Saturday, March 18, 2006

"The Millionaire Next Door" - book review

Last week I read this book written by Thomas Stanley and William Danko. If you are a numbers person like me you will certainly enjoy this book. If you can't handle numbers it is likely still worth reading about the first 80 pages to get the main thesises of this book, however you may struggle through the many statistics throughout the rest of the book.

The book is the result of a study conducted by the authors of the wealth people (net worth of more than $1m) in America. Their findings were some what unexpected. The wealthy are NOT the people you expect them to be. The wealthy people live in average homes in modest neighborhoods. They drive modest cars, and generally are not distinguishable to the eye from their middle-class neighbors. These people become wealthy by hard work, wise investment and money mangement, and especially by being very frugal.

For me, this book was a powerful reminder of how average people can become wealthy. It was valuable to think through the importance of living a frugal life, and it allowed me to reevaluate what my money-spending goals are.

On the downside of things, there are certainly some elements of this book that are at odds with the Chirstian faith. The book certainly makes wealth building the number one priority. We are warned in Scriptures against making wealth too high of a priority. Proverbs 28:19-22 says, "He who works his land will have abundant food, but the one who chases fantasies will have his fill of poverty. A faithful man will be richly blessed, but one eager to get rich will not go unpunished. To show partiality is not good-- yet a man will do wrong for a piece of bread. A stingy man is eager to get rich and is unaware that poverty awaits him."

Another philosophy that the book gets wrong is in its view of charity and giving. The book seems to promote a stingyness in how much you give away. The authors do speak positively of giving money away in retirement, but little until then.

Anyways, it is certainly a worthy read, especially the first 80 pages!


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