Book Review: ‘The Next Millionaire Next Door’

Updated on January 30, 2020
tamarawilhite profile image

Tamara Wilhite is a technical writer, industrial engineer, mother of two, and published sci-fi and horror author.

Introduction

“The Next Millionaire Next Door” is a repeat of the landmark study from the classic book “The Millionaire Next Door”. Written by Thomas J. Stanley and his daughter Dr. Sarah Stanley Fallaw, it provides insight into the original work, addresses criticisms of it and a whole new data set.

Yet the “next” millionaire next door book is not just an analysis of the original. It contains new information, and it builds on related works by others that borrow from the original millionaire next door book.

Scanned copy of the book cover for "The Next Millionaire Next Door"
Scanned copy of the book cover for "The Next Millionaire Next Door" | Source

How Does “The Next Millionaire Next Door” Compare to the Original?

“The Next Millionaire Next Door” asks many of the same questions as the first study of actual millionaires while adding a few new ones. For example, there are updated tables on big ticket spending and more information on how people use their time. The “next” millionaire next door book also analyzes the shift in the millionaire population over the intervening twenty years. What jobs do they hold?

The data in this book is mostly from 2015-2016. That means it is the first “Millionaire Next Door” book to analyze the impact of social media on spending and consumption. Yet it is your home purchase and the community you’re living in that has the biggest impact on spending. While we’re depressed by what we see on social media, we’re still spending to keep up with the Joneses next door.

You learn additional information about the average millionaire next door such as marital status, education levels and their investment strategy. More millionaires are divorced and re-married, but most are married. And you find out that a majority had “supportive” home environments, though this isn’t necessary to become wealthy. The findings here tie in to Rachel Cruze’s book “Smart Money, Smart Kids”. I think “The Next Millionaire Next Door” provides a better action plan and higher level overview of why that’s the right way to teach your kids to save, control spending, plan for the future and invest.

The key ingredients remain living below your means and saving and investing the difference. Fewer millionaires are small business owners, and more are 401K millionaires.

“The Next Millionaire Next Door” addresses a number of myths and confusing contradictions the prior version didn’t. For example, it lists the job titles correlated with high income, though this may not be related to net worth. And it discusses some of the high income jobs that make it almost impossible to build a large net worth.

Interestingly, the book addresses criticisms of the original. The data shows that their findings were not affected by the Dot Com bubble or the real estate bubble, though one updated version of the classic book said to take your home out of your net worth calculation. They validate the original rules of thumb such as how much your net worth should be based on age and income and how much you should spend on your house.

How Does “The Next Millionaire Next Door” Relate to “Everyday Millionaires”?

Chris Hogan’s book “Everyday Millionaires” was advertised as the follow-up to “The Millionaire Next Door”. It became a best seller based on that premise. I own a copy of it, too. Yet I didn’t know that “The Next Millionaire Next Door” had come out, though the original book sits on my bookshelf, too.

Dr. Sarah Stanley Fallaw’s book actually references Dave Ramsey a number of times. In their follow-up study, many of the millionaires cited Dave Ramsey’s plan for getting out of debt and building wealth.

“The Next Millionaire Next Door” does a better job in my opinion in providing the hard data dispelling myths about millionaires such as “they inherited all their money”, “they took crazy risks in the stock market” or “they’re lucky”. Chris Hogan’s book “Everyday Millionaires” is better at spelling out these myths, discussing why we believe them and why they’re incorrect without getting down into the weeds, or in this case, data tables. “The Next Millionaire Next Door” addresses some myths Chris Hogan doesn’t like “the rich don’t pay their fair share” or “the rich exploit others”.

Source

Summary

“The Next Millionaire Next Door” is a good follow-up to the original book, “The Millionaire Next Door”. You can learn a lot from it if you read “Everyday Millionaires” or any of Dave Ramsey’s books. If you haven’t read any of those books, “The Next Millionaire Next Door” should be next on your reading list.

Questions & Answers

    © 2020 Tamara Wilhite

    Comments

    Submit a Comment
    • raymondphilippe profile image

      Raymond Philippe 

      2 weeks ago from The Netherlands

      Thanks for sharing this book review. I wasn’t familiar with any of the titles you mentioned.

    working

    This website uses cookies

    As a user in the EEA, your approval is needed on a few things. To provide a better website experience, owlcation.com uses cookies (and other similar technologies) and may collect, process, and share personal data. Please choose which areas of our service you consent to our doing so.

