This one was recommended by a myriad of financial blog sites, so I finally dug in and read it. Basic premise is no shocker– the wealthy do not flaunt their wealth– they’re the ones buying used Hondas and reasonably priced suits and modest housing. Instead of buying “stuff” they are investing in stocks, businesses, real estate. They are frugal.
Here are the seven factors of those who successfully build wealth:
1. Live well below your means.
2. Allocate time, energy, & money efficiently in ways conducive to building weath.
3. Believe that financial independence is more important than display of social status.
4. Parents did not provide economic outpatient care.
5. Children are economically self-sufficient.
6. Proficient in targeting market opps.
7. Choose the right occupation.
The book also touted the pursuit of occupations to serve the wealthy, such as estate and tax law, accountancy, brokerage.
How to determine if you’re wealthy:
Multiply age times realized pre-tax annual household income from all sources.
Divide by 10.
This is what your net worth should be. Got some work to do on this one too.
PAW (prodigious accumulator of wealth) vs. UAW (under-accumulator of wealth).
PAWs are worth twice their expected net worth.
Overall, not a bad book. Quick read, and reinforces ideas you probably already have (especially if you’re motivated to pick up the book).
auth=Stanley, Thomas J.
sub=The Surprising Secrets of America’s Wealthy