By on 2003-11-04
  I can certaintly understand the controversy regarding this book. When I first heard of this book, I thought it was some ripoff book and approached this book with ambivalence. So I checked it out from my local library first and was so impressed that not only did I go out and buy my own copy, but also give it as an accessory gift for special occasions and recommend it to everyone I know.

  I also recommend "The Millionaire Mind" which is different from this book. That volume allows you to peek inside the minds of millionaires; shows you how the millionaires think.

  One caveat of these books is that they are dependent on income. You won't find anything in here on creating cash flow. For that I recommend "Rich Dad Poor Dad" whose ideas on staying debt free are somewhat similiar to what is recommended in Millionaire Next Door, but also provides ideas for creating wealth through additional cash flow. It is a book that should be written in addition, not in place of The Millionaire Next Door.

  Also recommend More Wealth Without Risk and Financial Self-Defense which offer actual strategies on creating wealth, reducing expenses and investing.
  
  

• Sensational!

  
  By on 1999-07-08
  The people givin this book one stars and whining miss the point. You can have a lifestyle while building for the future. Nowhere does it say you have to live like a hermit. Frugality is the key. I'll bet that all of the one stars are also livig paycheck to paycheck and broke (but having a great time) I also recommend Buffetology and More Wealth without Risk.
  
  
• A FANTASTIC BOOK!
  By on 1998-09-21
  I look at this book as a modern version of the timeless classic "The Richest Man in Bablyon" Frugality and Delayed Gratification are difficult disciplines which is probably why so few people, irregardless of their incomes, have any real wealth! For anyone interested in actual action techniques, I highly recommend 'Wealth without Risk" and "Financial Self Defense" by Charles Givens. also "7 Strategies for Wealth and Happiness" by E. James Rohn.
  
  
• Sensational!
  By on 1999-07-08
  The people giving this book one stars and whining miss the point. You can have a lifestyle while building for the future. Nowhere does it say you have to live like a hermit. Frugality is the key. I'll bet that all of the one stars are also living paycheck to paycheck and broke (but having a great time) Am I right??? I also recommend Buffetology and More Wealth without Risk. All three are excellent books and must reading for anyone seeking financial succe$$!
  
  
• This is how the rich become rich
  By on 2004-01-30
  Creating wealth is sort of like dieting.Everybody wants the end result but the discipline to achieve that result is usually lacking.Oh, if only there were a magic pill that you could take to lose weight or to create wealth without changing your habits. We would all be rich.FRUGALITY...FRUGALITY...FRUGALITY. It takes discipline.Contrary to certain opinions i.e. revews posted here, you don't need "a wad" to do this.However, by following these concepts, you will soon have a wad.There is no level of income that you can't outspend and yet most of us feel that we have an unlimited supply of cash.You would think that considering the ever increasing number of bankruptcies and mortgage foreclosures not to mention company downsizings that people would have learned by now. Peer pressure...keeping up with the Jone's drives many people to live beyond their means. Remember this: when your outgo exceeds your income, your upkeep will become your downfall.DELAY GRATIFICATION. Pay yourself first. Invest and then buy toys with the profits.Another good book to read is Rich Dad Poor Dad and Cash Flow Quadrant. Robert . Kiyosaki has a different strategy than Stanley and Danko in certain areas but is in agreement in other areas. The authors work compliments each other and I highly recommend these books to all would be financial achievers.Another book that is popular right now and says some of the same things is The Automatic Millionaire by David Bach.Read and grow rich.
  
  
• The way to wealth
  By on 2004-01-31
  MAKE NO MISTAKE ABOUT IT...Nobody has ever achieved any level of wealth without exercising some degree of discipline. Discipline to create cash flow and discipline to plug up the leaks on excessive spending.

  The Millionaire Next Door shows how average people achieved extraodinary wealth with a few daily disciplines. When most people think of wealthy people most people look at the type of cars they drive, homes they live in, fancy clothes and other materialistic things.

  The fact of the matter is, that in many cases, these people have the least amount of wealth. There bankers, brokers, realtors, store clerks, insurance agents are getting wealthy while they slave away in some cases working two jobs in an effort to show a lavish lifestyle.

  The Millionaire Next Door shows that you don't need a huge income to become wealthy. Nor do you have to live like a hermit. You can have a great lifestyle in the present while saving for the future...but you have to exercise control.

  The Millionaire Next Door was like a jolt of electricity to me and made me aware that I was living way beyond my means with little if anything put away for retirement or even emergencies.

