MaryOlsen

FIN1050

QuestionsTheMillionaireNextDoor
AfterreadingTheMillionaireNextDoor,answerthefollowingseven
(7)questionsandcomposeyourReflectiveWriting.Youdonotneedto
usethesameformatasshownbelow(withboxes).Useaformatwhich
worksbestforyou.
1.Explainthefollowingfour(4)conceptsaddressedinTheMillionaire
NextDoor:
BigHat,NoCattle
BigHat,NoCattleisaconceptmeaningthatjustbecausea
businessorsuccessfulpersondoesnotownordressthemselvesinwhat
isseenasatypicalmillionaireorwhoownsthenewestorbiggestand
bestproductstodatedoesnotmeantheyarenotwealthy.Theydonot
havebighats toshowoffrathertheyhavemanycattle orotherwords
financialwealth.

GotoHellFund
GotoHellFundissimplyforthefactthatifneededyouwouldbe
abletofinanciallybeabletosupportyourselfwithouthavingtoworkfor
alongperiodoftime.Thisisbecauseyouhaveenoughwealthand
liquiditytosupportyourself.
PAW
PAWstandsforProdigiousAccumulatorofWealth.Inotherwords
peoplewhoarePAWarepeoplewhoarebuildersofwealth.These

peoplebuildtheirnetworthcomparedtoothersintheirincome/age
category.

UAW
UAWstandsforUnderAccumulatorofWealth.Inotherwords
thesearepeoplewhodonotbuildtheirwealthbutratherspendor
showcasetheirwealth.
2.Provideshortanswerstothefollowingfour(4)questions:
Howiswasteful definedinthebook?
alifestylemarkedbylavishspendingandhyperconsumption

Whatisthecornerstoneofwealthbuilding?
Thecornerstoneofwealthbuildingisbeingfrugal.

Mostpeoplewillneverbecomewealthyinonegenerationiftheyare
marriedtopeoplewhoare_wasteful___________.
Upongivinghiswife$8millionofstock,fromtakinghiscompany
public,whatdidhiswifecontinuedoing?
Shecontinuedcuttingout.25&.50centofffoodcoupons
3.IntheexampleofTheodoreTeddy J.Friendandhisparents,answer
thefollowingtwo(2)questions:
ListtworeasonswhyTeddyisconsideredaUAW.
Heconsidersbeingbetteroff withdisplayinghishighincomewithhighstatusartifacts
Heisanultimateconsumer
Hehasalownetworth

WhatwasthemessageTeddysparentssenthimaboutconsumer
behavior?(Bespecific)
oneearnstospend.Whenyouneedtospendmore,youneedtoearnmore.

Whatwasthesmallchange Teddysparentscouldhavemadethat
wouldputtheminthemillionairecategory?
IfTeddysparentswouldhaveinvestedtheirmoneyinsteadofspending
itonconsumingproductsthatcouldhavebeeninthemillionaire
category.
4

4.IntheexampleofMr.W.W.Allan,answerthefollowingtwo(2)
questions:
HeneverextendedcredittopeoplewhoexhibitedtheBigHat,No
Cattle philosophy.Why?
Hebelievedthatpeoplelikethatwouldneverbeabletorepaytheir
debts.
WhydidhedeclinethegiftofaRollsRoyce?
BecauseMr.Allanbelievesthatproductschangepeople.Ifyouacquireonestatusproductyou
willmostlikelyhavetopurchaseotherstillitchangesyourlifestyle.

5.RegardingEconomicOutpatientCare(EOC),answerthefollowing
four(4)questions:
DefineEconomicOutpatientCare(EOC).
thesubstantialeconomicgiftsandactsofkindness someparentsgivetheiradultchildrenand
grandchildren.

Uponlearninghisparentsweredonatingtheirpropertytothelocal
privatecollege,describeJamessreaction?
Jameswasupsetandfeltthatthisdecisionwasunfairbecausehesawhisparentspropertyaspart
ofhisproperty.

WhywasJamessresponsepredictable?
Becausehewasusedtoreceivingcashgiftsfromhisparentsthat
supportedhislifestylesohisparentsgivingtheirpropertytothecollege
wasathreattohisfutureincome.
AsillustratedintheexampleofHenry&Josh,whatisthefundamental
ruleregardingwealthbuilding?(Bespecific.)
Ifyoulivebelowyourmeansyouwilldevelopmorewealth.Ifyouliveaboutyourincomeor
needsyouwillnotbefinanciallywealthratherjusthavemanyitemsthathavebeenconsumed.

