Questions - The Millionaire Next Door After reading The Millionaire Next Door, answer the

following twelve (12) questions and compose your Reflective Writing.

1. Explain the following two (2) concepts addressed in The Millionaire Next Door:
 “Big Hat, No Cattle”
This expression goes to show that not everyone plays the role when the have a lot. For

example, the millionaire didn’t exactly wear a big hat but he had a lot of cattle. Real

millionaires don’t always showcase all that they have by buying the most expensive things.
 “Go to Hell Fund”
This fund means that you have more than enough saved up to not work for at least ten years,

or even longer.
2. In the examples of Mr. Richards (PAW) & Mr. Ford (UAW), both men are close in age &

yearly income. Explain why Mr. Richards has nearly five times the net worth of Mr. Ford.

(Be specific).
Mr. Ford spends more of his income than Mr. Richard does and it’s only to live up to his

lifestyle. Mr. Richard concentrates on using his money wisely and saving it instead of

showing it off. On the other hand that is the complete opposite of what Mr. Ford does. He is

more high maintenance and likes to show the world he has money to spend.

3. UAWs live beyond their means. PAWs are builders of wealth. Describe someone you know

who is either a UAW or PAW (or is headed in that direction) & what can be learned from their

example.

My sister and her husband would be considered UAWs and definitely live beyond their means.

They don’t like to buy or shop in cheap places, let alone allow their children to wear used clothes

or hand-me downs. They only get brand names when shopping for food or clothes, and like to

show the world they have nice things. It is amazing to me because they struggle with financial

support due to this type of lifestyle. However, they like to live this way and will work for it if
they have to. I have learned that it may not be the best option and you may not always want to

shop cheap but it is more convenient when you are put into certain situations.

4. Provide short answers to the following three (3) questions:

 “Most people will never become wealthy in one generation if they are married to people who

are ____wasteful__________.”

 Upon giving his wife $8 million of stock, from taking his company public, what did his wife

continue doing?

The wife appreciated it and she was genuine, but then continued to cut out coupons.

 Why would someone who is a millionaire need to budget?

They are living a humble life knowing they have a back-up plan if anything were to ever happen.

As well as securing their present and future.

5. In the example of Theodore “Teddy” J. Friend and his parents, answer the following two (2)

questions:

 The book describes Teddy as being “possessed by possessions.” Explain this comment.

When a person wants to obtain things just to show others by impressing them with it. They try to

make sure others know their success by what they own.

 What was the “small change” Teddy’s parents could have made that would put them in the

millionaire category? (Be specific).

Well, if you think about it we look at small change at the time that could have been a big change

in the long run. In this case it was cigarettes. Teddy’s parents could have saved or put aside that

money they used for buying cigarettes each time, because overall it could have been a big

investment.
6. Mr. Rodney is a high-income/low-net worth corporate manager. Explain why he is described

as having “sold his financial independence.”

He was offered a great matching stock purchase plan by his job, and turned it down. It would

have been a 6 percent of the corporation over time. However, he decided he didn’t have the

money for that benefit right now. He now struggles with what he’s going to do for retirement.

7. If your goal is to become financially independent, what should your plan be? (Be specific).

It should be to start saving right now even if it’s just a small amount. It was last in the long run,

and we will be able to use it for what we want and need. Also, by eliminating the unimportant

wants that we think we need and start saving in that way.

8. Why did Mr. W.W. Allan decline the gift of a Rolls-Royce?

He said it didn’t fit his lifestyle and he wouldn’t want to put that image out there like that. For

example, he likes to fish and wouldn’t show up in a car like that to go fishing. He didn’t need

extra baggage.

9. Regarding Economic Outpatient Care (EOC), answer the following three (3) questions:

 What is the likely financial outcome for Mary & Lamar once her Mother passes away?

They are able to inherit their mother’s money that she had left behind for them.

 The parents of Ms. BPF were determined to give their daughter every advantage. After they

created an “ideal” environment for her, what was the result?

It was a very predictable spoiled lifestyle that was already set out for her. She was more

privileged than most kids her age.
 In the case of Laura (A Woman of Great Courage), explain the primary message derived from

her story?

She grew up in circumstances that she was able to encourage others to have the courage she did!

10. Regarding Affirmative Action, Family Style, answer the following two (2) questions:

 In the example of sisters Ann & Beth, describe the consequences to Beth & her husband from

receiving EOC?

The consequences that they were not responsible enough to take the money that was left behind.

 Explain the concept “weakening the weak.”

You need to be able to take as much as you can when you’re at your lowest, and it tests your

strength more than anything.

11. Explain the root cause for the conflict between Mr. W & the residents of the vacation

condominiums. (HINT: It’s not because of his dog.)

Mr. W and his wife were not considered “beautiful people” by society but the other residents

were. The dog was only an excuse for the people to get them out of the place.

12. Now that you have finished reading The Millionaire Next Door, answer the following three

(3) questions in a minimum of three (3) paragraphs. (12 pts)

 What are the two (2) concepts you found most useful? Explain why.

One concept I found great was that not all millionaires always look like the part of a

stereotyped millionaire that comes to mind. They may be living within their means, by dressing

in clothes they prefer, eating home cooked meals from regular grocery shopping, and having an
average home and car to live by on. It doesn’t always need to be shown when you have money,

because a lot of the time money can change your perception of what lifestyle you live up to.

Another concept I find helpful is UAWs and PAWs due to the background meaning of

both. UAWs live over their means, and PAWs live within it. We know a bunch of people that are

either one, and sometimes we fall in that category too. I find it helpful to know both concepts

because it will help you realize which one you fall in, or want to fall in. It separates us from

knowing what means we really live within. What we need to take out of our lives, and what are

necessary.

Overall, these concepts can always help us overtime. It is a great way to keep ourselves

humble and how to live when we come into having a huge amount of money. Also, the way we

handle money and save it. It’s always a great way to preserve our character when we are living a

certain lifestyle. We sometimes lose sight of that when we do come into a bunch of money.

 Give a specific example of one small change you can make to improve your financial

wellbeing. Reflective Writing Compose 2-3 paragraphs explaining how completing this

assignment helped you achieve at least two (2) of the SLCC Learning Outcomes:

 Learning Outcome #1 (Paragraph #1)

I can start to put away a 5% (more or less) from each paycheck to start saving for the

long run in my future. I need to learn how to save more than I spend to help secure my family’s

future! I have been able to learn about the type of things that could help me save. Also, how

small the amount of sacrifice seems, it will matter when you save it for a better and longer time.

 Learning Outcome #2 (Paragraph #2)
I have also learned that budgeting is a huge part of becoming successful with money. You

don’t have to be the richest person but having a lot of money or small amount if you know how

to budget it, you will be secured. That story was a great way to learn how to budget now if you

want to be safe in the future. I’ve learned so much from just the examples shared, and stories that

built from budgeting.

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