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What Happened to The Millionaire Next Door?

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When I was a younger man, back in the 1990s, there were a lot of self-help and motivational speaker publications. One book that was very popular with anyone interested in finance in ‘96 was The Millionaire Next Door by Thomas J. Stanley. For those of you who are too young to remember or never read the book in the first place, here’s the deal: The book was published in the mid-90s and served up a humbling revelation: the real millionaires weren’t the flashy big spenders driving Ferraris, but they were the unassuming neighbors mowing their lawns and buying off-brand peanut butter.

Today, this concept isn’t the biggest revelation. However, in the mid-90s, especially after the 1980s, people still envisioned millionaires as flashy Gordon Gekkos, so this book offered a perspective on accumulating wealth that not everyone was aware of.

The book dismantled the idea that true wealth is about show and flash and instead spotlighted thrift, hard work, and financial discipline. It struck a chord in the era of pre-dot-com boom optimism when the “get rich quick” mantras were not viewed in the most positive or ethical light. To put it plainly, the book had a “be boring, get rich” mantra; it became a wake-up call for many who weren’t thinking of their finances that way.

The book was fun, inspirational, and somewhat guilt-inducing when it made everyone realize how recklessly they were spending. Overall, it promotes a balanced financial perspective, but some feel it goes too far with its squeeze-every-penny ideology. Like all things in life, I believe there’s a balance to be found in the middle. 

Where’s the Millionaire Next Door in 2024?

One way or the other, I got thinking about The Millionaire Next Door almost 30 years after the book’s release. I thought what a fun exercise it would be to visit two different types of millionaires in 2024 and see how they’ve fared being millionaires since 1996—one living a lavish lifestyle and the other living under Stanley’s guidelines. Let’s check in with our neighbors.

  • The Steady and Secure Millionaire 28 Years Later

The steady and secure millionaire neighbor has stuck to their principles. They’ve avoided lifestyle creep, kept their spending in check, and invested consistently. They retired at age 60 and lived comfortably on a small pension and eventually Social Security. By 2024, their balanced 60/40 portfolio, started in the 90s, has grown to a respectable $5 million, assuming average market returns. They live in a modest $500,000 home, drive a reliable car, and have no debt. While they’re not making headlines by dating supermodels or flaunting wealth on Facebook, they’re financially secure; nothing is causing them to lose much sleep regarding financial planning.

They budget for the occasional splurge—family vacations, good coffee, and dinners out—they’re mostly not skipping the memories or the coffee. Their careful planning has given them the freedom to live comfortably without worry, and they’re confident in their retirement plans

However, this steady and secure millionaire is not flawless. Like many clients I’ve worked with, they’ve retired great savers but horrible spenders. Their first withdrawal is when they reach the RMD (required minimum distribution) age. They are used to spending nothing and suddenly are required to withdraw $250k from a taxable account. Perhaps all these savings could have been used for fun, care, or needs before or earlier in retirement during the “go-go” years. 

  • The Big House, Bigger Bills Millionaire, 28 Years Later

The flashy millionaire of the 1990s has taken a very different route. They live in a $2 million house with a hefty mortgage and drive a luxury sports car financed with a six-year loan. Their wealth is tied up in assets, but much of it is offset by debt. On paper, they’re worth a million dollars, but their net worth is a fragile balance of equity and liabilities.

They’ve prioritized appearances and a high-cost lifestyle, but it’s come at a cost. Their savings rate is low, and while they’ve invested some money, their portfolio hasn’t grown as much as it could have. They might post photos of luxurious places and things, but behind the scenes, they feel the pressure of high expenses and rising interest rates. Their retirement number? It’s a looming question mark. The small pension and Social Security allowance were not enough to live on, and instead of growing their accounts, they have been spending them down.

Cutting Your Own Path

Comparing yourself to others—whether it’s the steady millionaire or the flashy one—is like envying photos of a tropical vacation without considering what’s going on behind the scenes. I always reinforce this with my clients: focus on your goals, not someone else’s highlight reel. A well-balanced financial plan can give you the security to enjoy life without overindulging or stressing about every dollar. Yes, not all of us can be like the millionaire next door, but with guidance, we can each cut our own path that leads to a desired direction. 

Today, the lesson of The Millionaire Next Door remains relevant: wealth comes from consistent, disciplined habits. But,  it’s okay to spend a little—on $5 coffees or tickets to a concert. The goal isn’t to hoard every dollar until you’re too old to enjoy it; it’s to create a life that balances security with joy. What if you finish retirement with more than you started and still make lasting memories with loved ones? Is that not the ultimate goal?

Some Perspectives on Inflation

Because it’s constantly in our minds, I wanted to share some thoughts on inflation. While inflation feels like an ever-present challenge, its long-term effects can be mitigated by good planning. Sure, eggs might cost as much as a fancy coffee now, but long-term investment growth often outpaces inflation. 

The real danger isn’t inflation itself; it’s failing to adapt to a changing financial landscape and not course-correcting when you should; this is why I began my career as a family financial planner, to keep families on track and out of unnecessary risks. 

Remember, my door is always open. Cheers to a new year of opportunity, understanding, and living with intention. 

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