Jamie Lancaster
Professor Alena Johnson
FCHD 3350 – LO1
4 September 2016
The Automatic Millionaire
1. Meeting the Automatic Millionaire David Bach begins by telling the reader about his first experience meeting an automatic millionaire. He delves into his story about Jim and Sue McIntyre, a middle aged couple. Curiously, they act more like a newlywed couple and they joyously announce their up and coming retirement. Now Jim is in his fifties, and most people his age do not have enough money to retire so early. Bach asks, “How did you do it?” The McIntyre’s explain that by paying themselves first. They have no debt, and have their mortgages (yes multiple) paid off. The McIntyre’s are smart spenders, they don’t buy things they don’t need. Both Jim and Sue smoked and spent countless dollars on cigarettes per day. This is similar to the Latte Factor. This is described as “wasting money on expensive coffee each morning…” (pg. 21) The most important principle the McIntyre’s share is the automatic payments. This principle requires no will power or discipline. By making payments automatic, a portion of each paycheck goes directly into a savings account. Letting money grow in their accounts allowed the McIntyre’s to …show more content…
The McIntyre’s don’t sit down and write out a check every couple of weeks and deposit it into a savings account. They set up an automatic system to pull a certain percentage of their income directly into their retirement account. They took advantage of the 401 (k) offered by their employer, decided how much to contribute, and automatically transferred money from their income. By automatically contributing to, and maxing out your retirement account, you utilize the fastest way to become rich. It is also wise to diversify your portfolio. This means you need to invest wisely and spread your money across several different assets. The right mix of stocks and bonds will generate income over
Professor Alena Johnson
FCHD 3350 – LO1
4 September 2016
The Automatic Millionaire
1. Meeting the Automatic Millionaire David Bach begins by telling the reader about his first experience meeting an automatic millionaire. He delves into his story about Jim and Sue McIntyre, a middle aged couple. Curiously, they act more like a newlywed couple and they joyously announce their up and coming retirement. Now Jim is in his fifties, and most people his age do not have enough money to retire so early. Bach asks, “How did you do it?” The McIntyre’s explain that by paying themselves first. They have no debt, and have their mortgages (yes multiple) paid off. The McIntyre’s are smart spenders, they don’t buy things they don’t need. Both Jim and Sue smoked and spent countless dollars on cigarettes per day. This is similar to the Latte Factor. This is described as “wasting money on expensive coffee each morning…” (pg. 21) The most important principle the McIntyre’s share is the automatic payments. This principle requires no will power or discipline. By making payments automatic, a portion of each paycheck goes directly into a savings account. Letting money grow in their accounts allowed the McIntyre’s to …show more content…
The McIntyre’s don’t sit down and write out a check every couple of weeks and deposit it into a savings account. They set up an automatic system to pull a certain percentage of their income directly into their retirement account. They took advantage of the 401 (k) offered by their employer, decided how much to contribute, and automatically transferred money from their income. By automatically contributing to, and maxing out your retirement account, you utilize the fastest way to become rich. It is also wise to diversify your portfolio. This means you need to invest wisely and spread your money across several different assets. The right mix of stocks and bonds will generate income over