Many millionaires reject status symbols whenever possible There are ways to start a small business that offers a value-add that doesn't require a college education.ģ. It was nice, in an era where we are thinking so hard about whether high-priced higher education is "worth it," to realize that there are options if college isn't of interest to you. However, it did point to some of the advantages of being the owner when a business idea takes off.
Stanley and Danko write: "These self-employed people are four times more likely to be millionaires than those who work for others." Of the non-retired millionaires, two-thirds of them were small business owners.ĭoes this mean every small business succeeds? Of course not. I expected more discussion of highly paid professionals (lawyers, doctors) as high-wealth individuals, but this book really focused on the many people who built a small business to the point of retaining more than $1 million in wealth. A huge percentage of millionaires are small-business owners The Fool is investors writing for investors.I believe that generational advantages also play a role, but it was refreshing to hear stories of people whose families were not wealthy and who still accumulated $1 million in savings or investments in a single lifetime. Blue Nile is a Hidden Gems and Rule Breakers recommendation while MasterCard is an Inside Value pick. He owns shares of Blue Nile, but no other company mentioned. Click here for more details.įool contributor Jim Mueller isn't a millionaire - yet. Trait number eight might have been: They read Motley Fool GreenLight. (After all, it's never too early to begin following the "live below your means advice," is it?) This book provides many insights as to what works and what doesn't, with data obtained from your neighbors. If you haven't picked up a copy of the book and read it, and if you have dreams of becoming wealthy yourself, consider checking a copy out of the library. You may look like you're wealthy, but, as they say, looks can be deceiving. ew could have ever supported a high-consumption lifestyle and become millionaires in the same lifetime." In other words, buying lots of frills, such as jewelry from Blue Nile (NASDAQ:NILE) or the latest large screen HD-TV from Circuit City, just because you have a large salary is not exactly the way to become wealthy. In discussing this topic and how it pertains to millionaires, the authors write, "Being frugal is the cornerstone of wealth building. However, I think the chapter that contains the most important advice is the one on living below your means. For instance, their data shows that people who routinely receive financial gifts from their parents every year are favorite customers of credit card companies like MasterCard (NYSE:MA), using credit heavily. Those people that do receive such help tend to be UAWs and not wealthy at all. 4 above, the authors point out that most millionaires did not receive substantial financial help from their parents. In the chapter devoted to what they call economic outpatient care, No. Only 2.7% drive the much flashier - and more expensive - Jaguar (coincidentally, also manufactured by Ford). The most popular are those manufactured by Ford (NYSE:F), such as the F-150 truck. 3 in the above list), they point out that most millionaires - more than 57% - drive American-made cars. For instance, in the chapter devoted to not keeping up with the Joneses (No. Stanley and Danko then devote the rest of the book, one chapter each, to a deeper exploration of each trait. They work in the right jobs, often for themselves. They target opportunities that benefit from large amounts of spending.ħ. What the authors did was take those similarities and boil them down to a list of seven traits that most millionaires share. While the average biography might not fit every single millionaire, many of them do share similarities. They weave the idea of PAW versus UAW throughout the rest of the book. It stands to reason, and their research bears it out, that most millionaires belong to the former category and not the latter. The authors then introduce the concepts of PAWs, or prodigious accumulators of wealth, and UAWs, or under-accumulators of wealth. They actually spent two or three hours being interviewed by the authors for a measly $250 or less. They are assiduous investors but rarely sell what they are invested in. According to their research, millionaires are usually well-educated (college or better), drive older cars, and are often self-employed. Stanley and Danko begin the book with a biography of the average millionaire.