You’ve probably heard the saying, “The rich get richer and the poor get poorer.” But is that really true?
According to Thomas J. Stanley and William D. Danko, authors of the book “The Millionaire Next Door: The Surprising Secrets of America’s Wealthy,” the answer is no.
In their book, Stanley and Danko dispel the myths about who the typical millionaire is and reveal the secrets of how they became wealthy.
Here are 10 things you may not know about America’s millionaires, based on the findings in “The Millionaire Next Door.”
Table of Contents:
1. The typical millionaire is not who you think he is.
2. Most millionaires are self-made, not born into wealth.
3. Millionaires live below their means.
4. Millionaires are frugal.
5. Millionaires have a high savings rate.
6. Millionaires invest in themselves.
7. Millionaires have a long-term perspective.
8. Millionaires are patient.
9. Millionaires take calculated risks.
10. Millionaires know their net worth.
11. Conclusion
1. The typical millionaire is not who you think he is.
If you think the typical millionaire is a middle-aged white man who drives a luxury car and lives in a big house, you’re wrong.
According to Stanley and Danko, the typical millionaire in America is actually a self-employed business owner who is college-educated and in his early 50s.
2. Most millionaires are self-made, not born into wealth.
Contrary to popular belief, most millionaires are not born into wealth. In fact, Stanley and Danko found that only 19% of millionaires inherit their wealth.
Instead, the vast majority of millionaires are self-made. They’ve built their wealth through their own hard work, dedication, and determination.
3. Millionaires live below their means.
Despite their high incomes, millionaires typically live below their means. In fact, they often have a lower standard of living than you might expect.
For example, Stanley and Danko found that only 6% of millionaires own a home worth more than $1 million. And despite their high incomes, many millionaires drive used cars and live in modest homes.
4. Millionaires are frugal.
Millionaires are often frugal, meaning they are careful with their money and avoid wasteful spending.
For example, Stanley and Danko found that only 17% of millionaires spend more than $1,000 per year on clothes. And only 5% of millionaires spend more than $3,000 per year on vacations.
5. Millionaires have a high savings rate.
One of the secrets of millionaire success is a high savings rate. According to Stanley and Danko, the typical millionaire saves at least 10% of his income each year.
6. Millionaires invest in themselves.
Millionaires know that one of the best investments they can make is in themselves. They understand the importance of lifelong learning and continue to invest in their own education and development.
7. Millionaires have a long-term perspective.
Millionaires think long-term. They’re not looking to get rich quickly. Instead, they’re focused on building wealth over the long haul.
8. Millionaires are patient.
Millionaires are patient investors. They understand that good things take time and they’re willing to wait for their investments to pay off.
9. Millionaires take calculated risks.
Millionaires are not afraid of taking risks. But they’re not reckless either. They understand the importance of taking calculated risks that have the potential to pay off big.
10. Millionaires know their net worth.
Millionaires track their net worth so they always know where they stand financially. They understand the importance of monitoring their progress and making sure they’re on track to reach their financial goals.
11. Conclusion
If you want to be a millionaire, it’s important to understand the secrets of America’s wealth. They are not who you think they are and they did not inherit their wealth. Instead, they are self-made millionaires who have built their wealth through hard work, dedication, and determination.