6. RegardingAffirmativeAction,FamilyStyle,answerthefollowing
two(2)questions:
WhyweresistersSarah&Alicesodifferentregardingwealth
accumulation?
Sarahhadtakenituponherselftobeselfsufficientandtakecare
ofherselfnotrelyingonanythinghelpfromanyonefinancially.
Aliceontheotherhadwasthecompleteopposite.Sherelied
heavilyonthefinancialsupportherfarthergavetoherevenafter
hedied.ItissafetosaythatSarahdoesnothavemuchtoworry
aboutfinanciallywhereAlicedidaftertheirfathersdeath.
WhatdidKensfathertellhimoften?

Iamnotimpressedwithwhatpeopleown.ButImimpressed
withwhattheyachieve.Improudtobeaphysician.Alwaysstrive
tobethebestinyourfield Dontchasemoney.Ifyouarethe
bestinyourfield,moneywillfindyou.

7. NowthatyouhavefinishedreadingTheMillionaireNextDoor,
answerthefollowingthree(3)questionsinaminimumofthree(3)
paragraphs.
Howhasyourperceptionofmillionaireschanged? What
arethetwo(2)conceptsyoufoundmostuseful? Howwillyou
applythemintoyourlife?
Ihavealwaysthoughtthatmillionairesaresimplypeople
whohavedevelopedsomesortofproductordevicethatproduced
theirwealth.Thesepeoplewillownthingsmanyotherscannot
affordbecauseofthepriceofthem.AfterreadingthisbookIcan
seethetruedifferenceinwhoreallyisamillionaireandwhomay
beposingasone.Thosethataretruemillionairesarethosethat
havenodebtandlivewithintheirneedsandnotconstantlyfilling
theirwants.
Ifoundtheconceptofonlybuyingwhatyouneedandcan
affordareallyhelpfulconcept.WhilereadingthisbookIcould
relatetosomeofthebadhabitsthatpeopledevelopthatfallunder
theUAWcategory.ThisisnotthelifestyleIamwantingtoliveor
thetypeoflifestyleIwanttoteachtomyfuturechildren.
AnotherconceptthatIfoundextremelyinterestingand
helpfulwasEconomicOutpatientCare(EOC).Ifeellikethisis
somethingthatmostamericansstriveforasparents.Theyare

wantingtoprovidefortheirchildrenandgivethemwhatthey
didnthaveormakesuretheyarenothavingtodealwithanykind
ofhardships.Thismademethinkofwhatmostteachersrefertoas
thehelicopterparents.Theywanttheirkidstobesuccessfuland
geteverythingtheyneedtobesuccessfulbutattheendoftheday
theyarereallyhurtingthemmorethentheyarehelping.Ihave
alwayswantedtobeabletoprovidefinancialsupporttomy
childrenwhenitcomestotheirweddingsandcollegefunds.I
alwayswantedtojustputmoneyasideforthemwhentheyreach
thatpoint.ThisisstillsomethingIamwantingtodobutIthink
thatIamneedingtofindaproductivewayformykidstoearnthis
money.Iwantthemtounderstandthatthismoneywillbetohelp
themgetstartedandthatIcannotprovidefromthemtobe
successful.Itissimplygivingthemanopportunitytostartoutwith
alittleextrahelp.
ReflectiveWriting
Compose23paragraphsexplaininghowcompletingthisassignment
helpedyouachieveatleasttwo(2)oftheSLCCLearningOutcomes.
AfterreadingTheMillionaireNextDoor:Surprisingsecretsof
AmericasWealthybyStanley&DankoIfeelthatIhavedeveloped
knowledgethatwillhelpmebecomesuccessfulinmylife.Ihadnot
realizedtheaffectsthatbeingfrugalcouldhaveonaperson.Ihadan
ideaofhowithelpedpeoplestayoutofdebtbutIdidnotrealizethatif
youputinthehardworkandarefrugaltothepointofonlywantingto
purchasewhatyouneedyoucanliveahappylifefullofwealth.
Thisassignmenthelpedmetothinkcriticallyaboutmyfinancial
choicesandwhatkindofpersonIwanttobe.DoIwanttobewealthy
withitemsorwealthywithmytimesandmoneytobeabletolive
comfortablewithoutthestressofneedingtoconstantlyearnmoremoney
tomeetendsmeat.Overallthisbookwasmoreinterestingandbeneficial

toreadthenIhadoriginallythought.IamhappyIwasabletolearnand
questionhowIamdoingthingstomakemyselfabetterperson.