  By contrast, I know some people who earn far less than I do, live reasonably well and have also saved a small fortune by being frugal.

  Do you really need that bottled water? Eat out every day. Rent too many videos. Have to buy those new fashions? Need to buy a new car just to keep in style? Need to move into that bigger house to keep up with your neighbors?

  Here is a tip: increase your spending starting tomorrow by putting at le ast 10% of your gross income away. Invest into a IRA and your 401 (k) plan at work. If you are doing that, great. Increase your spending by increasing the amount of money you put into investments. Make extra principal payments on your mortgage and credit cards. Spend extra money in rental properties...carefully or start a small home based business and then use the profits to enhance your lifestyle.

  Besides The Millionaire Next Door, I also recommend The Millionaire Mind, Rich Dad Poor Dad, The Automatic Millionaire, The Truth About Money, Ordinary People Extraordinary Wealth and More Wealth Without Risk.

  If you have high credit card debt, I recommend Rich Dad's Guide To Becoming Rich Without Cutting Up Your Credit Cards by Robert Kiyosaki. By the way, Kiyosaki recommends The Millionaire Next Door in his excellent book Rich Dad Poor Dad.

  The Millionaire Next Door is a great read, just don't make it your only source of financial information.

  Another way to spend money profitably is to spend (invest) in education by buying good quality books like the ones mentioned above.
  
  

• An excellent work that will add to your wealth
  By on 2004-02-14
  Fans of 1,000 page frivilous financial books written by magazine authors or social science books written by "Nixonites" will probably not appreciate this great work by Stanley and Danko.

  On the other hand, people who want to learn how to become wealthy, financially free and possibly even a millionaire on the other hand, will enjoy this book.

  Saying that just cutting back is all this book is about is like saying just exercise and diet and don't read any exercise or nutrition books.

  The Millionaire Next Door is an excellent book. Obviously it bothers some people and that is great. I always go with the guys that run with the ball, people like Stanley and Danko.
  
  

• Wake up "one stars"!
  By on 2000-01-07
  After reading several of the reviews of this book, it seems to be divided into love it or hate it. There seems to be a misconception among the "one stars" that your average millionaire is an unhappy, penny pinching miser who never enjoys their wealth. The word FRUGAL is used an awful lot as it CHEAP. I must tell you from experience that as the stereo typical person that is discussed in the book, that I cannot be happier living a middleclass lifestyle. My friends, neighbors and even family (aside from my wife) don't have an idea how much money is being amassed. I don't want to hang out at the country club showing off to a bunch of four flushers who are up to their eyeballs in mortgages and credit card debt. Getting up in the morning and knowing that there is no mortgage on the house, every bill is paid IN FULL and on time, is the most wonderful feeling in the world. It is a lot better than buying a $5,000 watch that will be used only to impress someone in a $1200 suit. Sorry One Stars, I do take great family vacations, go to dinner a few times a month and mow my own lawn. I do not deprive myself of anything I really want. I just don't want the latest things that are being pedeled on TV. Buying this at full price would only make a sucker out of me. There are things you need, and things you want, and it's OK to treat yourself but you must keep a strong grip on what you are buying and why you are buying it. I have used a rather strange baromiter over the years to aquire wealth. I try to have $10,000 dollars to invest by the time I finish a new tube of tooth paste. It works for me except when my son squeezes half the tube down the drain. Boy do I have to work hard that month! I am 40 years old and have a net worth of $4,000,000. I will remain happy if I can keep my secret from my friends. I don't think that I would be accepted in my middle class world if they knew. This book is common sense to some, and a complete and foolish mystery to others. If the one stars don't smarten up, they will remain one stars for the rest of their lives. Buy this book and read it as many times as it takes for you to get it, otherwise you will have no choice in your later years but to live like a miser.
  
  
• One of the four great "must read and do as they say" books
  By on 1998-02-21
  If your desire is early retirement and/or to assure your every comfort in your senior years, a vast many of the life lessons provided in this book must be considered. This is one of the four great "must read, must do" books of our time.* Don't be so critical that your only concern is with how some of the subjects in this book choose to not spend their wealth later on in life - that's their decision. Once you've attained wealth for yourself, you can then decide what to do with it. The point is, you've got to get it first, and this book is a fine example of how the common people can achieve amazing wealth over time. As a former shoe shine and paper boy, high school dropout and infantry private in Vietnam, I went on to earn an MBA and in the process became a self-made PAW. I'm now enjoying early retirement at age 50. I do what I choose - no boss to answer to. I was still able to pick up pointers from this book that I implemented to achieve even greater wealth. *-The three other greats being "Buffettology" by Mary Buffett, "More Wealth Without Risk" by Charles Givens, and "The Truth About Money" by Ric Edelman. PS - Gallo wines and Budweiser or Michelob is just fine for this PAW. The UAWs can serve the expensive imported stuff.
  
