As a Dave Ramsey listener of eight years, I’ve heard time and again the statistics that Dave uses when talking about the “typical” millionaire. It took me long enough, but I finally read the book that serves as the research basis for so much of Ramsey’s philosophy of money.

Written by the late Dr. Thomas Stanley, The Millionaire Next Door is a book full of myth-busting. So much of the detailed research completed by Stanley and his research partners repudiates common misconceptions about what a typical millionaire lifestyle is like.

In essence, Stanley’s book reveals this truth: those who look rich, those who live a high-consumption lifestyle, seldom have any actual wealth. The typical millionaire drives a modest used car, doesn’t live in the richest neighborhoods, wears average clothes, shops at discount stores, and became rich through diligent work over time. Most millionaires are first-generation wealthy, and received no substantial financial assistance from family, friends, or the lottery. In other words, they worked hard, lived below their means, and saved money.

Stanley outlines the two strategies required to become wealthy: offense and defense. Even if someone has a good income, if they live a high-consumption lifestyle, they’ll never get ahead. This is especially true for married couples. If one spouse makes a great income, and the other spends it all, there’s no traction to be gained. You have to have the offense of steady income and the defense of good fiscal management and budgeting. Stanley also notes that even people making an average annual income, over the course of their working career, can become millionaires.

In the book, Stanley also looks critically at the transfer of generational wealth and connection between millionaire parents and the outcomes for their children. He details the data points in his research that point to whether the children of millionaires will themselves prosper or if they’ll turn out to be unemployed trust fund babies.

The book was a really quick read and fascinating. I’m appreciative of Stanley’s work and deeply regret his untimely passing a few years ago. If I decide to come back to this subject, I will undoubtedly pick up his book, Stop Acting Rich.

Would I recommend: YES

ISBN: 978-1603400381