This gives you a dollar figure to compare with your personal net worth (assets minus debts). The formula works as follows: multiply your age by your pre-tax (gross) income from all sources except an inheritance. Average accumulators of wealth (AAWS) are in the middle 50%. PAWS (prodigious accumulators of wealth) are doing better than average (top 25% of households) and UAWS (under accumulators of wealth) are in the bottom quartile. Instead, they own or manage “dull-normal” (the authors’ term) business such as a fuel oil company or funeral parlor.Īn especially helpful part of the book is a formula, described on page 13, to evaluate your own financial progress based on your age and household income. Contrary to popular myth, many millionaires do not work in a “glamorous” occupations. The Texas saying “Big Hat- No Cattle” means that many people who look wealthy (big hat) really aren’t (no cattle). Key findings from Stanley & Danko’s research include the fact that most millionaires exhibit discipline and hard work. Danko, Ph.D., to determine characteristics that millionaires have in common. Research was conducted by the authors, Thomas Stanley, Ph.D., and William D. The average age of millionaires is 57, indicating that, for most people, it takes three or four decades of hard work to accumulate substantial wealth. Self discipline (i.e., regular investing and living below one’s means) are key factors. Also, most millionaires work hard to achieve their wealth they are not born with it. In reality, though, most millionaires become wealthy the old fashioned way: they grow rich slowly over time through a combination of systematic investing and compound interest.Īccording to the book The Millionaire Next Door, you can’t necessarily tell if a person is wealthy by looking at them. And then there’s always the possibility of winning $1 million on the Who Wants to Be a Millionaire? television game show.

A third strategy is to invent or produce a product or service that is in high demand. Another is to inherit a lot of money or receive a large settlement of some kind. One way is to marry a wealthy person (e.g., Bill Gates’ wife, Melinda). Would you like to have a million dollars by the time that you retire? There are several ways to become wealthy. Extension Specialist in Financial Resource Management

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