  
• Can you spot the Millionaire Next Door to you???
  By on 2004-03-12
  Before buying The Millionaire Next Door you may have some questions. I had some too like:

  Who are the rich in this country?

  What do they do?

  Where do they shop?

  What do they drive?

  How do they invest?

  Where did their ancestors come from?

  How did they get rich?

  Can I ever become one of them?

  In The Millionaire Next Door you will get the answers to these questions and more. This is the book that is changing peoples lives---and increasing their net worth. It sure has helped me and will help you as well.

  Pick up The Millionaire Next Door and read the never before told story about wealth in America.
  
  

• A wonderful guidebook for those seeking financial FREEDOM
  By on 1999-07-08
  I'm frugal, yet this book excited me so much that I bought a pile of them and gave them to many close friends with strong urgings to read. The second time this has ever happened to me. This book presents a realistic method for becoming financially independent. The key element is saving 15% of your pre-tax income, and investing that for the long term. What a small price to pay for true financial freedom! A core idea implied here is changing the typical American "order of operation". By sacrificing some spending now, one can then have plenty of toys and goodies later, if that is important. Or do whatever you want - free of a ball-and-chain job. An unexpected bonus was a look into the (counter-intuitive) effects of parents giving substantial sums of money to adult children. Hint - it usually makes them worse off financially in the long run. They also had some excellent data on thinking about your investments in AFTER-tax terms. This was before index funds became the rage, and I hadn't thought enough about this. Simple, practical advice that helped me seek out better alternatives, and therefore a more lucrative long term strategy. What I really liked about this book was that it presented the "live an honest, frugal, and hardworking life" in a practical context - that of reaping the substantial reward of financial freedom. For so many of these people, the independence they had gained, and the personal pride and contentment in that freedom made them so happy, it's hard to imagine any amount of consumer goods providing that. Life, liberty, and the pursuit of happiness...hmmm - sound familiar? For me it was a great motivator. While I'm much younger than the typical late 50ish to early 60ish millioniare interviwed, it showed me that I'm well on track if I just keep at it. That has REALLY helped for the past several years. If you're looking for a quick fix or magic bullet, or you can't stand the idea of giving up some of your pretax income for now - to have a much better financial life down the road, then this book isn't for you. However, if you are willing to consider some spending moderation, and are looking for practical advice that will truly work - this book is definitely for you. ***ANYONE*** with a moderate (say $30K and up) income, plus some desire and self discipline can become truly self sufficient financially - let freedom ring! I think that's truly wonderful, and this book can set you on that path.
  
  
• Very interesting analysis
  By on 2004-03-07
  I found it interesting that according to this great thesis by Stanley and Danko, a full 5% of all the Millionaires created their wealth in sales.

  The study futher states that those millionaires made their money in sales, became very good at selling, earned an excellent living and saved and invested a substantial part of their income. As a result, became millionaires.

  The last part is where most people go wrong. They spend all of their income; they spend first and never set up an investment plan.

  Read and apply the principles in The Millionaire Next Door. Consider making selling your profession. Make a committment to become excellent and save/invest a substantial portion of your income.

  There is no level of income that you can't outspend.
  
  

• Very worthwhile read
  By on 2004-03-12
  The Millionaire Next Door is without doubt one of the best financial books ever published. It tells you exactly how millionaires became millionaires.

  Unfortunetly, achieving wealth requires discipline. Too many people would rather live for today and forget about tomorrow. Too many people think that success is a college degree and keeping up with the Jones's. The higher their income, the higher their lifestyle.

  Interesting that small business owners were so successful and that the most successful were normally mundane businesses. I read that the #1 producer of millionaires in small business was via dry cleaning. And you thought it was technology!

  The Millionaire Next Door is a powerful book that can positively change your life. Some others include Rich Dad Poor Dad, The Automatic Millionaire and More Wealth Without Risk.
  
  

• Scrooged!
  By A2HII4U9WQ0XUV on 2006-11-05
  The sub-header to this book could very well be: "All Work & no Play makes Jack a Dull Boy".
  
  Basically, Tom Stanley's scholarly treatise on American wealth comes down to this mind-ripping, continent-blasting conclusion:
  
  Millionaires, you see:
  
  1) Save more than they spend;
  
  2) Don't spend anything.
  
