Dr. Thomas J. Stanley thoroughly researched wealth-building behaviors and revealed the results in The Millionaire Next Door.
In his 1990s survey of over 14,000 affluent American households,
Stanley concluded that households can become wealthy without six- or
seven-figure salaries.
Dr. Stanley passed away in a car accident in 2015, and his daughter Dr. Sarah Stanley Fallaw recently published The Next Millionaire Next Door.
Dr. Fallaw confirms that many of the behaviors identified in Stanley’s
research continue to play a significant role in wealth accumulation
now, and behavior change is possible.
She finds that frugality, diligence, hard work and time management
are more important than salary alone. Choice of spouse, career and
location are also influential.
Habit No. 1: Frugality
Frugality means you spend less than you earn. Most millionaires are able to ignore the temptation to buy a bigger house, newer car, latest tech gadget and so on. They may notice what other people are buying but don’t go on a shopping spree themselves.
Habit No. 2: Discipline
Self-made millionaires are also disciplined. They choose moderation over extremes. If they buy a luxury car, it’s often a used one. You’re unlikely to find them living in the most expensive, elaborate house on the block. As investors, many millionaires don’t try to time the market. Slow and steady wins the race.
Habit No. 3: Hard Work
Another defining characteristic of many millionaires is their work ethic. Money wasn’t handed to them on a silver platter. It’s incredibly difficult to build long-term wealth yourself if you’ve relied solely on handouts from parents or other family members. The adage “from shirtsleeves to shirtsleeves in three generations” rings true: A sense of entitlement quickly erodes family wealth. Millionaires profiled in Dr. Fallaw’s book are willing to roll up their sleeves, launch businesses or stick it out in high-paying careers until they’re financially independent.
Habit: No. 4: Time Management
Effective allocation of time, energy and resources is another guiding trait of self-made millionaires. Even if hiring an outside financial adviser, a millionaire still monitors the family budget and ensures the investment portfolio matches the level of risk taken. He or she takes the role as household CFO seriously but may also rely on a professional with deep expertise in tax mitigation, charitable giving or college saving strategies.
Monday, February 04, 2019
Friday, February 01, 2019
wealth inequality grows
DAVOS, Switzerland — Wealth inequality around the world is
“out of control” and doing particular harm to women, anti-poverty
campaigner Oxfam warned Monday ahead of the annual gathering of business
and political leaders in the Swiss ski resort of Davos.
Oxfam, which has for years been trying to bring attention to the issue ahead of the World Economic Forum, said in a report that billionaire fortunes increased by 12 percent last year — the equivalent of $2.5 billion a day — while the 3.8 billion people who make up the world’s poorest half saw their wealth decline by 11 percent.
“This is not inevitable, this is unacceptable,” Winnie Byanyima, Oxfam International’s executive director said in an interview with The Associated Press.
In the report, which is based on figures from Credit Suisse’ Wealth Databook and the annual Forbes “Billionaires List,” Oxfam said the number of billionaires has almost doubled since the financial crisis a decade ago yet tax rates on the wealthy and corporations have fallen to their lowest levels in decades.
“While corporations and the super-rich enjoy low tax bills, millions of girls are denied a decent education and women are dying for lack of maternity care,” Byanyima said.
Oxfam said making taxes fairer will help address many of the world’s ills. It said getting the world’s richest 1 percent to pay just 0.5 percent extra tax on their wealth could raise more money than it would cost to educate the 262 million children out of school, and provide life-saving healthcare for 3.3 million people. It also suggested governments look again at taxes on wealth such as inheritance or property, which have been reduced or eliminated in much of the developed world and barely implemented in the developing world.
“Governments must now deliver real change by ensuring corporations and wealthy individuals pay their fair share of tax and investing this money in free healthcare and education that meets the needs of everyone — including women and girls whose needs are so often overlooked,” said Byanyima.
Byanyima, who has been a regular participant at the Davos gathering, defended the organization’s continued participation at the World Economic Forum despite mounting evidence of growing inequality.
Byanyima said “the people in Davos” have the power to be “the solution to end extreme inequality.”
“The solutions are there and that is why we come to Davos, to remind these leaders that you have made the commitment; now get on with the action. The policies are there, the solutions are proven.”
Oxfam, which has for years been trying to bring attention to the issue ahead of the World Economic Forum, said in a report that billionaire fortunes increased by 12 percent last year — the equivalent of $2.5 billion a day — while the 3.8 billion people who make up the world’s poorest half saw their wealth decline by 11 percent.
“This is not inevitable, this is unacceptable,” Winnie Byanyima, Oxfam International’s executive director said in an interview with The Associated Press.
In the report, which is based on figures from Credit Suisse’ Wealth Databook and the annual Forbes “Billionaires List,” Oxfam said the number of billionaires has almost doubled since the financial crisis a decade ago yet tax rates on the wealthy and corporations have fallen to their lowest levels in decades.
“While corporations and the super-rich enjoy low tax bills, millions of girls are denied a decent education and women are dying for lack of maternity care,” Byanyima said.
Oxfam said making taxes fairer will help address many of the world’s ills. It said getting the world’s richest 1 percent to pay just 0.5 percent extra tax on their wealth could raise more money than it would cost to educate the 262 million children out of school, and provide life-saving healthcare for 3.3 million people. It also suggested governments look again at taxes on wealth such as inheritance or property, which have been reduced or eliminated in much of the developed world and barely implemented in the developing world.
“Governments must now deliver real change by ensuring corporations and wealthy individuals pay their fair share of tax and investing this money in free healthcare and education that meets the needs of everyone — including women and girls whose needs are so often overlooked,” said Byanyima.
Byanyima, who has been a regular participant at the Davos gathering, defended the organization’s continued participation at the World Economic Forum despite mounting evidence of growing inequality.
Byanyima said “the people in Davos” have the power to be “the solution to end extreme inequality.”
“The solutions are there and that is why we come to Davos, to remind these leaders that you have made the commitment; now get on with the action. The policies are there, the solutions are proven.”