Are you ready to have your perspectives challenged and mindset revitalized? We just finished re-reading The Millionaire Next Door: The Surprising Secrets of America’s Wealthy tonight, and want to share its surprising secrets with you!!

College Mindset as a Millennial

Facebook, Instagram, Twitter, and Snapchat began to revolutionize how we shared our status, our fashion, our attractiveness, and our power.

Following celebrities to see them pictured with foreign whips, private planes, diamond chains, expensive liquor, designer clothes, and beautiful models.  Sitting court side or hanging out in the islands for some relaxation, while secretly promoting expensive clothing for their sponsor deals. A world where those who get the most followers, retweets, likes, or views rule as we show off our latest purchases to build a personal brand of success. A very expensive one…

Award shows…

The Grammy Awards, CMA Awards, The Oscars, BET Awards, and so many many more. The fashion and luxurious lifestyle demonstrates how most wealthy Americans live right? WRONG! From professional athletes to successful actors/actresses, the high-income high consumer lifestyle leads to a much different ending. Bankruptcy!

High spending…

Johnny Depp had 650 MILLION dollars. 650!! He spent on average 2 million a month on regular expenses. His lifestyle eventually caught up with him as he now owes his business managers 5 million from an unpaid loan and 500k in management fees.

Check out the Scribd resource at the end of the post to read the report from his managers. If its true, our respect for Mr. Depp is at an all-time low.

Money decisions…

Many of these stars are renting chains or leasing cars. They splurge on stupid things like throwing money at the club. Throwing money, unfortunately, doesn’t have much of an ROI. We totally don’t recommend it to Duke’s on their journey.


In 2015, Americans spent 13.5 billion, yes BILLION, on plastic surgery. The next generation of our young women aisconstantly putting themselves against standards of the crazy pictures we see in magazines. Magazines use Photoshop with models using fake bodies. Companies are plaguing our culture with fake being better than real. It’s disgusting and it hurts our hearts.

What is one of the most important factors of becoming a millionaire in the US? A supportive spouse, we prefer ours to be real here at the Duke of Dollars castle.


What really makes this heart wrenching is the idolization of these high spenders to our youth. These stars instead could be using this power to positively impact society (some do! Have you heard what Ashton Kutcher has co-founded?). Instead, we see real people making real decisions, most of the time ridiculous ones. Lil Wayne – the role model for aspiring rappers, doesn’t even believe racism exists in America.

WHAT!? Many of these celebrities help our young to see what the lavish life looks like, not what real life actually does. Hurting their futures and that alone is why we hope this blog post helps transform that mindset.

Rant wrap up…

As we begin wrapping up the rant, let us relate this back to the heading – in college the mindset continuously thrown our way was gaining success to obtain the lifestyles window shopped for on TV and music videos. We learn to work feverishly for dreams to buy all that we want. Thankfully, we read this great work and transformed our mindset + our life. Consumption doesn’t equal happiness. The millionaires show us this.

Side note – this post is a long one and will be going in depth through the trans-formative topics from the book mentioned, its without a doubt, worth your time!

It’s time to transform from college to millionaire mindset!!

Purchase the book today to get all of the details we summarized, case studies not mentioned, and graphs/charts not copied!

Let’s get this round table of transformation started!

Book Intro:

“Wealth is not the same as income.” By spending everything one makes, they aren’t accumulating any wealth. To do so takes “hard work, perseverance, planning, and most of all, self-discipline.” Millionaires are not those who make a lot of money, but those who have accumulated a large sum and are financially independent from the money they do earn (sometimes this is through high income). They work on their passions and for the challenge, living frugally to grow wealth to millionaire status as time goes by.

7 Factors of the wealthy

  1. “They live 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. “Their adult children are economically self-sufficient”
  6. “They are proficient in targeting marketing opportunities”
  7. “They chose the right occupation”

The Research

The research for this book was mostly gathered during 1995-1996 by doing the following:

  • “Personal and focus group interviews with more than five hundred millionaires and surveys of more than eleven thousand high-net worth and/or high income respondents”
  • More than 1K people responded to a 249 question survey
  • “Hundred of hours conducting and analyzing in-depth interviews with self-made millionaires…and their advisors.”

1. Meet the Millionaire Next Door

The chapter begins with a quote stating that many of those being interviewed didn’t look or act like Millionaires. The view was that millionaires “own expensive clothes, watches, and other status artifacts.” Their research found otherwise. It’s like the old saying…don’t judge a book by its cover. Why not mother? “Looks can be deceiving.”

