Contrary to popular belief, many millionaires do not live in mansions in prestigious neighborhoods.

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The Millionaire Lifestyle

We all imagine millionaires drinking expensive champagne at breakfast, driving expensive cars, shopping at the most prestigious establishments and vacationing in exotic locations.

Researchers have studied the lifestyles of millionaires and come to the conclusion that the majority of them don't live that way at all. Most of the truly wealthy are more substance than flash. That's why they're still millionaires.

Thomas Stanley and William Danko's book "The Millionaire Next Door" revealed that most millionaires really could be the folks next door. They don't have a new car every year or jet around the world. In fact, sometimes they're the least likely person you would suspect.

Stanley and Danko found that millionaires share a few common characteristics:

  • They live below their means. Half of the millionaires interviewed did not live in high-status neighborhoods. Instead, they lived in average neighborhoods in average houses. That's how they were able to save money. The other half that did live in high-status neighborhoods only moved there after they had become wealthy.
  • They lead frugal lifestyles. Most do not buy $5,000 suits, expensive boats or even new cars. You might say they're tightwads. They shop for bargains and always negotiate for a better deal.
  • They're self-employed or own their own businesses. They also love their work -- they connect with their jobs and feel very passionate about them.
  • They plan and study investments. The majority of millionaires invest heavily and spend a large amount of their time studying their investments or seeking advice from financial advisors.
  • They weren't always at the top of their class. Another surprising commonality among the millionaires interviewed was that they didn't all have advanced degrees or graduate at the top of their classes. Some didn't even go to college and a few didn't even finish high school.
  • They're self-made. Finally, the majority of millionaires received no family money and do not plan to give their own children a lot of money. They want their children to succeed the same way they did -- on their own.