    For more information on managing or withdrawing consents and how we handle data, visit our Privacy Policy at: https://maven.io/company/pages/privacy

    Show Details
    Necessary
    HubPages Device IDThis is used to identify particular browsers or devices when the access the service, and is used for security reasons.
    LoginThis is necessary to sign in to the HubPages Service.
    Google RecaptchaThis is used to prevent bots and spam. (Privacy Policy)
    AkismetThis is used to detect comment spam. (Privacy Policy)
    HubPages Google AnalyticsThis is used to provide data on traffic to our website, all personally identifyable data is anonymized. (Privacy Policy)
    HubPages Traffic PixelThis is used to collect data on traffic to articles and other pages on our site. Unless you are signed in to a HubPages account, all personally identifiable information is anonymized.
    Amazon Web ServicesThis is a cloud services platform that we used to host our service. (Privacy Policy)
    CloudflareThis is a cloud CDN service that we use to efficiently deliver files required for our service to operate such as javascript, cascading style sheets, images, and videos. (Privacy Policy)
    Google Hosted LibrariesJavascript software libraries such as jQuery are loaded at endpoints on the googleapis.com or gstatic.com domains, for performance and efficiency reasons. (Privacy Policy)
    Features
    Google Custom SearchThis is feature allows you to search the site. (Privacy Policy)
    Google MapsSome articles have Google Maps embedded in them. (Privacy Policy)
    Google ChartsThis is used to display charts and graphs on articles and the author center. (Privacy Policy)
    Google AdSense Host APIThis service allows you to sign up for or associate a Google AdSense account with HubPages, so that you can earn money from ads on your articles. No data is shared unless you engage with this feature. (Privacy Policy)
    Google YouTubeSome articles have YouTube videos embedded in them. (Privacy Policy)
    VimeoSome articles have Vimeo videos embedded in them. (Privacy Policy)
    PaypalThis is used for a registered author who enrolls in the HubPages Earnings program and requests to be paid via PayPal. No data is shared with Paypal unless you engage with this feature. (Privacy Policy)
    Facebook LoginYou can use this to streamline signing up for, or signing in to your Hubpages account. No data is shared with Facebook unless you engage with this feature. (Privacy Policy)
    MavenThis supports the Maven widget and search functionality. (Privacy Policy)
    Marketing
    Google AdSenseThis is an ad network. (Privacy Policy)
    Google DoubleClickGoogle provides ad serving technology and runs an ad network. (Privacy Policy)
    Index ExchangeThis is an ad network. (Privacy Policy)
    SovrnThis is an ad network. (Privacy Policy)
    Facebook AdsThis is an ad network. (Privacy Policy)
    Amazon Unified Ad MarketplaceThis is an ad network. (Privacy Policy)
    AppNexusThis is an ad network. (Privacy Policy)
    OpenxThis is an ad network. (Privacy Policy)
    Rubicon ProjectThis is an ad network. (Privacy Policy)
    TripleLiftThis is an ad network. (Privacy Policy)
    Say MediaWe partner with Say Media to deliver ad campaigns on our sites. (Privacy Policy)
    Remarketing PixelsWe may use remarketing pixels from advertising networks such as Google AdWords, Bing Ads, and Facebook in order to advertise the HubPages Service to people that have visited our sites.
    Conversion Tracking PixelsWe may use conversion tracking pixels from advertising networks such as Google AdWords, Bing Ads, and Facebook in order to identify when an advertisement has successfully resulted in the desired action, such as signing up for the HubPages Service or publishing an article on the HubPages Service.
    Statistics
    Author Google AnalyticsThis is used to provide traffic data and reports to the authors of articles on the HubPages Service. (Privacy Policy)
    ComscoreComScore is a media measurement and analytics company providing marketing data and analytics to enterprises, media and advertising agencies, and publishers. Non-consent will result in ComScore only processing obfuscated personal data. (Privacy Policy)
    Amazon Tracking PixelSome articles display amazon products as part of the Amazon Affiliate program, this pixel provides traffic statistics for those products (Privacy Policy)
    ClickscoThis is a data management platform studying reader behavior (Privacy Policy)