Real millionaires rarely look like a million bucks

[Herman Munster]

http://www.sun-sentinel.com/business/local/orl-ymspend1706dec17,0,211765.story?coll=sfla-business-front

The book showed that millionaires spend their money smarter than other people. They still do. Most important, the book showed that people with average, steady jobs can become millionaires over their lifetimes -- that most millionaires are made, not born. Indeed, 80 percent of millionaires are first-generation rich, the authors found. They are modest. In fact, they might live next door. The book's fundamental message about spending is this: You can look wealthy or you can be wealthy. For most people, the choices are mutually exclusive. So, in honor of the 10-year anniversary of The Millionaire Next Door, we caught up with Thomas Stanley.

During a blunt conversation, Stanley talked about common spending traits of millionaires a decade ago and in his current research, to be explained in his next book, which has the working title Looking Rich in America. The wealthy know spending matters. Financial health is about earning and spending. Although earning a lot of money is correlated with wealth, it's not a perfect correlation. "The spending issue is significant," Stanley said.

"I believe very strongly that not everybody can play great offense. In other words, not everybody can make $1 million a year or even $100,000. The typical household in the United States makes under $50,000 a year. "Given that, you have to look at defense. To play great defense, you have to know where all the money is going. And most people don't. So the first thing I would tell people is to account for every dime and nickel they've got and write it all down. You'd be shocked at how much money people waste. It's ridiculous."

They are thrifty. "There is still a wonderfully frugal group of people in America that we don't talk about, but they're out there," Stanley said. "The majority of them don't have a wine collection. They do serve wine to guests, but the median value of a bottle was about $13, not expensive stuff. "It's not an impressive lifestyle; it's just that they're not confused. The reason they don't have a second home isn't because they can't afford it. It's just a hassle." Stanley's most recent research for his coming book is about brands that wealthy people use. "There are a lot of millionaires buying stuff at Wal-Mart. They don't have a problem with buying, maybe, socks or underwear there or at a Costco or Sam's Club. Men's Wearhouse is selling them a lot of suits, I can tell you that," he said.

"People think, 'If I wear a $900 suit, I'm going to look wealthy.' The problem is, if you wear a $900 suit and put the glitz on, you're not going to look wealthy, because wealthy people don't do that. "What I'm trying to tell people, especially young, impressionable people, is this ain't the way the world works. If you're looking at being happier by having more things, get a life."

[originalpckelly]

1. You'd be very surprised how true this is...

very.

:rofl:

[Lydia Leftcoast]

2. I noticed when I was at Ivy League schools that the super rich

"old money" students almost invariably dressed in a subdued, even sloppy manner.

Outfits I remember include:

A patchwork skirt, Fry boots, and a football jersey

Jeans, a blazer with patched sleeves, a wrinkled shirt with a loose tie, and Top Sider shoes worn without socks

A pleated skirt, tights with holes, a Fair Isle sweater, and really ratty hair

[WinkyDink]

3. So I'm hallucinating Fifth Avenue, Trump Tower, Monaco's yacht

basin, gated communities, Ferraris, Rolexes, Manolo Blahniks, Gulfstream jets, multiple plastic surgeries, and the Nieman-Marcus Christmas catalogue?

Nice try at that age-old "the rich ARE just like you and me" scam, but no, thanks.

[jgraz]

4. Those are 100-millionaires...

In california, anybody who has their house paid off is worth close to a mil.

[pnwmom]

10. No, there are people like that

but sometimes they are people who are getting by on high salaries and are not really prepared for a major setback.

And then there are the ultra-rich (not plain old millionaires), and they're a different story altogether.

[CJCRANE]

15. Yes, that's "rich"

but that doesn't necessarily mean "wealthy".

Just look at all the stories about celebrities who spend all their money on sports cars and big houses then go bankrupt because they have no money left to maintain it all.

[PennyK]

5. Well, my bro-in-law has a few millions

And he goes around in an old sweatshirt most of the time. However, he dresses well when he needs to. His wife (my sister) has plenty of expensive jewelry and clothing, but she loves to shop at Target and will go back to the Gap if shomething she bought gets marked down. So I guess you spend it where you want to, and save it where you can.

[sweetheart]

6. "the millionaire next door" --> great book

It has excellent insights for any person doing financial planning.

So does another book: "Die broke" (means spend it all while you are alive).

[Sydnie]

7. That is absolutely the truth

My ex-in-laws were multi-millionaires. My FIL was a physicist, eventually owned his own business (that was the only company that made a necessary part for bulldozers and bobcats, for example), attended Columbia when he was 16, and went to the pole with Admiral Bird when he was younger. He was quite accomplished, but what he had, he had earned on his own. My MIL was a Radcliffe graduate herself. They both played instruments in a string quartet for fun, were very involved in town politics, and not the least bit religious (so no donations from them to delete their funds).

The first time I went to their house, I was amazed at the sparse decor and the cement floors (of course, I later found out that they had radiate heat built into the house when the standard for the area was still hissing radiators). They lived in a neighborhood of similarly educated and wealthy people who banded together, bought a lot in the neighborhood together and shared the expense of building a single in ground pool for all of the children of their neighborhood to share. They were co-oping before it was popular with ideas like that. They never dressed fashionably at all. Actually, they were rather frumpy in their appearance. They had the same appliances in their house for 30 years, choosing to repair rather than replace. When they did finally replace the appliances (because parts were no longer available for repairs and fabricating them for themselves would have been cost prohibitive) they purchased basic models from Buyers Direct, another type of insider/co-op type of club store.

