BLOG

Millionaire Housewives?

By Thomas J. Stanley on Jun 15th, 2010 in Current Events

In Stop Acting Rich, I point out that only about 27% of those who live in million dollar homes have a million dollars in investable assets.   I believe the greatest detriment to building wealth is our home/neighborhood environment.  If you live in a pricey home and neighborhood you will act and buy like your neighbors. In other words, human beings have an innate tendency to act and be like those around them — to fit in — and even to compete (in a neighborly way, of course). The type of home we live in and where we chose to live often takes the greatest toll on our financial wealth and from it all other perils flow.  The higher the market value of a home the less productive the “owner” is in transforming his income into wealth.


The more expensive homes, the more affluent neighborhoods are a vortex of sociological forces. The more affluent the neighborhood, the more its residents spend on almost every conceivable product and service. From cars to haircuts, and from wine to watches, those living in “prestige estates” spend more.  How do millionaires who live in homes valued at $300,000 to under $400,000 differ from people (millionaires and non millionaires) whose homes are in the $2 million to under $4 million category?  Here are just a few examples from Stop Acting Rich (Table 2.3).  Those who live in expensive homes are 7 times more likely to drive a Mercedes-Benz; 13 times more likely, a Porsche; shop at Neiman Marcus, 12 times, Sax Fifth Avenue, 9 times; and have paid over $1,000 for a suit, 44 times more likely!  We take consumption cues from our neighbors. If many of our neighbors have a much higher level of income and wealth than we do, we will have set ourselves up to lose the war before we have even begun to battle. 


Last week, Zac Bissonnette wrote an enlightening and entertaining article in dailyfinance.com about one of the “Real Housewives of New Jersey” and her current economic situation.  According to his article, she and her husband have an $11M debt!  However, if you have ever watched the program, the couple lives in what appears to be a multi-million dollar home in an exclusive New Jersey neighborhood which is within the metropolitan area of New York.  Could this be just another case of “big hat, big home, no cattle (wealth)” of any kind?


Most of the self made millionaires I have studied have one thing in common: they were able to build wealth precisely because they never lived in a home or neighborhood environment where their domestic overhead made it difficult for them to build wealth. In essence, they ran their households like a productive business. It is not only about how much you make (or generate in sales). More importantly, it is how much you keep. And the “keep” component begins and ends at your home address.

7 responses to “Millionaire Housewives?”

  1. Kristia says:

    I am ashamed to admit, but I watch the housewives series on bravo. It is my guilty pleasure as I find some of these ladies very entertaining to watch. They think so many of us are jealous of them, but I’ll take my 1800 sq foot house and my 6 figure and growing net worth any day. And I will continue to shake my head every time I see them buy their way to bankruptcy court.

  2. AK says:

    Interesting. I’d be interested in hearing more about actual housewives (and house husbands). What are *their* lifestyle choices (do they also get $20 haircuts, etc.)? Much is made in your books of the financial stability provided by a stable marriage with an at-home spouse, but few details are given about the choices those spouses make. While not primary earners, they are often primary spenders (or on the front lines of deciding whether to spend). I’d love to hear more.

  3. Nathania Johnson says:

    Because of your book Millionaire Women Next Door, I’m trying to become more like the women in that book, despite being a stay-at-home, homeschooling mom.

    I’m learning about investing. We’re working on paying down our debt now, but when it’s time to invest, I want to be savvy 🙂 That’s something I learned from your book.

    But this is another good tip. Because lately I’ve been dreaming of having a bigger house someday, and maybe it’s better to learn contentment and wealth-building.

  4. Kekoa says:

    Your reminder could not have come at a better time. We are looking to buy a home in the near future and in conjunction with your findings and Dave Ramsey’s teachings we will be buying a home that will be blessing and not a curse. Family and friends say we deserve something larger and better, (never EVER mentioning the larger payments) but they haven’t read your books so what do they know!

    -Thankful for your blog

  5. seks says:

    This is a really good read for me, Must admit that you are one of the best bloggers I ever saw.Thanks for posting this informative article.

  6. Walter says:

    My wife and I choose to rent a nice apt on a lake. This enables us to save and invest a large portion of our income as the difference in buying/renting in Tampa Bay is $820 vs $1800+ including repairs, maitence, lawn service and additional utilities/furnishings for a home its “true” cost would be about $2300..so insted we invest $1000 a month, put money into our emergency and savings accounts,are DEBT FREE!! and will be able to buy future cars with cash and are well on track to be millionaires. its so strange but all the homeOWERS here are like zombies telling us to join their cult in homwOWERship..normal is broke, we are weird and love it

  7. Peter says:

    I enjoyed your books and Dave Ramsey’s, but we are a little different in terms of house.

    We live in a million dollar house on the lake, but just paid off the mortgage which took us almost 5 years. We are now completely debt free. We always pay off credit card or any other bills every month, shops at Goodwill, dollar stores, Big Lots and WalMart. We look for sales and clearances all the time. Our two cars are 7 and 17 years old now which we paid cash when new. I do all car maintanence myself. We also do all of our own yard works which is rare in our subdivision. We have sizable retirement accounts already, and will able to save about 50% of our income with the house now paid off.

    We both work from home so do need space in our house, but we always prefer better houses and are willing to pay for it. Other than house, we are very frugal. We took only a one week vacation during last 5 years. When we do stay in a hotel, we usualy eat breakfast and sometimes even dinner in our room to save food cost.

    Interestingly, we are both engineers which tends to accumulate more wealth as your study indicate. So we do match your profile of balance sheet affluent mostly. Thank you for your work which shall help a lot of people.

Leave a Reply

Your email address will not be published. Required fields are marked *