The Average Millionaire Lives Pretty… Average
“Yeah right”, “Get Outta Here”, “Stop Lying”, I know what you’re thinking as you opened this blog post and read that headline. Millionaires live lavishly in huge mansions, drive expensive cars and eat at fancy restaurants every night. Growing up watching MTV Cribs and seeing how celebrities and athletes lived I assumed every millionaire had this lifestyle. I was completely wrong and unaware of how the average millionaire moves. Reading The Millionaire Next Door by Thomas J. Stanley was extremely eye-opening for me. I highly recommend this book for anyone trying to learn about money and personal finance. I had no idea the average millionaire could be my next door neighbor.
From TV shows to music videos and movies I’ve been preconditioned to think all of the affluent people lived a certain type of lifestyle. Throughout my childhood, I gravitated towards that fancy millionaire lifestyle because it seemed pretty dope and looked cool to be able to drive whatever you want and dress up in nice clothes etc… It was a goal at one point in my life. I was equating material things to wealth and financial status. Striving to be affluent for all of the wrong reasons. I didn’t know that flashy millionaires were such a small percentage. If you’ve only been shown one type of millionaire you wouldn’t know that frugal millionaires existed. Don’t get me wrong I’m not one of those super frugal type of bloggers I too enjoy nice luxuries but in moderation. I’m not a frivolous spender, but I do spend a lot for the things that I love. I take calculated risks and live within my means. I think this is a great formula when it comes to wealth building in the journey to becoming a millionaire.
Here are some things that I thought before researching the true lifestyle of the average millionaire.
1.) Most millionaires were born into money.
Wrong!!! 80% are 1st generation millionaires which means it wasn’t inherited and they grew their riches from scratch.
2.) Most millionaires drive expensive foreign cars.
Wrong again!!! The number one car brand for a millionaire was a Ford and most bought their cars, pre-owned or used in cash. They rarely bought brand new cars off the lot. (Like I Did in 2013)
3.) Every millionaire must make a huge salary.
Guess again… Income does not equate to wealth. Some people who earn $300k a year are drowning in debt while some millionaires earned less than $100k per year but they saved and invested their income consistently. It’s all about what you keep.
4.) All Millionaires are Business Owners
Sorry… 50% of the millionaires were self-employed or owned a business. Although most of the Penta and deca-millionaires were business owners, being a business owner is not the only path to success. There are plenty of millionaires who are managers, accountants, engineers, dentist who just lived below their means for decades and became wealthy.
5.) Since you’re a millionaire you must live in a multi-million dollar home right?
Wrong yet again, 90% of millionaires lived in homes valued under $1 million and almost 30% lived in homes valued under $300k. And 50% of millionaires lived in their home for more than 20 years. I assume they didn’t sell their ‘starter home’ because of a salary increase. They kept their living expenses the same despite the new wealth.
Although some of the stats are outdated from the ‘The Millionaire Next Door’ the habits and concepts are imperative. There’s nothing wrong with being flashy, but don’t let that be the only thing you live for. Nowadays, when you look at social media there are plenty of people who appear to be rich because of the material things they display. They have a millionaire lifestyle on a Walmart salary. I promise you more than half of these people are living check to check. Soon as money comes in, it goes right out the door. Stop living rich and dying broke and be great with your money.
Stanley, Thomas J. and William D. Danko. The Millionaire Next Door: The Surprising Secrets of America’s Wealthy. Lanham, MD: Taylor Trade Publishing, 1996.