Thomas J. Stanley (1944–2015)

This book is showing its age now (a section on buying used car rather quaintly suggests looking for blue books at book stores or the library) but it remains a valuable read. The authors have researched the characteristics of millionaires, defined as people with a net worth over a million dollars, and explain that many of them are counterintuitive. Millionaires often don’t look like rich people. People who look rich may have six-figure incomes but less net worth than you might show more think—because they spend all their money on fancy clothes, new luxury cars, private school tuition, ski vacations, and all the other depreciating trappings of high social status. People who have managed to accumulate a million dollars have often done so by not looking rich. Many are small business owners in blue collar fields where no one expects them to look fancy or live big; others may be professionals (often self-employed ones, like doctors or lawyers), but frugal ones.

Some interesting sections on the book are related to family. Most millionaires are men and many have nonworking spouses, but those housewives are coupon-clippers. (Your typical millionaire has been married only once.) Many millionaires grew up with parents who, regardless of their actual income level or standard of living, were frugal. The worst off? The adult children of the affluent who receive what Stanley calls “economic outpatient care.” Buoyed by gifts from their parents and the safety net of their parents’ affluence, these adult children often fail to become successful because they simply don’t have to. They never learn to live within their means or to adjust their spending to their income. A particularly boneheaded move is to help your child buy a house in a nicer neighborhood than they could otherwise afford; trying to match consumption with their richer neighbors will keep them forever in the hole.

The book is more descriptive than prescriptive, although it does give suggestions about how to raise children to be financially independent adults and has some suggestions for lucrative fields. Still, even non-entrepreneurial types will see more clearly, after reading this book, what it takes to become financially independent. show less

What I've noticed about books that are described as 'first in their category' is that many times they contain disappointingly small amounts of information. Why might that be?

In this case, I'd been looking at a few financial independence blogs and reddit threads, and saw this book mentioned a handful of times. I was aware of it previously as one of the first that examined people who became financially 'free' in their lives; "rich people don't buy new cars, just read TMND." What surprised me show more about this book was the utter lack of new information. After getting 25% in, I had to put it down; you could glean any of this information from a half-decent reddit wiki or introductory blog post on FI. So why do people call it so great?

My theory is that since originally topics like these were uncovering unexplored, fertile ground, readers were so amazed with the revelations that there was enough 'newness' to excuse, or possibly even warrant, such long-winded explanations. But when a category gets more popular and the basic knowledge becomes widespread, returning to the exploratory piece makes it seem dated and unoriginal. The reason it gets recommended is because those in the community doing the recommending did really perceive it as new when it was first released, and remember that experience of reading the book when recommending it to others. Unfortunately, as someone who likely already knows some basics, you won't have this same experience.

In summary, the book presents very little new information in a haphazard and difficult-to-read format of throwing tons of absurdly specific data at you (like answering, "What percentage of Irish-Americans save at least 2x the normal amount of money according to our made-up benchmark?"). It provides less value than you could get from spending 20 minutes reading the reddit financial independence FAQ. Definitely skip this book. show less

"Millionaire" in this book represents a changing of the goalposts. People who would've been called millionaires when the word was coined, would be called billionaires today. The prosaic small-business owners who accumulate a million of our inflated dollars are far humbler, culturally speaking, than the classic millionaire -- which is why the authors marvel at the difference between how millionaires live and how the public imagines they do.

Still, the advice on controlling expenditures is show more good, although I'd be less quick to follow their advice on buying cheap domestic cars. show less

I read this for a book club I'm in. I was hoping to learn about saving, investment, etc. Really all I learned is that the wealthiest people tend to live well below their means. That seemed pretty obvious to me already. After the first few chapters (where three separate examples are used to show millionaires don't spend money on clothes), everything just sounded redundant and drawn out. As many other reviews have said, this study could have easily been summarized in an article, rather than a show more full length book.

Additionally, this book is highly outdated. Part of it is due to inflation since it was published, but much of the social structure is also different now. Nearly every millionaire discussed talks about how his wife stays home with the kids, clips coupons, and makes meals. I understand that was the setting when the book was written, but it really does lack relevance to today's society. It's also difficult to read a book that was written during an economic up-swing when the current economy isn't as booming.

Perhaps this was a good read at one point, but I'd say it's time of relevance has passed. show less