Podcast Episode 03 – “Are You the Next Millionaire Next Door?” with Dr. Sarah Stanley Fallaw
Episode 03 – Did you know that the top five professions for millionaires doesn’t include doctors? Teachers are #3!! Why are teachers better at building wealth than physicians?
In this episode, Dr. Sarah Stanley Fallaw unpacks the research behind the book The Next Millionaire Next Door. We talk about what it takes to be a millionaire in America today. You’ll be amazed to see how simple it is, and you’ll be blown away that more physicians don’t do it.
If you’re less than five years out of training and you listen to this episode, there’s no excuse for you to not retire as a millionaire. None of these strategies are sophisticated. It’s simple, but it’s not easy. It requires discipline, frugality, and making smart choices with our money on a daily basis. But, the reward is tremendous.
So, do you have what it takes to be “the next millionaire next door”? Listen to the episode and find out!
It’s a lot easier to purchase items or consumer goods that denote status than it is to build wealth. It’s a lot harder to build wealth. It takes longer. It’s average, it’s boring, and it’s a lot easier to go buy something.
– Dr. Sarah Stanley Fallaw
Why are teachers more likely than physicians to become millionaires?: click here.
Featured online community: White Coat Travel Tips
This Facebook group is run by physicians who are also travel advisors. In addition to the great community that people offer in terms of sharing vacation photos, fun travel stories, and “hidden secrets” of various destinations, the administrators are often able to pass on free discounts on various vacation packages and travel opportunities. It’s an active and engaging community. Check them out!
Resources
- Free download: “5 Financial Decisions Couples Should Make Together“
- Money Personality Test (free): https://www.datapoints.com/personality
- Additional resources from Dr. Fallaw: www.themillionairenextdoor.com
- Connect with Dr. Fallaw: www.datapoints.com
Free resource: 5 Financial Decisions Couples Should Make Together
Buy the books
Show times
- 0:00 – Introduction to the episode
- 2:31 – Introducing Dr. Sarah Stanley Fallaw
- 2:50 – Goals of The Next Millionaire Next Door.
- 4:30 – Are the concepts in The Next Millionaire Next Door really relevant to physicians?
- 6:11 – The portrait of the average American millionaire.
- 7:20 – Why are we bad at turning income into wealth?
- 8:10 – The distractions of people with high income levels.
- 8:40 – Consumer decisions are influenced by the people around us.
- 10:22 – Wait, building wealth is not about a high income level?
- 11:21 – The illusion of a high income can lead to poor financial planning.
- 12:07 – The upside of being a small business owner instead of an employee.
- 14:31 – The high income trap!
- 14:47 – Building wealth myth: You can’t judge someone’s wealth by what they drive, buy, or wear.
- 17:24 – Financial discipline. Wealth is attracted to people who respect money, and respect for money includes the discipline to manage it effectively.
- 18:34 – Frugality is a required mindset for building wealth!
- 19:50 – The FIRE movement is ahead of the curve on frugality
- 20:17 – Choice of spouse has a huge impact on your ability to amass wealth.
- 21:26 – Who is the Chief Financial Officer of your house?
- 22:44 – The problem of “financial infidelity.”
- 23:39 – Money fights and money problems are a chief cause of marital stress.
- 24:49 – Spouses have to be united on money to be united on anything else in their relationship.
- 25:49 – How do we impart good financial habits to our kids?
- 27:20 – Millionaires report that their parents modeled frugality, and that led them to build wealth.
- 28:26 – Most schools won’t teach investing skills and personal financial management, so it’s up to parents!
- 28:52 – Marketing messages consume our lives and prevent us from building wealth.
- 29:57 – What behaviors or characteristics lead to people being a successful investor?
- 31:19 – “Volatility composure” has a high correlation on investment success.
- 33:09 – Don’t bring emotion into your investment decisions!
- 34:58 – Home ownership directly correlates with building wealth, but watch out for these common mistakes!
- 36:50 – “Social indifference” is required for building wealth. “Keeping up with the Joneses” is harder in the era of social media, but it’s still important.
- 38:55 – We need to strike a balance as we celebrate the happiness of others without internalizing their spending habits as being required for ourselves.
- 39:44 – Entrepreneurs are made, not born. Anyone can be an entrepreneur!
- 41:44 – Student loans put physicians way behind the curve. How you approach your student loans matters!
- 43:23 – Choice of school is important from a long-term financial planning perspective.
- 45:29 – What’s Dr. Fallaw’s last piece of advice for physicians who want to become “the next millionaire next door”?
- 47:33 – Summary of the conversation.
- 48:15 – This week’s free resource is the free guide, “5 financial decisions couples should make together.” Get it here.
- 49:03 – This week’s feature online community is “White Coat Travel Tips.”
Full Disclosure: Some of the links to the resources listed above may be affiliate links, which means that I will receive a small commission if you click through and make a purchase. But it doesn’t cost you anything extra—it’s just a way to show you appreciate what we do here. Thanks for this.
Jason Kaspar
An incredible yet simplistic approach to wealth building exhibited in this podcast. The host and guest are 100% correct. It is almost all behavioral, not some great investment decision. All, including those outside the medical world, should follow these basic principles.
Brent Lacey
I totally agree!