Last week, I traveled to Virgina for business. I loaded up the The Millionaire Next Door (after reading all these great reviews) onto my Kindle and prepared for the flight. Truth be told, the book was very redundant and kind of outdated….a whole chapter on being an auctioneer? I mean, really? But there were a few things that I did take away from the book, so I figured I’d give you the list and save you $10 bucks and few hours!
1. Spend less than you make: This one seems obvious. But what was interesting about the book, is that a majority of the millionaires that he interviewed lived in middle class neighborhoods and drive inexpensive non-luxury cars. They did not feel the need to ‘keep up with appearances’ of being a millionaire.
2. You must have a cooperative partner: This means your partner, be it your spouse, boyfriend, lover etc. also has to live below his/her means also. If you are the one pinching pennies and your spouse is out spending money frivolously, you will never get ahead. One of the more interesting data points in the book was that oftentimes, the wife was more frugal than the husband. Which goes against just about every stereotype out there of millionaire wives (ahem….Real Housewives)
3. Do not invest your money in items that depreciate: I have this joke where I say, “I don’t like to buy anything unless it makes me money” which in most cases is true! Because I coupon, I do get a lot of stuff for cheap and free, but when it comes to buying things like clothing, cars or vacations, buying the top of the line or expensive models is not the way to go. Because as soon as you wear that dress, drive out of the dealership or return home from your vacation….you’ve already lost money! Putting your money in investments that actually appreciate is the key to building wealth!