ViRedd
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Of course many are satisfied being "workers." And yes, I agree that being a "worker" isn't a bad thing. I was one for the first 35 years of my life. So what? That doesn't mean that the average guy can't achieve financial success if he/she puts his/her mind to it. I've recommended a book to you several times in this forum. "The Millionaire Next Door." Have you read it yet?
Here's a review of the book:
*A Book Review*
The Millionaire Next Door
By Thomas J. Stanley & William D. Danko
by Michael C. Gray
June 23, 1999
The Millionaire Next Door is one of the most important books recently published on the subject of personal finance.
Thomas Stanley and William Danko are professors of sociology who have made studying wealthy Americans their specialty. They have performed extensive statistical research to profile who wealthy Americans are, how they acquired their wealth, how they live, and how their families function.
From the inception, Stanley and Danko make it clear that the image of "Lifestyles of the Rich and Famous" has nothing to do with the lifestyle of most wealthy Americans, especially first-generation wealthy Americans. Contrary to the belief of many people who believe most wealth is inherited and "you cant make it in America today," eighty percent of Americas millionaires are first-generation rich.
I am going to focus on first-generation wealthy Americans here, because they give the most valuable lessons for acquiring wealth. Ill call them "the wealthy."
The wealthy are extremely frugal. They do not live in extravagant homes and drive Rolls Royces or BMWs. They live in modest homes and mostly drive full size American cars. (57.7% of the vehicles millionaires are driving are American cars or trucks.) Many of them buy used cars (about 36%).
Most of the wealthy have their own businesses. Self-employed people are four times more likely to be millionaires than those who work for others. Most of their businesses are not Fortune 500 corporations.
20% of affluent households in America are headed by retirees. Of the remaining 80%, more than two-thirds are headed by self-employed owners of businesses.
The wealthy did not necessarily accumulate their wealth from high salaries or high incomes. Instead, they are excellent at managing their assets. The two main approaches used to accumulate their assets are budgeting and the "pay yourself" or set aside approach. (Take 15% of your earnings and set them aside as "untouchable" for personal spending.)
The wealthy are very proactive in their investment programs. They study investments and consistently invest in the areas they understand best.
The wealthy highly value education. Almost uniformly they underwrite the education of their children and encourage their children to pursue a profession, such as law, medicine, dentistry or accounting.
Many of the wealthy are immigrants who havent been caught up in the American consumer lifestyle.
The American consumer lifestyle is the greatest enemy of accumulating wealth. The children of the wealthy do not understand how their parents accumulated wealth, so they consume it. This is the reason family fortunes are dissipated. There are no wealthy Vanderbuilts today.
Why should the study of the wealthy concern you? Isnt money the root of all evil?
The economic facts are that the median (typical) household in America has a net worth of $15,000, excluding home equity. The median household net worth for the top one-fifth of American households, excluding home equity, is less than $60,000. Without Social Security benefits, almost one-half of Americans over age sixty-five would live in poverty. (And Social Security is in trouble!)
I should think that one goal that should be on the list of most people is to be financially independent. There is a certain confidence one has when in this position. Call it "peace of mind." You can do an enormous amount of good when you have the means. Yet, despite the fact that many people with relatively modest incomes achieve financial independence, most of us never get out of the starting gate!
I have read every page of this book. I found The Millionaire Next Door to be fascinating, educational reading and recommend it enthusiastically. Give it or loan it to family members. Be sure to put it on your summer reading list. Then take action on what you learn, and Ill have a lot of wealthy clients!
For our new reviews of business and self-improvement books, subscribe to our newsletter, Michael Gray, CPA's Tax & Business Insight!
ViThomas Stanley and William Danko are professors of sociology who have made studying wealthy Americans their specialty. They have performed extensive statistical research to profile who wealthy Americans are, how they acquired their wealth, how they live, and how their families function.
From the inception, Stanley and Danko make it clear that the image of "Lifestyles of the Rich and Famous" has nothing to do with the lifestyle of most wealthy Americans, especially first-generation wealthy Americans. Contrary to the belief of many people who believe most wealth is inherited and "you cant make it in America today," eighty percent of Americas millionaires are first-generation rich.
I am going to focus on first-generation wealthy Americans here, because they give the most valuable lessons for acquiring wealth. Ill call them "the wealthy."
The wealthy are extremely frugal. They do not live in extravagant homes and drive Rolls Royces or BMWs. They live in modest homes and mostly drive full size American cars. (57.7% of the vehicles millionaires are driving are American cars or trucks.) Many of them buy used cars (about 36%).
Most of the wealthy have their own businesses. Self-employed people are four times more likely to be millionaires than those who work for others. Most of their businesses are not Fortune 500 corporations.
20% of affluent households in America are headed by retirees. Of the remaining 80%, more than two-thirds are headed by self-employed owners of businesses.
The wealthy did not necessarily accumulate their wealth from high salaries or high incomes. Instead, they are excellent at managing their assets. The two main approaches used to accumulate their assets are budgeting and the "pay yourself" or set aside approach. (Take 15% of your earnings and set them aside as "untouchable" for personal spending.)
The wealthy are very proactive in their investment programs. They study investments and consistently invest in the areas they understand best.
The wealthy highly value education. Almost uniformly they underwrite the education of their children and encourage their children to pursue a profession, such as law, medicine, dentistry or accounting.
Many of the wealthy are immigrants who havent been caught up in the American consumer lifestyle.
The American consumer lifestyle is the greatest enemy of accumulating wealth. The children of the wealthy do not understand how their parents accumulated wealth, so they consume it. This is the reason family fortunes are dissipated. There are no wealthy Vanderbuilts today.
Why should the study of the wealthy concern you? Isnt money the root of all evil?
The economic facts are that the median (typical) household in America has a net worth of $15,000, excluding home equity. The median household net worth for the top one-fifth of American households, excluding home equity, is less than $60,000. Without Social Security benefits, almost one-half of Americans over age sixty-five would live in poverty. (And Social Security is in trouble!)
I should think that one goal that should be on the list of most people is to be financially independent. There is a certain confidence one has when in this position. Call it "peace of mind." You can do an enormous amount of good when you have the means. Yet, despite the fact that many people with relatively modest incomes achieve financial independence, most of us never get out of the starting gate!
I have read every page of this book. I found The Millionaire Next Door to be fascinating, educational reading and recommend it enthusiastically. Give it or loan it to family members. Be sure to put it on your summer reading list. Then take action on what you learn, and Ill have a lot of wealthy clients!
For our new reviews of business and self-improvement books, subscribe to our newsletter, Michael Gray, CPA's Tax & Business Insight!
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