The book The Millionaire Next Door came out in 1996. I resisted reading it for a long time because I figured it would be full of self-affirmational claptrap, and there is some of that, but it’s mainly about a simple financial truism: no matter how much money you make, the only way to get rich is to spend much less than you earn. The millionaires in the book drive cheap, old cars, drink Bud rather than champagne, and pay off their mortgages early. They have huge overhangs.

Honestly, they also seem frustratingly immune to status anxiety. If everyone in your social group lives in a big house and drives a Range Rover, and you live in a two-bedroom and drive a ’97 Camry, I imagine you get a lot of strange looks and miss out on invites to champagne-soaked bacchanals. Sure, you can be smug about the fact that you’re saving money and your friends aren’t, but people who proclaim loudly that they never try to keep up with the Joneses sound a lot like a politician loudly denying that he posted that picture on Twitter.

And I’m really talking about houses and cars here, not your drink of choice. When I get an email from a friend of a friend saying, “I have a financial problem,” it’s almost always because they’re spending too much on housing, cars, or medical bills — the necessities All Your Worth warns us not to let get out of hand.

I do know is that it is possible, above a certain income level, to maintain a sizable overhang and live well below your means, because I know a lot of people who do it. It would be absurd to generalize about how happy these people are compared to their indebted peers, but I can tell you that accumulating a sizable nest egg through living small doesn’t seem to be making them obviously miserable.

Matthew Amster-Burton

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