The Automatic Millionaire: A Powerful One-Step Plan to Live and Finish Rich

ISBN: 0767923820
ISBN 13: 9780767923828
By: David Bach

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Business Currently Reading Finance Financial Money Non Fiction Nonfiction Personal Finance Self Help To Read

About this book

What's the secret to becoming a millionaire? For years people have asked David Bach, the national bestselling author of "Smart Women Finish Rich," "Smart Couples Finish Rich, " and "The Finish Rich Workbook," what's the real secret to getting rich? What's the one thing I need to do? Now, in "The Automatic Millionaire," David Bach is sharing that secret. "The Automatic Millionaire" starts with the powerful story of an average American couple--he's a low-level manager, she's a beautician--whose joint income never exceeds $55,000 a year, yet who somehow manage to own two homes debt-free, put two kids through college, and retire at 55 with more than $1 million in savings. Through their story you'll learn the surprising fact that you cannot get rich with a budget! You have to have a plan to pay yourself first that is totally automatic, a plan that will automatically secure your future and pay for your present. What makes "The Automatic Millionaire" unique: You don't need a budgetYou don't need willpowerYou don't need to make a lot of money You don't need to be that interested in moneyYou can set up the plan in an hour David Bach gives you a totally realistic system, based on timeless principles, with everything you need to know, including phone numbers and websites, so you can put the secret to becoming an Automatic Millionaire in place from the comfort of your own home. This one little book has the power to secure your financial future. Do it once--the rest is automatic!

Reader's Thoughts

Doug

I have read this book several times since it was published. I like its simplicity. It is 200 pages, but I took notes on the important principles and I was able to boil everything down onto one page. None of the ideas or concepts are new, but this book does give readers some insights into how one might go about putting these principles into action. This book and Dave Ramsey's Total Money Makeover are probably the best two resources in terms of 1) learning about personal finance and 2) putting a plan in place to address most folks money problems.

Molly Murphy

Put financial savings as a priority. This book was a great motivator and teaches you strategies to find money to save and how to put it on autopilot.

Diana

David Bach's titles were recommended by our financial planner, so I read this one first. A good, quick read with one basic premise: pay yourself first. This means if we're going to up our savings, it's best if it comes out of our paycheck automatically and if it goes straight into a pre-tax retirement account, like an IRA.His plan isn't just for retirement accounts. The idea is that any sort of savings needs to be set up on an automatic plan if it's going to happen. From reading this, I know we have two points of action: we need to up the amount going into the retirement account as it's not nearly enough and we need to start an auto-transfer from our checking to our savings account after every payday. Then I'll have to re-read to decide on our next step.

Troy

Great book. Everything he talks about is really common sense. If you just invest 15% (give or take), you'll be well off in your retirement. The key is to automate it, so you don't 'see' how much you're 'losing'. It's very informative too, he gives you actual details on how to do what and where to go for it. I highly recommend this to people of all ages, but especially people in their 20's and 30's.

Mike

Basic information about money presented through some of the most contrived stories I've ever heard. I won't say that the information is wrong, but it isn't really groundbreaking either. The book might be aimed more at people who really are clueless about finances, because most of this is already in practice for me. Maybe I'm just ahead of the curve.

Dora McFadden

This was a good book but honestly its a lot of common sense. The reality to being a good saver is to use good judgement. But the author does make some good points about how in the long run when you buy your daily cup of coffee from any place $2 a day over decades adds up fast and you could have saved yourself a couple hundred grand. When you think of the little things at that perspective you think twice about "the latte factor". He has good points on investing in your 401K and IRAs. Plus the concept of paying yourself first. Its something that after the first read I think you can skim over every three to five years to "refresh" your goals and get yourself back on tract.

Sasha

This is a difficult book to rate. Informationally, it should get a 5. For ease of understanding, it should get a 5. But as a "good read," well, much of the first half read like an annoying infomercial and that really bugged. I also don't like phrases like "get rich."So, it's weird that I read this book. I did so at the suggestion of a friend, otherwise I never would have given it a thought. (Thank you, Katrina!) I began skeptically, but this ended up being the very book I needed to read, for me and for my marriage. Dear Phil has been patiently waiting 15-1/2 years for me to have any inkling about finances and planning. Nothing in this book was new to him, but it was a complete revelation to me. Knowing what I now know, I am amazed that Phil has stayed married to me this long!!!!! What a real man.This is going to be required high school reading for graduation from our homeschool. I truly wish I had understood all of this as a college student. Thankfully, Phil DID understand it as a college student and he's quietly tried to do what he could without me being "on board." Now life should get better for him.

Shan

The Automatic Millionaire is a popular personal finance guide geared toward beginners that, despite having some good advice, fails to be a solid finance book due to two major issues.First, the first impression one gets is that this book reads like a late night infomercial. Had I picked this book up at a bookstore I would've put it down after reading the first few pages. I was able to make it through the book by ignoring the snazzy marketing-speak; and that's no small feat. I felt like the whole time I was being sold some sort of Ronco product, and that made me feel dirty and dishonest on Bach's behalf. That style of writing only succeeds in turning off your readers.Second, Bach misleads his readers by suggesting they forgo a planed budget. His point is that if you do a written budget you'll fail to pay yourself first. For beginning personal financiers, that is a risk of budgeting your paycheck, but there is a way around it . Bach should suggest people pay themselves first, then budget with what's left. This approach is not only more holistic, but it also teaches first-timers the importance of actually knowing where money is coming from and where it ends up.