The real prototypical millionaire says the following about themselves:

  • “We have an average household net worth of $3.7 million”
  • “…one in five of us is retired. About two-thirds of us who are working are self-employed.”
  • “On average, our total annual realized income is less than 7 percent of our wealth.”
  • “97 percent are home owners”
  • “About 8 percent of us are first-generation affluent”
  • “We live well below our means”
  • “On average, we invest nearly 20 percent of our household realized income each year.”
  • “I am a tightwad”

Definition of Wealth


“People who have an abundance of material possessions”

Thomas and Bill’s:
  • Net worth = assets less liabilities
    • In the book, wealthy is defined as more than 1 million+ net worth
      • only 3.5 million of 100 million households during their study was considered to be wealthy based on this definition

How wealthy should you be / How to determine if you’re wealthy?

Assumption: Income + age = expected higher net worth.

Equation from the book to determine your bench mark:

bench mark = ( (Age * Realized pretax annual household income except inheritance) / 10 ) – inheritance

Example from book:

  • Age: 41
  • Salary: 143K
  • Investment Return: 12K

Bench mark = 155,000 * 41 = $6,355,000 / 10 = $635, 5000


  • Prodigious accumulator of wealth = Net worth is two times your bench mark
  • Under Accumulator of Wealth = Net worth 1/5 of the expected bench mark

The main difference between the two is their ability to accumulate wealth from their income. To do this, one must live below their means and consume less.

Aren’t most millionaires given the wealth from their parents?

Facts of the millionaires studied in the book

  • “Only 19 percent receive any income or wealth of any kind from a trust fund or an estate”
  • “Fewer than 20 percent inherited 10 percent or more of their wealth”
  • “Nearly half never received any college tuition from their parents or other relatives”

The chapter ends with details on the different ancestry groups of the affluent.  The authors give one main reason small population sizes in the US for different ancestries still have a high representation of millionaire status. It’s because they have not been influenced to the consumerism culture yet. They give a few case studies to show the importance of living frugally, and the hard work of immigrants to make it in America leading to accumulated wealth.

2. Frugal Frugal Frugal

  • Definition -> “behavior characterized by or reflecting economy in the use of resources”
  • The opposite -> wasteful. “lifestyle marked with lavish spending and hyper-consumption”

“Being frugal is the cornerstone of wealth-building.” They explain how the media “barrages” us with athletes or big spenders being “promoted by the press.” Many of them couldn’t sustain their high spending life for more than one year without pay. But they make millions, how can this be?

They spend all of the millions they make! The lavish lifestyle sells on TV, magazines, and newspapers. People love celebrities because they think they are the most successful in America – this book’s research transforms that opinion.

The lifestyle of the typical American millionaire

If a typical millionaire was shown on a TV talk show, people wouldn’t it watch. Why? It’s boring! They have the same wife for years, went to a local college for their degree, own a small business, and dress like the average blue collar worker. People would be quite confused. Where’s the Armani suit? Jewelry? They don’t have either.

If the host began questioning his habits for purchases, it would go like this:

“What’s the most you ever spent for a suit of clothing?

  • $399

How much do millionaires spend on shoes they buy?

  • Half of them never spent more than $140
  • One in four never spent more than $100
  • One in ten spent more than $300

Is that what you envisioned? We were shocked first reading this. NBA star Chris Paul has a closet full of Jordan shoes, who would have thought this wasn’t the norm for millionaires? Only “1 percent of the millionaires in our survey paid $667 or more for a pair of shoes.” The award shows with their red carpet fashion displays of the world show otherwise – yet the truth gives all of us more hope to reaching the level of wealth we envision in our lives.

Millionaire - 5 pairs of shoes on a table sorrounded by a closet that has at least 200 pairs of shoes

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How much do millionaires pay for their wristwatches?

  • Half never spent more than $25
  • One in four spent $100 or less
  • One in ten never paid more than $47
Millionare - Two men with their clothes compared side by side. with title above their head. Broke - wearing expensive clothes. Billionaire - wearing cheap simple clothes.

Meme taken from

The show would end with the following quote on:

“I live in a fine home…but have no mortgage. All my children’s college accounts were more than fully funded before they even began attending college.” The millionaire’s boring life style might not sell TV, but it sure does achieve the dreams we want in our lives. Great relationships, no debt, and successful children!

The main reason most high income earners are not wealthy is because they play poor financial defense. “The foundation stone of wealth accumulation is defense, and this defense should be anchored by budgeting and planning.” A lifestyle choice that continues well after becoming a PAW.

A great metaphor used to drive this point from the book – jogging. The people you see jogging every day are the ones who look like they don’t really need to be jogging. Why? Because they are so fit. They are fit because they routinely  run while many others don’t have the discipline to do so. The same can be said for your finances, be financially fit!

Is it possible for a family earning 500K to struggle making ends meet? Check out the financial samurai post to see how it can be a scenario in a very expensive city.

Do you want to become affluent? Can you answer yes honestly to these 4 questions?

