The Next Millionaire Next Door

Jan 7

I’ve always been very type A. Conscientious is the way I prefer to say it. My grandma taught me the word “initiative” when I was very young. She told me that it meant doing what needed to be done without having to be told. I believe this lesson was the beginning of my conscientious lifestyle. For better or for worse you can catch me doing things that need to be done. Sometimes I do them begrudgingly. But either way, they get done. When I first read The Millionaire Next Door, Dr. Stanley made me feel proud of what my grandma taught me. He was able to demonstrate the power of initiative in wealth building. He demystified the lifestyles of the truly wealthy.

When I realized that Dr. Stanley had a follow up to The Millionaire Next Door, I was curious about whether or not it would have the same impact. Sadly, the beginning of the book starts with his daughter Sarah informing the reader that she finished the book without him. During the process of researching and writing the book Dr. Stanley was killed by a drunk driver. Sarah shared that she finished the book without her father but included notes and posts written on his website. I was floored by Sarah’s strength to finish the project and was happy that she had some of her father’s material to work with. It was great to get his perspective and to see follow ups with those he interviewed in the past. Sarah did a lot of interesting work on conducting new research on the wealthy. I believe that the tag team approach made this book great.

Here are a few key points that stood out to me.

1. “To build and maintain wealth over time, it will be necessary for you to approach all financial management--spending, saving, generating revenue, investing---in a different, more disciplined approach than anyone else around you.”

The person who struggles with comparisons is the person less likely to become wealthy. In the age of Instagram and Facebook we are bombarded with the highlight reels of those we know well and those we don’t. When we see the reels of those we know well we have the ability to separate social media from reality. We see the beautiful family photos on Facebook, but we also know that those smiling children are heathens that no one wants to be around. Fact vs. fiction. When we see the lives of loose ties we don’t have the same discernment. When we see people buying, traveling, and doing things that we want, we want to show off ourselves. But, all that showing off is costly financially, and costly in the happiness department. If we are constantly comparing we can’t be happy with what we have. To truly build wealth we have to silence that small voice that tells us that happiness will come once we get our Telfar bag in the mail. Maybe that’s just me though. You have to be different. You have to go against the crowd. You have to ask yourself why instead of just swiping. Everyone else will appear to be living it up but you have to stay strong to truly build and maintain wealth.

2. Who you spend time with affects your ability to build wealth.

During one of our many shopping trips, my sister and I decided to venture to Coach to see if they had anything interesting. Fairly quickly, I found the cutest bag charm. It was a red T-Rex made out of leather. It was beautiful. I decided I was buying it. I then turned my eyes to my sister. She was there with nothing in her hand. I didn’t want to shop alone so I encouraged her to buy a leather blue shark. It was adorable. She was somewhat uneasy about the purchase. As she should’ve been. It was completely unnecessary. Of course the story ends with the both of us exiting the store with charms in hand. I encouraged my sister to make a poor financial choice. That choice was only made because I was present. Now I obviously don’t want my sister avoiding me. But, I believe that it is important to think carefully about the company you keep when it comes to money. Are you around people who always claim they are broke? That’s a disease I don’t want to catch. They are on the avoid list. Do you frequently have conversations with friends who look at you crazy when you tell them something isn’t in your budget? Maybe reduce your time with these people. You will likely absorb their bad habits and bad vibes. If you are spending time with people who are responsible with money it’ll rub off on you. In the book, many millionaires stated that their spouses were huge influences on their wealth building. My advice, ladies don’t marry a scrub and men don’t marry a gold digger.

3.“Economic success is dependent upon effectively managing resources.”

In my favorite Disney movie Aladdin, Aladdin wishes to be a prince. With this wish he secures riches beyond his dreams. He wears a fancy outfit and rides into town on an elephant. All of this is a result of a wish he made to a genie who inhabited a magic lamp. Everyone knows you get three wishes right? By the time Aladdin is a prince he still has one wish left. Things go south when Jaffar, the villain, steals the lamp before Aladdin’s last wish. Aladdin had a pretty difficult time keeping track of the one resource he needed to maintain his riches. The lamp. Obviously our income is our greatest resource when it comes to building wealth. But do we treat it that way? Do we spend money we don’t have? Do we refuse to save? Do we wait until it’s too late to plan for retirement. Yes, most people do. These are the absolute worst ways to manage our resources. Instead of throwing caution to the wind we must save and invest wisely. When I say invest I don’t mean just throw money into a hot stock a friend told you about. I mean spending as much time as you can researching and collecting information on investments. I mean paying professionals for their ability to manage your emotions when there are changes in the stock market. It doesn’t matter how much you have as long as you manage it well. Do your best to guard your resource. Don’t be like Aladdin.

In the previous post I shared that I’m on a “finance book reading kick” as of late. I feel that it is important to say that I don’t feel that wealth is the cure all to anyone’s problems. I don’t want it to seem as though I now value wealth more than anything. Of course I don’t. I value my faith, my family, and my purpose a lot more. However, I do believe that following a financial plan for your life is one of the best ways to demonstrate discipline and self-denial. In the book, the authors explain that the millionaires interviewed reported that they felt the most sense of pride during the journey to wealth. Not at the end. That’s because they’ve been through times of restriction and were able to see it all pay off. They were able to make choices for themselves because they needed to make them. Not necessarily because they were told to. They had the initiative to follow a plan. Grandma would be proud of them.

The Next Millionaire Next Door

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