Many people ask this question of themselves. Often they are hard-working, well-educated, high-income people. Why, then, are so few of them ‘affluent’? Some of the answers to this intriguing question are contained in the book The Millionaire Next Door by Stanley and Danko. We recommend this book for those who are serious about increasing their net worth.
Affluent people typically follow a lifestyle conducive to accumulating money. In the course of investigations by Stanley and Danko, they discovered seven common denominators among those who successfully build wealth:
1. They live well below their means.
2. They allocate their time, energy and money efficiently, in ways conducive to building wealth.
3. They believe financial independence is more important than displaying high social status.
4. Their parents did not provide economic ‘out-patient’ care.
5. Their adult children are economically self-sufficient.
6. They are proficient in targeting marketing opportunities.
7. They choose the right occupation.
Stanley and Danko discovered that building wealth takes discipline, sacrifice and hard work. If people are willing to make the necessary trade-offs in their time, energy and consumption habits, they can begin building wealth and achieving financial independence.