  That's it. Page after page, chart after chart, graph after graph, anecdote piling up on anecdote, all of it boiling down to the same conclusion: don't spend more than you save. Clip coupons. Hang on to your wife `til Death you do Part. Buy a rambler for 80 grand, and cling to it like a rat clutching a Big Mac in a hurricane.
  
  To wit: if you're a good little Bob Cratchit, and burrow down in your suburban Dacha, drive the Civic, eat Top Ramen, and take your vacations at the State Museum of Knitting & the Fine Arts, you'll die loaded!Sound like fun?
  
  Didn't think so. Look: you've got one life, and after death all bets are off. Sure, you could be hauled up by the angels to Paradise, or it could just be one plate of linguini too many, a nasty flatline and one vast inky void of non-consciousness. Either way, you're looking at one single trip on this not-so-flat Earth, so you might as well live large.
  
  It's true, now: you can haul in major bank in whatever profession you choose: eremetic horror-writer, Wall Street tycoon, Railroad baron, small-town librarian, legal eagle defender of the Criminally Insane, whatever. And you can always outspend it. That is the source of endless tragedy and Dickensian woe throughout the ages, without a doubt.
  
  But there pitfalls at the other extreme. Listen: I live next door to one of these McMillionaires. The guy is this enfeebled little wizened gnome of a critter, used to be a bank Vice President and got bought out because he was a dingus. Total skinflint. Miser. Goes on his own hunting trips and brings back venison, deer meat, which he forces his family of---jesus, I think 12---to eat for months. Lives in a shacky little rambler, buys used Crown Vics from the local police department and bargain basement prices.
  
  The guy, no doubt, is high net worth. But he's also a loser.
  
  This is a guy who didn't want to cough up a few hundred bucks to help build a joint fence between our properties---so there's a fence, even a fence that abuts his property---but beyond my house and demesne, he elected not to build a fence. Instead, he got a plastic Jersey Barricade (orange and white) and went with that. Is that any way to live? Is that really what it means to be a `millionaire'?
  
  I think not. Half the glory of the Age of Great American Consumption is buying stuff you don't need, but want. Desire. Demand. What else is work for? Find a way to creative bliss, work at something you're good at, that you have a real passion for, and the money will follow.
  
  But for the Love of God, it's only Money: spend it! What is money for, if not to indulge yourself?
  
  Sure, get a pace---plan to the end---set a budget. But how many of you want to be that newspaper column on page A3, the 95 year old dowager pauper who begged for alms on the streetcorner, ate catfood out of a tin, and scrounged for quarters by the bus stop, then was found rigid and cold in the urine-stiff sheets of her dirty bed, sprawled atop a fortune estimated at 20 million bucks? Sound like a plan? I think not. Money may not buy happiness, but it sure as hell can get you a Rolls-Royce Phantom.
  
  "Millionaire Next Door" might have it right in its sociology---and for what it is, Stanley's thesis is meticulously researched, mustered like a well-trained army, and capable of marshalling its teeming forest of facts like a well-drilled martinet---but it's off the map when it comes down to the point of the whole thing: if you've got it, flaunt it.
  
  "Millionaire Next Door" isn't a bad book: it's scholarly, and plods along its own hand-me-down lodestar towards its prophesied conclusion (be cheap! Die loaded!), and perhaps some folks will be astounded to discover there are some real richies down the block who in another day would have been called skinflints.
  
  But as a map to your stars, this one is a little cramped, cribbed, dank, and stinks of mothballs. I think I'll take first class---scratch that, how much did you say that Learjet was going for, again?
  
  JSG
  
  
• Inspiring
  By A1BN9LZB9575P3 on 2000-07-12
  While this book is not a how to become a millionaire guide, by looking at the habits of first generation millionaires, it makes it seem within one's grasp. My wife and I have been inspired to achieve millionaire status in 10 years after reading it! It should be noted that The Millionaire Next Door is geared mainly to people who earn above average incomes and spend their money on fancy clothes, expensive cars and other conspicuous consumption items and never really accumulate wealth. If you are in this category, this book will make you think about your spending habits and whether or not you are willing to forego spending now in order to build up your nest egg and lead a comfortable retirement.

  There is a lot of emphasis on frugality in this book. However, if you are a low income single parent in a minimum wage job, frugality is choosing store brand over name brand in the supermarket. There is no money left over to invest in stocks and real estate because just about everything is being spent on the bare necessities. Perhaps Stanley and Danko should write another book profiling people who came from dirt poor backgrounds and achieved financial independence. That would really be inspiring.
  
