Millionaire Next Door

I purchased the book ‘The Millionaire Next Door‘ by Thomas J Stanley  & William Danko second-hand, from Amazon.

Inside was a handwritten inscription:

Merry Christmas 1999.
Here’s to the First Million!
Love [unreadable name]”

At first glance, it looked like ‘Cindy’ hadn’t even bothered to open the book as it was in pristine condition, with no creasing in the spine or cover and it had all the appearance of having been left on a shelf with other unread books.

However, throughout the book, there were a few handwritten notes and certain paragraphs were underlined, so she did at least have a read of it.

Millionaire Folk

In a nutshell, from the results of an extensive survey, the book depicts how folk on above average salaries (mostly but not exclusively entrepreneurs/self-employed) become millionaires and maintain their millionaire status by living below their means, budgeting, not succumbing to consumerism, investing their money and making the most of opportunities to make money.

Sound familiar?

Those who regularly read the various FI/PF blogs will feel like they’ve read all this before and bought the t-shirt – I found that the book did seem to be covering some ‘old ground’ but  there were interesting examples and stats.

I guess it was worth reading first hand the book which many people have cited as being inspiring and changing their way of thinking how they live their lives and how they view ‘wealthy’ or ‘rich’ folk.  None of  the millionaires in question achieved their wealth via inheritance or lottery wins.

It had me checking out my own neighbours and wondering which ones were possibly millionaires.

Becoming a Millionaire

It sounds like the person who bought this book for Cindy thought that it would be a guide on how to become a millionaire.

Perhaps it is, but in order to become a millionaire, it helps if:

  • you earn a decent income ($70,000 per year is cited, although the book was written in 1998, so a much higher salary might be needed today);
  • you marry someone who is good at budgeting and is frugal;
  • your grown up children (if you have any) are also frugal;
  • you buy your cars second-hand instead of new;
  • you invest your money and spend time planning your investments

What If?

I’ve never had any real aspirations to become a millionaire – it has only ever been a dream for me and sadly, a dream which involved winning the lottery!

I did wonder what would have happened if, like Cindy, someone had gifted this book to me in 1999, a time when I was probably at my most ‘spendy’ and deep in credit card debt.

If I had read it back then, it would certainly have been a complete revelation and could have changed my financial outlook – I could have been well on my way to achieving FI much earlier in life.

The reality however is that I probably wouldn’t have even bothered to read it and it would have been on a bookshelf gathering dust. The person I was in 1999 would not have been mentally prepared for a lifestyle change, nor I’d say, be willing to change.

The good news is that I don’t need to be millionaire to retire early. Or even a half-millionaire (Semi-millionaire? I’m making up words here!).

Like the successful millionaires interviewed in the book, I think I know what my “enough” is and I’ve shown over these last couple of years that I won’t succumb to life-style inflation.

I just need to keep plugging away at the savings and investing to keep my wealth ticking up.

I wonder if Cindy ever became a millionaire?

Anyway, the completion of this book means that I have achieved one of my reading goals – yay!

13 thoughts on “Millionaire Next Door

  1. Hi Weenie,

    This was one of the books I read this year too. Like you’ve said in your post, for most of us who regularly frequent the FI/RE blogosphere the revelations in the book are not really new, but I enjoyed reading about all the stats which back the theories up.

    Congrats on hitting one of your book reading goals for the year!


    • Thanks OR – just about to hit the second reading goal too so very pleased about that!

      Yes, there weren’t huge revelations in the book but the examples and stats (even though they were from 1998) were interesting.

  2. Congratulations on reaching the reading goal!

    I’ve never read the book but at some point I will get it from one of the libraries near me, but it seems like it will be the same type of careful live below your means approach which we all try and achieve.

    I will get round to reading it one day 😉


    • Thanks FiL

      Yep, as well as the now familiar live below your means info, other interesting stuff in the book included the different types of careers/jobs which millionaires had – there were the usual doctors, lawyers, dentists, accountants and engineers but some other eye openers in there! As it was written in the late 90s, it didn’t include You Tubers! 🙂

  3. I’ve not read this book, and thanks to your overview, I don’t have to either 😉

    However, I got free audible credits and listened to the Snowball, which you might like – it’s about Warren Buffet…

    Merry Christmas, almost!

  4. “you buy your cars second-hand instead of new”: almost always good advice to anyone. And when it’s wrong it’s because you should have bought a motorbike instead of a car.

    • Another reason why I’d not be a millionaire – I’ve only ever bought new cars! There’s hope for me yet with my next car, I guess!

      Me on two wheels? I’m bad enough on a pushbike!

  5. Well done on the reading goal Weenie!

    I like the basic idea of MND but there was too much that made me grind my gears for me to buy into it.

    The way that their questionnaire was addressed to the ‘Head of the Household’ and then they used this as evidence that most millionaires were men rattled me. When you read the further detail it seemed that most of the household units were couples (and they spoke about the team efforts of their subjects). The fact that their measure of net worth accumulation was only based on your current salary seemed too simple to be useful to me. I read it the year after I’d got a chunk payrise which had all gone to savings, so I had to be doing better that year right? But according to their formula I was now an under-accumulator of wealth whereas the year before I would have been the next level up.

    However I loved the section where they looked at who actually bought the ‘millionaire-looking’ cars and showed that most people in the fancy cars could barely afford them. This has really stuck with me when I get car envy!

    • Hey PwF

      Yep, that was a little annoying, ie that all the millionaires were men and the women mentioned were wives of millionaires. There was mention of gender pay gap – 18 years later, there’s no change there, although I’m sure there are a lot more millionaires who are also women compared to 1998.

      There was a guy I used to work with – he lived in a really nice area and obviously wanted to keep up with the Joneses. He bought a Porsche and yes it looked good until he admitted that he had remortgaged his house to buy it…. I know!!!

  6. I’ve ordered the book from the library (80p). Whenever you see someone with a flashy car, just say “big car, small dick”, its very therapeutic 🙂

    I bet none of our neighbours know that Mum and I are both millionaires…

    • Hi John B

      Well, good job I’ve never been attracted to guys with big flashy cars! 😉

      Haha, well done on you and your Mum covertly being ‘the millionaires next door’!

  7. Nice write up weenie.

    TMD is one of those books that will forever be on my to read list I think.
    I’ve just read so many blog posts citing it I feel like I’ve read it already! 😀

    Happy new year by the way

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