The Millionaire Next Door: The Surprising Secrets of America's Wealthy

This is an excellent, data-backed look at what the wealthy look like in the United States. Contrary to popular belief, most wealthy people do not drive Teslas and eat caviar. They are not tech CEOs or Wall Street financiers. They are small business owners and self-employed professionals who probably drive a 3-year old BMW or a Ford pickup truck or SUV. They probably wear a Seiko watch, not a Rolex. They probably wear a suit bought from Men's Wearhouse, not Brooks Brothers. They probably have a run-of-the-mill Visa credit card, not something from Sak's Fifth Ave.Some of the many useful insights and takeaways from this book:A Useful Definition of Wealth -- Wealth is much more than how much money you pull in every year and how much your house costs. It's more a reflection of your investments and how much money you save. Not how much you spend. There are a lot of people who pull in a ton of money every year but live paycheck-to-paycheck.Wealth and income are not the same thing -- Not all wealthy people pull in a hefty income. In fact, many purposely pull in relatively low incomes in order to reduce their tax obligations. Ross Perot is a great example of this (when the book is written). Perot pays millions in taxes, but is worth billions. Even your neighbor next door might be a millionaire, but maybe the household only brings in $79,000 a year.Most Millionaires Are Self-Made -- While children of millionaires are more likely to become millionaires, very few millionaires (less than 20%) are not self-made millionaires. In fact, regular handouts from parents make it less likely that an individual will become a millionaire someday. Most millionaires worked for their money and were not constantly given Economic Outpatient Care (EOC) from their parents.Frugality Reigns Supreme -- The authors give a great analogy about building wealth. You can play a great offensive (i.e. pulling in money) and you can make a great defensive (i.e. saving your money and preserving your wealth). Playing a great offensive is wonderful, but it is really only useful for building wealth if you don't play a great defensive too (some people are capable of playing such a great offensive that the defensive really isn't important, but this is very few people). They buy discount suits, discounted new cars or used cars, they rely on very, very little credit, and status symbols aren't all that important to them.Mindset Matters -- Most millionaires are not worry-warts. The only things they really worry about are government policies that will destroy their livelihoods, but even then, they know that they can't really control the outcome of these issues directly, so they only give so much effort and so much weight to these decisions.My only quasi-criticism of this book is that the data are from 1992-1996 and the book was written in 1996. This obviously isn't the fault of the authors, and some of the conclusions are reinforced in a 2010 preface, but just take some of the data with a grain of salt. Take inflation and general industrial changes into account.Well worth the read, especially if you are looking to join the ranks of the Prodigious Accumulators of Wealth or work with them.

Excellent book. Good read for someone who is a self taught on their personal finances.

This is the second time I read this book. It does provide a lot of tips and financial advice. The reason I give it a four star review instead of a five is because the book provides a lot of statistics and trends from the 90's. I think otherwise is still a very good book to read.

This book could seriously change your life.These guys did a lot of research that I think would surprise -- yet, ultimately encourage -- most folks.Three key findings:1) Most people who are millionaires don't live the flashy lifestyle2) Most people who live the flashy lifestyle aren't millionaires3) YOU can adopt a few simple lifestyle changes and mentalities that will make it MUCH EASIER for you to achieve financial security by simply realizing where your money goes each month! By starting to play better financial 'defense' you can become much more financially secure.The authors present interesting and compelling facts in a persuasive and interesting manner. This is a quick read. It could turn most of your assumptions about wealth accumulation and financial security on their heads!I borrowed and read this book years ago, but wanted to read it again. I bought it used and finished it in two days; it is all still relevant. I highlighted only the parts I thought were gems, and used up a whole highlighter. These principles WORK (suffice to say, they did in my case)!The self-made wealthy already abide by most of these concepts; they drive used cars, shop for bargains, and usually don't buy fancy homes!The high-earners with little to show for their years of high income will find practical advice to stop the bleeding and start building wealth; they will recognize their dumb habits immediately!Those with a low income will benefit by the encouragement and practical tips to begin growing wealth -- it can be done, and there are plenty of examples of it!If you want a book packed with a lot of just plain 'uncommon' common sense, get this one. It will make it easier for you to do the right things for your financial future. You will have less desire to live a "BIG HAT, NO CATTLE" lifestyle once you realize you could have financial independence instead -- an even bigger luxury.This is a book I think that should be recommended reading for every high school student; if people realized all the wisdom packed into these pages, we would see far more sensible life choices being made by American households. We wouldn't have so many families buying stuff they don't need -- with money they don't have -- to impress people they don't like!In summary: You're buying a lot of valuable wisdom in a very inexpensive book. Make this book your first investment. I can't recommend it strongly enough.