Fifteen years ago, Thomas Stanley and William Danko published The Millionaire Next Door: The Surprising Secrets of America's Wealthy. It was an instant bestseller, and today, there are more than two million copies in print. According to one of the authors, with whom I recently spoke, the lessons of the book hold firm, including that the identity of the person in your neighborhood with the highest net worth could come as a surprise. It might not be the private equity trader down the street. Or the doctor or lawyer up the block.
"The consistent finding that I have had for the last 30 years is that most who are wealthy are business owners, often of blue-collar businesses, that most others have ignored," Stanley told me.
Think janitorial. Or scrap metal (now "recycling"). And dry cleaning, especially the industrial variety. It's the successful owners and operators of such unglamorous businesses who have often been able to make money in one generation.
Stanley told me that these entrepreneurs tend to be more frugal than others of the same age and income. For example, his research shows that they typically live in areas where they have "five, 10, or 25 times more wealth than their neighbors." The median value of their homes? In the "low to mid-$400,000 range." And those homes are highly concentrated in the Midwest and the South, not in California or the Northeast, where, he said, you actually have the lowest probability of becoming a millionaire.
Another fascinating detail is what you are likely to find parked in the driveway of the millionaire next door: a Ford or Toyota. According to Stanley, the median price for a millionaire to spend on a car is $31,000, and most of them buy (not lease).
Many of us envision Mitt Romney when we think of getting rich in America - wealthy parents, Harvard degrees, partner in a Boston-based financial business, residences in Wolfeboro, N.H., and La Jolla, Calif. But the more common path is a guy who sold Christmas cards door-to-door and flipped burgers as a kid, received a public school education, and now runs a scrap yard in Missouri.
But here's the kicker.
That millionaire next door now has children who have enjoyed the fruits of his labor. Unlike the parent, this son or daughter isn't as likely to work at McDonald's. Whereas Mom and Dad received a public education, the children are privately educated. They are the ones who get to go to Ivy League schools, and when they graduate, they have little inclination to step into the family business that paved their way. So where do they end up?
According to Stanley, "living in fashionable neighborhoods like Manhattan's East Side, while running nonprofits and all the while being heavily subsidized with heavy outpatient care from their millionaire-next-door-type parents."
The hardest part for millionaires, it seems, is passing on the lessons of financial success.
Contact Michael Smerconish via www.smerconish.com. Read his columns at www.philly.com/smerconish.