They bought a vacation home in the late 60's, but even that was not your usual vacation home. They purchased an island off the coast of Maine with a single house already on it. They had generators for electricity and cisterns for water. They showered in the front yard since the house had no bathroom facilities. They had a three holer next to the house, which the kids would shovel and cover with ash to aid in decomposition. They composted all vegetable waste to use in the gardens on the island. They built their own dock and added a "bunkhouse" type room on the house for the children to sleep in. It too was very sparsely decorated as most of their time was spent outdoors there, fishing, boating, and observing and interacting with the nature of the island. If they felt the need to socialize, there was another larger island a short boat ride away with many houses and many children, as well as many community driven activities all season long. Imagine, the kids looked forward to the weekly square dances held on the other island!

If you met them on the street, you would never know of their accomplishments nor their wealth. But, they enjoyed their minimalistic lifestyle and were an example for all who knew them or wanted to achieve as they had.

When I was younger, I thought them very eccentric. I now totally understand why they were as they were and I appreciate that so much more than I did at the time.

[Purveyor]

8. Perhaps they are 'millionaires" but are they truely "rich"? n/t

[Kindigger]

9. My Aunt Edna

My Dad's sister Edna was the eldest of twelve, and grandpa was a sharecropper. Edna didn't go to school past the sixth grade as she had to stay home, and take care of the younger ones.

She married a farmer, and stayed home to raise a daughter. Her husband Ed was very strange, and he got stranger as the years went by. He had foil on the windows to keep out prying eyes, and believed someone was trying to poison the well. Uneducated, and married at fifteen, Edna thought this was normal. She remained a dedicated wife, and a simple, happy soul in spite of the fact she wasn't allowed off the property for the majority of her life.

I don't think I ever saw Uncle Ed until his funeral. He was buried in his Sunday best. Edna was dressed as always in faded, tattered 1940's flashback. She appeared respectfully somber, but not overly devastated.

The foil was finally removed from the windows, and the coffee cans full of cash were found throughout the house, and around the farm. Aunt Edna was a millionaire at the age of 80.

She had three wishes: to buy a car (if they didn't cost too awful much), learn to drive, and buy a new outfit. I'll never forget that outfit: a simple navy blue dress, matching patent leather purse and shoes, white gloves, and the most outrageous hat covered with pink silk flowers. It was the year 2002, and somewhere in Illinois one could buy brand new 1940's flashback!

She selected a 1985 blue Ford Escort, and we were all there that day she got behind the wheel, and drove endless circles around the farm yard. Every time she came 'round she'd holler "WEEEEEE", grinning from ear to ear.

Edna died a year later in a retirement home. Her well educated, middle aged daughter had succeeded in having her declared incompetent, and dispensed just enough money to keep her there.

[renate]

12. I'm glad she was happy!

I'm especially glad she didn't merely endure the first 80 years of her life in order to enjoy the last one... her life sounds impossibly difficult to most of us but apparently she was blessed with a temperament that kept her from being miserable in those unhappy circumstances.

I hope she felt that her daughter was taking good care of her.

[Kindigger]

17. I don't think she ever knew how evil her daughter was

I remember the day we went to visit not long before she died. She lived in a little four bedroom house; one of five built just for this purpose. It was all women. They had a community living room, kitchen, and their own bedrooms.

She was so proud to have us meet her new friends, and see her first very own room :) It was surreal. It was the child's room she'd never had; ruffled spread, matching curtains, and covered in stuffed animals.

Edna got sick one day, and developed pneumonia. They took her to the small local hospital. Her daughter signed DNR papers, and left her there. The doctors said she probably would have lived if they had permission to transport her to a larger hospital.

There's a special place in hell reserved for her daughter.

[Hav]

18. .

Well that's a pity (concerning her daughter). But I always think that these kind of people are punished enough because of their character, living miserable lives because misery is all they have.

Aunt Edna sounds like a modest and benevolent person and I hope she enjoyed most of her life even if it wasn't always easy. She would have deserved it.

[Raine]

11. True...

there are more people like this than anyone would ever guess.

[Selatius]

13. A millionaire isn't rich by any stretch of the imagination.

If you lived modestly and made just 40,000 a year for your working life, then with common sense investment choices you could end up being worth 1 to 5 million by the time you die or even retire.

However, somebody who is worth that much isn't the same as somebody worth 1 to 5 billion or greater. The real money is with people like the Waltons.

It is disingenuous to lump in people who are barely millionaires with people who are worth hundreds of millions or even billions.

[rollopollo]

14. This applies

...to the one millionaire I do know. You could never tell by the way he looks or talks. He drives a Prius. And just as the book says, he is just about the thriftiest person I have met.

[Dulcinea]

16. I know people like this.

They're worth a lot of money, but they're the most unpretentious people you'd ever meet. They carry no debt except for their house for tax reasons & don't spend money on things to impress other people, like expensive clothes or cars. They paid cash for their minivan & drove it away rather than make payments on an SUV. More power to them!

[TomClash]

19. A million dollars is chump change to truly rich people nt