  

• Defintely a worthwhile read
  By on 2004-03-13
  The Millionaire Next Door is an awesome book to show you the way to wealth and financial freedom.

  Great book--highly recommended.
  
  

• A Good Read
  By on 1999-12-30
  The Millionaire Next Door by Thomas J. Stanley and William Danko is a fun to read book for anyone interested in understanding America's wealthy, defined by Stanley and Danko as those people who have net worth of $1 million dollars or more.

  The Millionaire Next Door claims that there are seven key factors that lead to wealth accumulation. Included are: 1. Living Well Below your financial means. In other words being frugal. Buying the reliable used car versus the shinny new BMW or Porsche.

  2. Spending your time wisely and in ways that lead to building wealth, such as studying investment. 3. Being more concerned about financial independence rather than showing off how much wealth you possess.

  This is a book that will make you feel good about yourself if you are a compulsive coupon clipper or if you keep telling your kids to shut the door as they are letting the heat out of the house and it is costing you money. The book claims that it will teach you how to join the ranks of America's millionaires. Who could resist reading such a book?

  To get rich, you must first learn not to be a hyperconsumer. In other words don't buy a lot of expensive stuff you don't need. You need good "offense" or generating earnings of at least $60,000 or more a year. Then you need good "defense" or saving a goodly portion of what you earn. Then you need to get old.

  In fact, even if you don't have a million dollars, you can still be "rich" by being a PAW. PAWs or "Prodigious Accumulators of Wealth" have more money than you would think they would based upon their age and income. In contrast are the wasteful UAWs or "Under Accumulators of Wealth." There are also AAWs (Average Accumulators of Wealth) but they aren't discussed much. No mention is made of how much EWOKS tend to accumulate. But, I'm betting those furry little fellows save a lot.

  So even athletes worth tens of millions of dollars can be UAWs. There is something reassuring in that! There is a lot of interesting knowledge to be gleamed from this book. We learn that 3.5 of every 100 households in America have a net worth of $1 million dollars or more. But that 22 of every 100 households headed by Russians have a net worth over $1 million dollars.

  We also learn that self-employed people account for over 2/3 of the wealthy in America. But Stanley and Danko do not tell everyone to start their own business. That's too risky, the authors say. In later chapters they do mention some businesses that they believe are poised for growth in the future. Businesses that cater to millionaires.

  Danko and Stanley seem to see a glimpse of successful businesses when they suggest starting professional businesses. Such businesses tend to need to generate less revenue to make an equivalent level of profits. But this is equivalent to starting a business with high net margins. Many non-professional businesses also have relatively high profit margins. Many college drop outs have built computer-programming based companies, for example.

  Despite having studied wealth for decades, and holding PhD's, Stanley and Danko seem to have some misunderstanding about the nature of wealth building via entrepreneurship. It is pointed out that many corporate businesses fail to report profits in any given 12 month period. No allowance is made for businesses like amazon.com which are growing rapidly and establishing themselves. The implied message seems to be that running a business is just too risky. And, it is pointed out that many businesses demand considerable resources like land for coal mining. But, before this the authors are toting investing in assets that appreciate. Land is one of those assets.

  We are told that one key factor of the rich is that they minimize their tax bite. The rich tend to pay a much smaller percentage of their overall wealth in taxes than most people. But, here it seems Stanley and Danko are mixing up cause and effect. Yes, the rich think about taxes. But, it is precisely because they have already saved a lot, and have retained wealth that is not taxed, that they pay a smaller percentage of their wealth in taxes.

  But Stanley and Danko can be excused for any oversight as they hold PhD's and "being well educated has certain drawbacks" with regard to the creation of wealth.

  The flaw of pursuing spending to show you are affluent and have financial status is very thoroughly trashed, as it rightfully should be. All successful people tend to be achievement oriented. But, I think the book could do a better job of following up upon the fact that 2/3 of America's wealthy are small business owners. It seems an injustice to just sweepingly say that likelihood of success in business is tenuous, and imply you should get a professional degree so that you have high earnings to save. Maybe this is what some business owners tell their children, but it is not how they acquired their wealth. To really understand wealth creation, you need to understand business, and I feel Stanley and Danko could do a better job expanding upon this.

  Finally, there is some very interesting food for thought about how wealth will affect your children. I like this book a lot and recommend it. Peter Hupalo, author of Thinking Like An Entrepreneur.
  