Deena

This book made me rethink all my views on money. It was also the impetus to get me focused financially.

Tiffany

Fast read on finances, but really the same message drilled in over and over: automate your finances. Automate your retirement, automate your credit card payments, automate your tithing (I have to admit I didn't finish the last chapter). It's a no-brainer book nowadays. Who doesn't automate these? Really helpful chart though that I did print out on how starting saving earlier can not only make you more via compound interest, but it involves less principle paid in. This information doesn't help me now, but it's good for me to show visuals to my kids. I'd love to start them off on the right financial footing, and it seems investing their teenaged-year-jobs wages is one of the most prominent methods to secure this.

Anthony Deluca

The Automatic MillionaireBy: David BachCopyright 2003Reviewed May 2008Listened to Unabridged AudiobookThe automatic millionaire is an excellent, practical book that will indeed instruct anyone how they can become a millionaire. In my subjective opinion, however, the younger one is, the easier it will be to make this work well. Also, some minimal level of income will help too. BUT, I recommend this book to EVERYONE who is not already independently wealthy.The book basically illustrates how one can mass a ton of savings in their lifetime and retire with plenty of money in the bank. This revolves around saving at least ten percent of your income… and not just manually putting it away each month, but automating the process of filling this repository of savings. A typical hard-working American couple in their early fifties is used as the example throughout this book.Techniques mentioned in the book include: The Latte Factor: Instead of spending just a few dollars each day on frivolous items, such as a $3.50 Latte, save that money. charts are given to show the mass amount of investment savings to which this can lead.; Pay yourself first: In other words make the redirection of money into your saving happen before any other redirection of funds, even taxes, occurs to your paycheck.; Make paying your self automatic: Don’t count on yourself to manually make a transfer, instead having this money redirection be automatic so you never have to think about it.; Don’t buy anything with credit other than a house: You cannot invest and save well if you are paying interest charges on non-investment items.The only thing I did not like about this book was the drawn out introduction where Bach kept saying over and over again how his plan is practical and works, but without starting to explain his plan. In conclusion, however, even with the few negatives I mentioned this is an excellent, insightful, inspiring publication that would be useful to all.

Sarah Tiambeng

This book was absolutely terrible. It provided some good insight on money management however I could not get passed how sales-oriented this book was. I couldn't get through one chapter without him trying to sale me some additional project he has or lead me to his website. I found this distracting and it felt like he was trying to take advantage of readers by weaving this information throughout the book. Also, the information generally caters to people with steady jobs and does not account for people who make lower wages. I imagine that anyone earning minimum wage would find the guidelines of this book extremely hard to follow.

Tim

A very simple and short read, with one basic premise: start saving money, today, by setting up an automatic 401(k) (or similar) pre-tax contribution. There's a bit more information in there about what to do if you have personal debt, how to invest in your own home, etc., but it's basically about ending up with a bunch of money by simply contributing to your 401(k).I already do contribute to my 401(k) at work, but reading this was a good reminder of why I should continue to do so, and how much to contribute. I also learned a bit about the best ways to pay down a mortgage (the twice-a-month payment plan is interesting).

Josie

This is one of the best personal finance books I've ever read. It is simple and straightforward. Even though I'd heard much of this advice before, the simplicity of this book has inspired me in ways I haven't been before. Is it brilliantly written? no. But I found it ridiculously useful.

Peter

I would recommend this book to the complete novice, if you want to learn some very simple things that you can do to help you secure your retirement then read this book. If however, you want to really understanding investing, and finance this probably isn't the best book.The book has a few good tips that work for everyone:1: Pay yourself first (A common recommendation)2: Pay your mortgage bi-weekly (could reduce it by 5-10 years)3: Put away 10% of your money4: Tithe5: Always save some, even if you have debt, while debt reduction should be a priority, having a little cash will help to avoid future debt.The book also some tips that I don't agree with:1: Buy a home (This book was pre-bust) not all people benefit from home ownership and it's not something to be undertaken lightly. While there are *many* benefits, sometimes renting works for certain types of people and areas.2: Pay your credit cards with the lowest amount left first... While this is great psychologically, I would argue that you should probably pay the one's with the largest interest rate first. What if your lowest card has a 0% rate and the one with the highest balance has a 20% rate? You'd be much better off chipping away at that 20% card :)3: His assessments on when you will be a millionaire on $5 a day is based on 10% annual return, which by the way is better than the stock market (based on the S&p 500 avg for 50 years) long term average which happens to be arguably the best long term investment in terms of returns. How does he suggest you do this? Mutual funds... small problem being that somewhere in the 85%+ range of mutual funds _fail_ to even meet, much less beat the market. Even the ones that do often charge an annual fee as well as front/rear loads that can chip away at that rate. More importantly, just because the fund earns 10%, doesn't mean you will :) That's the money the fund earns *before* all of the costs. According to Warren Buffet, and Charlie Munger, and John Bogle (He's biased as he did create it...) the best investment for someone who doesn't want to learn, would be an S&p 500 index fund that simply tracks the market. These tend to have the lowest fees possible and essentially guarantee roughly the same rate of return that the overall market returns.In summary, this is a good book for someone who wants an easy way to guarantee some retirement and move in a more fiscally responsible direction. This is not, however, in my opinion the bible on this subject, nor is it the final word. While I do like his automatic payments structure, and do agree with that logic, I think the investment strategies need a little more depth and experience.

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