  1. “Does your household operate on an annual budget?”
    • About 100 millionaires don’t budget for every 120 that do
      • Those that don’t live in a life of scarcity – meaning they invest first, then spend the rest.
  2. “Do you know how much you family spends each year for food, clothing, and shelter?”
    • Without knowing your expenses, how can you plan to be financially independent? You must know how much you need to live freely on.
  3. “Do you have a clearly defined set of daily, weekly, monthly, annual, and lifetime goals?”
    • For every 100 who answered no, 180 answered yes. The no’s are those who are already retired and accomplished their goals.
    • “Financially independent people are happier than those in their same income/age cohort who are not financially secure.”
  4. “Do you spend a lot of time planning your financial future?”
    • For every 100 no’s, there are 192 yes’s.Those who said no, are the high income with low net worth UAW’s or wealthy retirees.

Millionaires allocate much more time in their weeks to investment decisions than those who are non millionaires. They take time to invest and allow their wealth to grow, it is a priority for them and their future.

Would you really want a UAW’s lifestyle?

A few descriptions of the UAW “Theodore” from the book:

  • Came from a very poor family, but went to a nice school where the rich kids’ cars constantly amazed him. Made the promise to be better off than his parents, which meant displaying wealth to show status
  • Simple money plan – spend when you have, save when you need, use installment loans
  • Ultimate consumer life:
    • owns two boats
    • one jet-ski
    • six automobiles that are either leased or bought on credit
    • Member of two 5k+ country clubs
    • “Owns” a vacation condo
    • Shops at the best stores
    • His income ~221,00 a year, with a benchmark net worth of $1,060,800…but is worth 1/4 less

Sounds like the good life right? Vacation homes, best quality clothes, boats, caviar, and more! It does sound great and looks great too. Internally – it’s not. The high income makes for a great start in your life. Would you be happy working many hours and seeing less of your family just to pay for all the toys you bought? Most likely not. Worst, UAWs do not participate in pension plans, so they struggle to find money to fuel their tank during retirement.

The UAW Process:

Work hard -> earn money -> sacrifice to impress others. He does all of this for others without taking the time for his family and his self to enjoy the little things in life instead.

Can they change?

Of course – if your friend is a UAW then talk to them. If they are willing to change, recommend good professional help or the Duke of Dollars blog :).

How to build wealth:

“Minimize realized (taxable) income and maximize your unrealized income (wealth/capital appreciation w/o cash flow).”

Income tax deters wealth as it is the highest expense for most households in the US. Its a tax on your income, not on your wealth. On average, millionaires spend only a bit over 2 percent of their wealth each year in their annual taxes. Typical Americans? “More than 10 percent.”

Mortgage rule of thumb – “If you’re not yet wealthy but want to be someday, never purchase a home that requires a mortgage that is more than twice your household’s total annual realized income.”

3. Time, Energy, and Money

“People who become wealthy allocate their time, energy, and money in ways consistent with enhancing their net worth. PAWs spent nearly 2x more hours planning investments than UAWs.”

The book uses a case study format to compare two different doctors:


Dr. South (UAW)Dr. North (PAW)
Married with 4 children in his fiftiesSimilar age and family composition as Dr. South
Earned more than $700,000, but declining net worth of 400KAlso earned more than $700,000, increasing net worth of 7.5 million
Invest little...why? Consume as much as people with 2x their net worth
- Spends 30K on clothing, 72K on vehicles, 107K on mortgage, and 50K on club dues
Invests at least 1/3 of his pretax By consuming less than they earn
- Spends 9K on clothing, 12K on vehicles, 15K on mortgage, and 8K on club dues
3 hours a month spent on financial investment planning10 hours a month spent on financial investment planning

Both doctors are in the top 99.5 percentile of all income earners in America, yet as you can see their lifestyles and wealth are so so so so so different. It is much better life to focus on being a great person, building relationships with the people you love, and building wealth. Focusing on impressing others leads to unhappiness and debt. Which do you choose? Transform today fellow dukes!!

Car Shopping:

“There is an inverse relationship between the time spent purchasing luxury items such as cars and clothes, and the time spent planning one’s financial future.”

“Most millionaires we have interviewed never in their life spent near $65,000 for an automobile.”

Dr. South (UAW)

The gist of this section goes like this. UAWs spend incredible amounts of time to learn about all of the dealers in the area and shop around for months to get the best deal. He contacts dealers and puts them against each other for price until he finally gets the dealer price for his purchase. They believe in being a very smart buyer, when in actuality they are spending more time learning about dealerships (around 60 hours) than planning their financial futures.

If we use a gross income estimates, based on earning 700K a year, he makes 336.53 an hour. He wasted 23K searching for a car.

Millionaire - A silver porche 911 on a white background

Image from

Dr. North (PAW):

  1. Decided he needed a new car, and knew that European luxury cars depreciate in the first 3 years…confirmed by price checking
  2. Visited local dealer to confirm if a 3 year old model is best for him
  3. Telephoned dealers to let him know he was interested, then bought the car when they got them in with a good deal

He purchased a nice car, in less time, and much less money. UAWs who purchase new cars every 3 years subsidize the brunt of the payment years, then PAWs move in.

