The bestselling book “The Millionaire Next Door” by Thomas Stanley and William Danko identifies some common traits shared by many people who have been successful building wealth using the get rich slowly strategy. Here are some of the important traits common to many of the millionaires next door:
- They set goals. They plan and work toward their financial goals. They have a clear vision of what they want and take the necessary steps to get there.
- They actively save and invest. They utilize their workplace retirement plan and/or other investment opportunities. They understand the importance of paying themselves first in order to build wealth.
- They maintained stable employment. Research shows that many of the wealthiest retirees stayed with one employer for 30 to 40 years. Staying with the same company can offer big rewards, including a very nice ending salary, significant pension benefits and hefty 401(k) balances. You don’t have to be in a high-powered, fast-paced career to be wealthy.
- They ask for advice and surround themselves with experts. Wealthy retirees don’t do their own taxes and aren’t DIY investors. They know what their strengths are, and if their strengths don’t lie in investing, taxes and financial planning, they leave it up to the experts.
- They protect their credit score. They guard their score closely in order to enjoy lower interest rates on major purchases (i.e. mortgages and car loans). They also do this by limiting their debt to income ratio.
- They often have multiple sources of income. Wealthy retirees may secure several income sources. Those sources tend to be a combination of Social Security, pension, part-time work, passive income (like rentals), other government benefits, and investment income (including retirement plans).
- They are cautious about their spending. They are generally under consumers – they often drive older cars, live in modest homes, and spend less than they make.
- They are not wasteful. Wealthy retirees don’t pay for things they no longer use, such as cable subscriptions and club memberships. They also follow a budget to stay on track.
- Most importantly, they believe patience is a virtue. They understand that wealth builds gradually and will accumulate through diligent saving, investing, and budgeting over multiple decades.
Aldrich Wealth LP helps our clients protect and grow their financial assets for the future, by helping them make smart financial decisions today. If you would like assistance in determining your retirement needs, please contact us or call Aldrich Wealth at 888-299-3102 to speak with a financial advisor.
Meet the Author
Partner, Director of Corporate Retirement Plans
Heather Wonderly, AIF®, CPFA
Heather has been working in the investment field since 2000. She provides guidance to 401(k) pension committees, helping them understand investments, compliance, fiduciary responsibility, and administration for corporate retirement plans. She also provides ongoing employee education to plan participants. She holds an Accredited Investment Fiduciary® and Certified Plan Fiduciary Advisor credentials and has also completed the…
- Certified Plan Fiduciary Advisor
- Series 7 and Series 66 security exams
- Accredited Investment Fiduciary®
- Corporate retirement plans