Books by Thomas J. Stanley
The Millionaire Next Door is the Thomas J. Stanley book in our library, written with William D. Danko. It is the most empirical book in this bundle: it went and looked at who wealthy households actually are, and the answer contradicted what most people assume.
What it found is that visible spending and actual wealth often run in opposite directions. That is a more uncomfortable finding than it sounds, because it means the signals most people use to identify success are unreliable, and it also means the book asks something of the reader rather than telling them a story.
How to read it. Read it after Rich Dad Poor Dad. The two books want different things from you, and the disagreement between them is the interesting part rather than a problem.
It sits in the Personal Finance bundle as the evidence book of the set. Read it against the others rather than alongside them, because its findings do not fit their framing very comfortably.
The book
The Millionaire Next Door: The Surprising Secrets of America's Wealthy
Thomas J. Stanley and William D. DankoWealth measured rather than imagined. The finding that visible consumption and actual wealth are often inversely related is the one that survives every re-telling, and it is based on data rather than on cases. It is the least rhetorical book on this shelf.
What it argues- Most wealthy households do not look wealthy, and most visible spending is not wealth.
- Income and wealth are different things, and the gap between them is behaviour.
- Frugality is a feature of wealth accumulation rather than a leftover habit.
- Supporting adult children financially is associated with lower wealth in the children.
- The signals people read for success are poorly correlated with it.
Suited to a reader who wants evidence rather than encouragement, and to anyone who has been measuring themselves against visible spending. The most empirical book in this bundle, and the least comforting.
Where to start
Read the chapters on what wealthy households actually spend and own before the ones on the survey method. The point worth taking is the gap between how wealth looks and what it is, which you can test against people you know. If that gap is uncomfortable to notice, that is the part of the book doing its work, and it is more useful than any of the numbers in it.
Where this fits
This is the evidence book of the shelf. Rich Dad Poor Dad supplies the framing it contradicts, The Psychology of Money explains why the behaviour is so hard to hold, and Think and Grow Rich is the ancestor all four are answering. Read it after Rich Dad Poor Dad, because the disagreement between those two is the most useful thing on this shelf.
The rest of this shelf
The Personal Finance shelf holds 5 books in total. These are the others, each condensed into a guide you can finish in about 15 minutes:
- The Psychology of Money: Timeless Lessons on Wealth, Greed, and Happiness by Morgan Housel
- Rich Dad Poor Dad: What the Rich Teach Their Kids About Money That the Poor and Middle Class Do Not! by Robert T. Kiyosaki
- Think and Grow Rich by Napoleon Hill
- Money: Master the Game: 7 Simple Steps to Financial Freedom by Tony Robbins
The evidence, plus four more
The Millionaire Next Door is in the Personal Finance bundle with The Psychology of Money, Rich Dad Poor Dad, Think and Grow Rich and Money: Master the Game.
Five complete guides, about 15 minutes each.
Explore Personal FinanceVisible spending and actual wealth often move in opposite directions.