The Millionaire Next Door

I'm struggling to know what to write about The Millionaire Next Door.

It's got many wonderful traits, and I strongly recommend that you read it (I wouldn't mention it otherwise) but it's got some flaws. I'm afraid if I focus on the flaws, I'll turn people off from it that might otherwise read it, but if I don't, I'll do readers a disservice.

So, here we go:

Read The Millionaire Next Door because:

  • Most of us have an incorrect perception of what it looks like to be a millionaire, and that colors our thinking about wealth. (Hint: the "average" millionaire looks pretty unremarkable.)
  • The book will hopefully inspire some self-evaluation in new ways. (It did for me)
  • You might finish the book with a new appreciation for financial independence, rather than making a certain amount of money. (Hint: financial independence requires a lot of money, but not nearly as much as most people might think.)
  • It's an engaging read

If you read it, be careful because:

  • Survivorship bias is all over this book. They interview millionaires, and then look for common threads. There may be a large group of people out there who did most of the same things and are not millionaires. This group will never be counted.
  • The book seems a bit too trusting in some ways. Easy example is it's way easier to be a millionaire today than it was in 2000, because the value of the dollar has sunk considerably. So the bar is getting lower and lower, and understates the significance of the achievements of a self-made millionaire in the 1980s.

Here's the link again: The Millionaire Next Door: The Surprising Secrets of America's Wealthy