  

• Most people have it all wrong on how you become wealthy
  By A185B1S2XBQXUK on 2000-01-03
  Most people have it all wrong about how you become wealthy, according to the author-researchers of The Millionaire Next Door. Their 20-year study of how people become wealthy involved focus groups and personal interviews and accompanying statistical tables on where they shop, cars they drive, and the daily work they do. I found the statistical tables of mild interest, but insights into their views and beliefs were surprising and revealing. The target group studied have net worths of one to ten-million dollars.

  The majority acquired their wealth in one generation and followed these factors of wealth accumulation: *Live well below your means. *Spend your time, energy and money efficiently in ways that build wealth. *Believe that financial independence is more important than social status *Their parents didn't help. *Their adult children are economically seW-sufficient. *They know how to pick market opportunities. .They chose the right occupation.

  As a group, they all have supreme confidence in their own ability. If you thought ancestry had much to do with it consider this: The highest concen-trations of millionaires by ancestry in order of rank are Russians; Scotts; Hungarians; Latvians; Australians; Egyptians. Self-employment is a major correlate of wealth.

  They are frugal and their spouses even more so. Not only are they planners and budgeters, they don't shop where you might think; their two favorite stores are J. C. Penny and Sears. Most answer these questions the right way: -Does your household operate on an annual budget? -Do you know how much your family spends each year for food, clothing, shelter? -Do you have a clear, defined set of daily, weekly, monthly, annual and lifetime goals? -Do you spe'd a lot of time planning your financial future? -Do you niinnnize your taxable income and maximize your other income? While nearly all own stocks, they don't follow the ups and downs of the market. They firmly believe the more intellect, time and energy you spend hiring a financial adviser, the more likely you will be to find a successful one. They use CPAS to not only do taxes, but also to provide investment advice and they usually choose one with the most millionaire clients. They believe it is easier to earn a lot of money than it is to accumulate wealth.

  A couple of charters are devoted to their relationships with their children. They believe the more dollars they give to adult children, the fewer dollars these children accumulate (a statistically proved relationship). Here are the rules they more or less live by in dealing with their offspring: -Never tell your kids you are wealthy. -Teach your children discipline and frugality. -Minimize discussion on what your kids will inherit. -Never give cash or significant gifts as part of a negotiation. -Stay out of your adult children's' family matters. -Emphasize their achievements.. .not your success. -Assure them many things are more valuable than money. Millionaires encourage their children to become seW-employed professionals such as doctors, attorneys, engineers, architects, accountants and dentists. They believe only a small number of professional people fail to make a profit any given year and they earn more than the average for small businesses. "You can lose your business, but not your intellect," they say. Most own their own business because they believe self-employment is less risky than working for another.

  Well worth reading. You can learn a lot about how to accumulate wealth.
  
  

• I'd read this book first, ahead of the others
  By on 2004-03-28
  What it all comes down to is frugality and money management. Stanley and Danko beat that point to death in this great treatise on how to create wealth.

  Also, keep in t his mind that The Millionaire Next Door was based on actual research done on actual millionaires. It is not a book written by some magazine writer/book author who arites books that nobody wants to buy or read...with good reason--her advice doesn;t work.

  The Millionaire Next Door is based on advice that really does work. Has worked and will work for you as well...if you apply it.

  Don't read the negative reviews based on jealousy on these two great authors, read the book and profit.
  
  

• Extensive research by Stanley & Danko
  By on 2004-04-25
  I can understand and appreciate that everyone wants to state their opinion on this book, but I really thought or would think that people would read it first and then review it.

  When I read reviews like the one by a reviewer that says "Poorly Researched" I have to scratch my head and wonder why these people even bother coming to these boards.

  Geesh!
  
  

• A million ways to say the same thing
  By AABDRCKWKPI34 on 2000-03-20
  The content of this book would fit on a single page. The authors (I can't believe it took 2 monkeys to churn out this garbage) simply chose to repeat that 1 page about 250 times. I gave up after they told me for the 100th time (page 100) that the key to becoming wealthy is living well below your means. The authors' examples refer to only 2 types of Americans: their typical PAW (Prodigious Accumulator of Wealth), who has ammassed a great deal of wealth by living in a tin shed, eating smack-ramen, and driving a 1982 Ford Escort, and the typical UAW (Under Accumulator of Wealth) who makes $100K/year, lives in a beach-front house, spends $100/day on fine dining, and leases a brand new Mercedes every year. How about some middle ground? Sure, both types exist, but apparently the authors' extensive research didn't gleen that fact that a vast majority of Americans are somewhere between these 2 types.

