The
book, written by Stanley and Danko, discusses the
difference between being wealthy and earning a high
income, and shows that someone earning a high income
is sometimes caught in a trap of expensive “toys”,
clothes, a large house and a flash car, etc. All of
this is in order to keep up with their colleagues,
next door neighbours etc. It shows how they are in
debt up to the hilt via credit cards and via mortgage
debt and how they live beyond their means. The Millionaires
however are more frugal with their money, they live
below their means and when they get a pay rise, they
invest the additional amount rather than spend more
on a nicer car.
Forget
the Rolex watch, the flash sports car and expensive
suits - the Millionaire Door actually wears $40 shoes
and has never paid more than $25,000 for a car.
“Affluent
people typically follow a lifestyle conducive to accumulating
money, In the course of [our] investigations, we discovered
seven common denominators among those who successfully
build wealth.”
1.
They live well below their means
2. They allocate their time, energy, and money efficiently,
in ways conducive to building wealth
3. They Believe that financial independence is more
important than displaying high social status
4. Their parents did not provide economic outpatient
care
5. Adult children are self sufficient
6. They are proficient in targeting market opportunities
7. They chose the right occupation
"Big
Hat, no Cattle"
Stanley and Danko first heard the expression
"Big Hat, no Cattle" from a Texan. He owned
a very successful business but drove a ten year old
car and wore jeans and a buckskin shirt (classy -
Dan). He lived in a modest house in a lower class
area. The Texan told them “[My] business does
not look pretty. I don’t play the part …
don’t act it … when my British partners
first met me, they thought I was one of the truck
drivers. They looked all over my office, looked at
everyone but me. I don’t own big hats, but I
have a lot of cattle”
Summary:
Highly Recommended. Iwould highly recommend this book,
you will read cover to cover in a short space of time
and by the middle of the book, will help you realise
how easily we waste money on things that (we think)
make us look good, or have a high social status, but
in fact slow or distract us from completing our goals.
As
an investor, its worth noting that being frugal with
your cash is one of the first steps to take in becoming
wealthy and financially free. To learn more about
becoming wealthy, you can join Daniel on one of his
Property Investor Consultancy
days |
