The Millionaire Next Door

Not a bad book, but it did have a tendency to beat a dead horse to make a point.

The authors sort everyone into two categories - either you're a PAW (prodigous accumulator of wealth) or a UAW (under accumulator of wealth). I tend to disagree with this binary categorization of people but can look past it for the point of the book. PAWs save money (play good offense, play good defense), UAWs are posers who want to look rich (play good offense, play terrible defense).

The book does present a neat and tidy formula:

(Income * 10%) * age = expected net worth
Actual Net Worth / Expected = % of scale

0 to 1 you're UAW
1 to 2 you're average
2+ you're a PAW

Sounds good, but as many people online have pointed out, it's really only good for people in their 50s+

The authors do seem to have some credibility, having performed most of the polling themselves, they are just a bit too number heavy in their presentation and it lead them to belabor the very simple point that if you live below your means and invest you'll accumulate wealth.

Another salient point the book seemed to beat home is that most millionaires are entrepreneurs and own their own business and play good defense, or are high wage earners (doctors, lawyers, etc) who play great defense with their money. Clearly for most people entrepreneurship is the way to go.

The book kind of meanders on, and spends way too much time on how millionaires shop for cars, how they provide too many gifts for their children, etc. It's pretty worthless information and just seemed to be trying to pad out the book.

Spend less than you make, live below your means, don't fall for high status symbols, and try to start a business.