  As far as solid financial reasoning and advice are concerned - forget it. This book has neither. And some of their formulas - the UAW/PAW indicator in particular - simply do not work for people in their 20's and early 30's. Of course they don't bother to tell the reader that, but then again, they probably don't realize that themselves.

  Actually, I think the real key to becoming wealthy is writing a terrible book, and then suckering a million or so people into buying it. Sorry to say I was one of them. Hope I can save you from the same.

  This book should come with a free hat, or at least a full refund if you can read the whole thing.
  
  

• Recommended only for yuppies.
  By A38C0W886SR09R on 2005-04-18
  This book gives the reader some good food for thought regarding the benefits of living below one's means and the differences between wealth and materials, but it turns out to be unrealistic. The authors suggest not spending more than twice your income on your home, but in my area - and many others - that is just not possible for the great majority of people. They also continuously discuss the success of small business owners in building wealth, but downplay the fact that most small business owners don't succeed with their businesses. There is also lots of "filler" material relating to the mathematics of wealth that is just unnecessary and overly drawn out. What is the point of calculating the price of a car by the pound? That certainly isn't the best measure of a cars value and is much less important than safety, reliability, economy, utility and performance. If you are a doctor, lawyer, or a business owner that likes to spend more money than you make this might be a good eye opener, but this book isn't targeted at the average person and I just didn't find it to be useful.
  
  
• Interesting and informative - but be careful!
  By on 2001-11-27
  Let us get one thing out of the way. This is NOT a bad book. In fact, it is a well-done, interesting, and much needed study that gives us all new insights about what millionaires are really like as opposed to people's misconceptions of them. If this was merely a study of what millionaires are like, I would give it five stars.

  The problem begins when people see this book as a recommendation: "most millionaires are frugal, hard-working, well-educated, and diligent investors - so if I will act like that I will be a millionaire". This is simply not true - and for a very simple reason discussed below.

  Indeed, most millionaires ARE like that. Indeed, it is good advice to be frugal, hard-working, and well-educated as opposed to the opposite. It is also gratifying to see that sometimes "doing the right thing", the protestant work ethic, and the "nose to the grindstone" attitude sometimes pay off not only in "being a better person", but in concrete monetary success. Apparently good guys DON'T finish last after all.

  But the book suffers from a double survivorship bias. "Survivoship bias" is what happens when one only pays attention to those who survive a certain activity, peril, or risk, and makes ungounded conclusions about cause and effect from that. One famous example is Neitzsche's famous saying, "what doesn't kill me makes me stronger". It is based on the survivorship bias that those who survive terrible calamities tend to be stronger than other people. But it doesn't mean the calamity MADE them stronger - it might mean simply that only those who were strong to begin with survived the calamity.

  What survivorship bias do we see here? First, it interviews ONLY millionaires. It doesn't interview ALL of those who are frugal, hard-working, and concerned about education - it only interviews those of them WHO BECAME MILLIONAIRES. It could very will be (it probably is) that 99% of those who are hard-working, frugal, and concerned about education still fail to become millionaires.

  This, of course, doesn't mean that being hard-working and educated is "bad"; it just doesn't mean that it is the CAUSE of becoming a millionaire. If anything, only the opposite that is true: that if you are lazy, a big spender, and a cropout, you probably will NOT become a millionaire. But that is NOT that same thing!

  A second survivorship bias is the time of the survey. The people interviewed were, almost to a man, "dilligent investors" - especially in the stock market - who started investing at least 20 years before. They were interviewed in the late 1990. This means that, by sheer coincidence, they started investing in what turned out to be the largest bull market in US history. On the average, $1 invested in the stock market in 1980 would be worth about $20 when the Dow hit its high in 1999. Naturally, this significantly increased the net worth of many of these people. But was this due to any foresight on their part, or sheer luck? If the stock market had gone the other way, how many of them would still be millionaires?

  Furthermore, what about all the hard-working, diligent investors who started investing at the same time (early 1980s)... but unluckily invested in the wrong companies or industries, such as the "safe" oil or car industry which tanked, ruining many people? How could you tell - BEFORE it happened - that one investing method was better than the other, that one will make you a millionaire and the other leave you broke? You coudln't.

  Once again, this doesn't mean that investing is "bad". It is NECESSARY to invest well and succeed in your investments in order to become a millionaire - if you don't invest, you won't become a millionaire. But again, this isn't the same thing: you might very well invest with all due dilligence, safety, and careful planning - and still lose everything.

