The Millionaire Next Door is one of the best business book I’ve ever read.
It carries a very inspirational message: anyone can become financially independent (=wealthy) having earned just an average income for their entire life.
The Millionaire Next Door secret is to limit personal spending and keep investing a portion of income.
To build wealth, minimise your realized (taxable) income and maximise your unrealized income (wealth/capital appreciation without a cash flow).
Very short excerpt from the book:
Who becomes wealthy?
- They live well below their means.
- They are compulsive savers and investors.
- They believe that financial independence is more important than displaying high social status.
- They are proficient in targeting market opportunities.
- They chose the right occupation.
- They have made their money on their own.
80% of America’s millionaires are first-generation rich.
I highly recommend reading this book to everyone. It breaks every stereotype commonly associated with the perception of ‘wealthy people’.