Law of Success (21st Century Edition)

276 THE PRINCIPLES OF SELF-MASTERY

COMMENTARY

Though some people spend a great deal of money, it does not mean they are rich.

In The Millionaire Next Door, Thomas J. Stanley and William Danko reveal that

spending is something most wealthy people avoid. Their research shows that:

• More than 80 percent of America's millionaires accumulated their own
  wealth-they did not inherit it.


• Most millionaires do not live in fancy neighborhoods but in the houses they
  owned when they began to accumulate their fortunes.


• Most millionaires drive mid-size American cars, not fancy imports, and
  one out of three of them always buys used cars.


• The average millionaire has an income of just over $130, ODD-their real
  wealth comes from their habit of saving 20 percent of their income.
  In short, most millionaires are not actors or Fortune 500 CEOs or athletes
  pulling down millions of dollars a season. They are people earning good but not
  fantastic incomes, who have made a habit of saving.

HOW MUCH SHOULD YOU SAVE?

The question of how much a person should save cannot be answered
in a few words, for the amount each should save depends upon many
conditions, some of which may be within one's control and some of
which may not be.
Generally speaking, a salaried worker should apportion his or her
income about as follows:

Savings Account

Living: Clothes, Food, and Shelter

Education

Recreation

20 percent

50 percent

10 percent

10 percent