  In summary, good book? Yes. Interesting book? Yes. Teaches you things you didn't know? Yes. Shows that the old protestant work ethics is good after all? Yes. But does it show you how to become a millioniare? NO! Buy it, by all means... follow its advice... but do so because it is generally good advice on how to live, NOT because it will make you rich. That is just an illusion based on survivorship bias.
  
  

• Save Money, Become Wealthy, Burn This Book for Heat.
  By A3SMN4GQEQBCJ5 on 2001-12-30
  I received this book as gift, and after reading it, I am glad I didn't spend any money on it. This book is a classic example of taking a few simple concepts and restating them in every imaginable form to reach a decent book length. The useful information could be summed up into a small pamphlet.

  Subject matter:
  The basic premise of the book is how the average Joe and average millionaire may not be too terribly different. The author interviewed hundreds of millionaires and then analyzed the data from the interviews. They repeatedly comment about how "Mr. penny-pinching trailer park owner is far better off with $1.5 million in the bank than Mr. Doctor with a great house and lifestyle, who only has $750,000 saved up."

  The authors constantly rant about how being incredibly frugal and watching every penny spent will make you wealthy. While this may be true, none of the information presented ventures far beyond common sense.

  Another tactic, which I found very annoying, was that various charts and data tables were listed multiple times but in varying ways. For instance a whole page may be taken up by a table dedicated to whether or not millionaires worry about things like cancer, their children's financial future, and the stock market. Three pages later, the same table may be listed, but with percentages rather than raw data scores. There are many instances where the same information is presented in what appears to be nothing more than an attempt to lengthen the book. I found myself wanting to pound my head against the wall.

  I would not recommend this book to anyone looking to make good use of his or her time. I kept reading only in hopes that there would actually be a few pearls of knowledge to be gained. In the end, I wish I had put the book down shortly after reading the great discussion about millionaires and their ancestry. I truly could care less that there is a larger proportion of millionaires from Scottish descent than from Algerian roots. How is this helpful to me??

  Don't waste your time reading this book in hopes that you'll come out of it with a great insight into financial well being. It just won't happen. This book seems more like a doctoral thesis gone commercial than a truly useful guide to financial security.

  Thanks for your time...
  
  

• The popularity of this book confuses me.
  By AWS18YTE49ZKZ on 2002-07-12
  I was given this book as a gift and was thoroughly disappointed. This book simply states that you should live below your means, stay out of debt and save money, if you want to be a millionaire. Shocking! The statistical data shows that most millionaires don't live in fancy houses, drive fancy cars, belong to country clubs or eat out a lot. True. Most millionaires are people nearing retirement with large 401(k)s/pensions and houses that have appreciated significantly in value. In order to take advantage of this savings, they'll need to sell their homes and begin to liquidate their 401(k)s. In other words, they will be living off this money as retirees. They will not be dining on caviar and champagne every night nor living on a $500,000 yacht. They will need every dime in this high priced world. In other words, they will not be rich . . . and let's face it, people are buying this book because they want to know how to "get rich" not how to have a safe retirement. I suppose a better title for this book should have been: "A safe retirement is within reach for someone with fiscal discipline". Boring and obvious advice.
  
  
• Yes, You Too can Be a Millionaire if you live like a Pauper
  By A1J4VHICAMQJL1 on 2004-09-24
  Great. These people have money, but what else? Do you really want to sit around with a fat bank account while you live and work like a pauper? Personally, I find these people to be hopelessly boring - constantly watching every damn penny and obsessed with their "net worth".
  
  I'm a doctor, and I see people die all the time. And they don't take anything with them except perhaps regrets for what was left undone. No one has ever told me that they wished they had worked just a little more...
  
  I'd rather use up my money and enjoy life rather than having the cold comfort of being a "millionaire".
  
  
• Frugality, Frugality, Frugality, Frugality
  By on 2004-07-01
  I am continually amazed when people think that all of their money problems will be solved with more money. But when they get that "more money" what do they do with it? They spend it! Or as they say; "I spend my money on my lifestyle!" And these are the people who are behind on their car note, still paying rent and have credit card debt up the cazoo. And they are probably the same people giving this great book 1 stars.

  Get a clue! If you keep spending all of your money on your lifestyle, guess what? You'll always have to. And you'll always be broke as well.
  
  

• Rich Dad, Poor Dad: What the Rich Teach Their Kids About Money--That the Poor and Middle Class Do Not!
• The Richest Man in Babylon
• The Millionaire Mind
• How to Win Friends & Influence People
• Cashflow Quadrant: Rich Dad's Guide to Financial Freedom