The threshold for determining the wealthy in the book was anyone with a net worth of over $1m dollars. The distinction between your assets and liabilities is very important and you can read more about this here. Net worth is defined as assets minus liabilities. You can earn so much and consume most of it. Often, people consider themselves wealthy based on their income. One of the most important messages of the book was defining wealth based on net worth.
I am just providing a summary and barely scratching the surface. To get the best of what the book is offering, you need to read it. Here are 5 important lessons that provoked a lot of thinking when I read The Millionaire Next Door.
We can still learn from people we don’t totally agree with. Regardless of the issues already mentioned, there was a lot to glean from the book. This might explains some of the successes experienced by the Millionaires. I reckon that a person with a wife who was home full-time and took care of the homefront has the freedom to fully concentrate on building a successful business. One of the findings of the study of the millionaires was that majority were self-employed business owners or self-employed professionals. If childcare costs are managed and kept to a minimum, this could result in an increased net-worth for the family.ĭespite the gender stereotypes mentioned in the book, I decided to be open-minded and treat it as a study, which it was. In addition, if this were applied in a single-income family where the husband’s income is low, it might be more sensible for the wife to also work and bring in additional income. Asides from removing the possibility of a woman becoming a millionaire or pursuing other passions besides homemaking or teaching, different households have varying circumstances. Another observation was that teaching was the top profession of the wives of the millionaires studied.Ī possible direct application of this would be to say, for a man to become a Millionaire, marry a teacher or a housewife. For instance, the study of millionaires showed that the majority of their “wives” were housewives. There were a lot of references to women’s roles in the home in the book. This colored my perspective a bit before reading. I listened to a video where someone talked about the book and mentioned that the writer was misogynistic. ‘Ordinary Millionaire’ in the book refers to self-made Millionaires who have not inherited money. The book was written by Thomas J Stanley and William Danko and is based on a study of ordinary millionaires. Our book club book of the month for February was The Millionaire Next Door: The surprising secrets of America’s wealthy. Some links in this post are affliate links which means I get commissions for purchases made at no extra cost to you.