Millionaire - Picture of a 2014 Mercedez Benz to demonstrate buying a 3 year old luxury vehicle

Image from

Taxes and Government:

Four fears expressed by Dr. South (UAW):

  1. “Paying increasingly high federal income taxes”
    • Both fear that the gov is likely to increase high income producers to pay more taxes
    • If the tax rate doubles, Dr. South would be worried. More taxes paid = less income to pay off his debts each month
  2. “Increased government spending and the federal deficit”
    • Increased spending by the gov = higher taxes
  3. “High rate of inflation”
    • Increased spending and increase in deficit means increase in inflation
  4. “Increased government regulation of business and industry”
    • This could effect the income they receive from their practices

Active or Inactive Trader?

“Fewer than one in ten millionaires are ‘active investors.’ Most hold their investments for at least 6 years, see our investing philosophies if interested in being a Duke! According to the authors, millionaires spend time understanding smaller markets and become experts on smaller offerings, meaning they can make better decisions on the investments they buy.

Millionaires can and do use trusted financial advisors – we recommend taking a look at our review, Tony Robbin’s book Unshakeable, to see how to choose one for yourself if interested!

4. You Aren’t What You Drive

This chapter reiterates a lot of the observations we have talked through, along with a few case studies to demonstrate. If your interested in reading the case studies, then definitely check out the book.

Highlights we want to convey:

One millionaire was gifted a Rolls-Royce, he asked for it to be returned. Some would be shocked at this, let us quote his reasons:

“There’s nothing the Rolls-Royce represents that’s important in my life. Nor would I want to have to change my life…I can’t throw fish in the back seat of the Rolls…I’m out fishing here every weekend…With a Rolls, I can’t go to some of the crummy restaurants I enjoy going to…Can’t drive up in a Rolls-Royce…There are some things that are more fun to do…more interesting to do [than owning a Rolls].”

Again, the mindset of the real wealthy in America contraries popular belief of needing status in life. Status doesn’t do anything for you – it turns people fake around you, makes people see you as a bank account, and reduces your checking account balance.

5. Economic Outpatient Care

There are two sections that go into heavy detail on the reasons affluent parents should not make life easy through financial gifts to their heirs. Those who get this Economic Outpatient Care never learn the same grind their parents have, thus never becoming independent either. We must teach our children to fish instead of sponsoring their bad financial decisions. UAWs produce UAWs and PAWs produce PAWs by teaching values they believe in. We won’t go into more details here, as it falls out of the scope of your mindset to building your kingdom!

One SN – this books dives into the details of woman during this time period not being pushed into growing their own career or financial freedom, instead they were encouraged to use their parents money and find a husband who earns a high income. We support anyone who wants to pursue their dream and live the life they choose. We don’t support anyone being forced to do anything they don’t want to by their parents. Be you, be great, and be financially responsible!

Find Your Niche

Are you asking yourself now, why am I not wealthy? Consider finding a niche that affluent people spend their money for. Many times people create businesses targeting customers without the money to buy it.

The book details professions and business opportunities they believe best fit niches that can have the affluent as customers. For example, estate attorneys or orthodontist. Since this book is a bit dated, the recommendations should be dived into deeper to find niches for the technology age. See our building income article for a good first step!

Jobs: Millionaires versus Heirs

Millionaires recommend professions to their children instead of self employment. Why? Its more risky. “They can take your business, but they can’t take your intellect!”

Many self made entrepreneurs were unable to afford college and the profession they encourage their children to work in. They want stable and wealthy lives for their children. Who doesn’t!? Freedom for their children without risk is their philosophy on this. We are living in a time where silicon valley and the start up world has developed products that made them tons of money. Internet businesses are started every day. Duke of Dollars is run as a passion from authors with full time jobs. Our mission is to enrich the lives of others to live a great life!!

Millionaire - Picture of Google's corporate building in California.

Image from

Concluding Thoughts:

This book transformed one of our Master Duke’s life, recently reaching a milestone of his own! Our authors truly believe the mindset of appreciating the little things, enjoying life’s experiences, and growing our healthy relationships make life worth living. Consumerism and the good things of life can help, and should only be enjoyed if you can truly afford and moderate them throughout your journey. Let the media do their thing and keep your eyes on the real prize. A wealthy life towards financial freedom: one where you are judged by what you do, not by what you wear or buy. When you’re surrounded by people who care who you are, not by what you have, then you already have a millionaire life with everything you need.

What is your mindset? Let us know what you think by leaving a comment below! Want to transform the mindset of your friends and family? Share this on social media!


Disclaimer – affiliate links are used for the purchase of the book above.