They allocate their time, energy and money efficiently, in ways conducive to building wealth.For example, millionaires spend time developing and managing a financial plan so they know their savings goals and monitor their progress towards retirement or college funding.They also found that about two-thirds of millionaires follow a household budget. In fact, the most popular vehicle among the millionaires studied was a Ford F150 pickup. The majority spend less that $200 on shoes and buy American made cars. In contrast, Stanley and Danko found that millionaires live well below their means. While they don’t necessarily have a lot of consumer debt, they often save very little compared to what they earn and spend the majority of their income on luxury items and “keeping up with the Joneses”. However, after looking a little closer I find that their lifestyle closely mirrors their income. who appear to be wealthy by looking at their tax return. I have met with very high income earning doctors, attorneys, etc. It is almost always a function of what they earn relative to what they spend. After almost 20 years in the business it has become pretty easy for me to identify if people have a good likelihood of becoming financially independent. They live well below their means.While this may seem obvious to many, I feel it is the most single important trait to develop, especially early on.I would like to share what the authors found to be some common traits among millionaires, all of which create a lifestyle “conducive to accumulating money”. Almost immediately I enrolled in classes to become a Certified Financial Planner™ and developed a passion for showing others that being successful financially was within their reach.
After reading the book it dawned on me that becoming wealthy typically wasn’t the result of being born with a silver spoon in your mouth, but rather discipline, planning, and making smart financial decisions. The premise of The Millionaire Next Door was to look at wealth in America and determine who the millionaires actually are and what traits and habits they shared. Missing were the luxury cars, finely tailored suits, flashy watches, and trophy wives all things at age 22 I assumed were the primary benefits of being wealthy! While I could see from their balance sheets that these people were wealthy, they didn’t appear to me as what I thought “rich” people would be. After a few months on the job one of the main things that struck me was the appearance of, along with my perception of, not only many of our clients but also the firm’s owners. My job title was “Property Maintenance Manager” and I was responsible for overseeing the maintenance department for over 600 rental units in the northwest suburbs. I started working for a small financial planning company that focused on real estate investing for clients. I graduated from the University of Iowa in December 1995 and after a brief stint as the Chicago land area’s worst waiter, began my career in financial services. The book was on the New York Times best seller list for over a year and reading it had a significant impact on me personally and professionally. While most people probably are not familiar with the name Thomas Stanley, millions have read the book he co-wrote with William Danko in 1996. Sadly one of the co-authors of The Millionaire Next Door was killed in an automobile accident this last March.