From the Publisher
“The Automatic Millionaire is an automatic winner. David Bach really cares about you: on every page you can hear him cheering you on to financial fitness. No matter who you are or what your income is, you can benefit from this easy-to-apply program. Do it now. You and your loved ones deserve big bucks!”
-Ken Blanchard, co-author of The One Minute Manager
“The Automatic Millionaire gives you, step by step, everything you need to secure your financial future. When you do it David Bach’s way, failure is not an option.”
-Jean Chatzky, Financial Editor, NBC’s Today
“David Bach's no spin financial advice is beautiful because it's so simple. If becoming self-sufficient is important to you then this book is a must.”
-Bill O'Reilly, anchor, Fox News, and author of The O’Reilly Factor and The No Spin Zone
“Finally, a book that helps you stop sweating it when it comes to your money! The Automatic Millionaire is a fast, easy read that gets you to take action. David Bach is the money coach to trust year in and year out to motivate you financially.”
-Richard Carlson, author of Don't Sweat the Small Stuff and Don’t Sweat the Small Stuff About Money
“David Bach’s The Automatic Millionaire proves that you don’t have to make a lot of money or have a complicated financial plan to get started — you can literally start towards your financial dreams today, in a matter of hours, with just one life changing secret: Pay yourself first and make it automatic! Equally important, this book shows you how to simplify and automate your entire financial life.”
- Harry S. Dent, Jr., investment strategist and author of The Roaring 2000s
“The Automatic Millionaire is, simply put…a great little book! You can read it in a matter of hours and take action immediately on a powerful, simple, totally AUTOMATIC plan to become a millionaire.”
- Robert G. Allen, coauthor of The One Minute Millionaire
“The Automatic Millionaire is brilliant in its simplicity and thoroughly enjoyable to read. If you want to create financial security and still sleep at night, you've just got to get this book! Thank you, David...your advice will change people's lives.”
- Barbara Stanny, author of Secrets of Six-Figure Women and Prince Charming Isn't Coming
“I once heard that to make something powerful, you need to make it practical. The Automatic Millionaire is a book that is 100% practical and powerful. David Bach is one of the few individuals in the world of finances who truly wants to make a huge impact in other people's financial lives. This is one of those rare books that can really change your life!”
- Louis Barajas, Author of The Latino Journey to Financial Greatness
“David Bach lets you in on the secret to finishing rich, and it’s so simple anyone can do it. Read this book, follow his advice, and it will change your life.”
- Candace Bahr and Ginita Wall, co-founders of the Women’s Institute for Financial Education (WIFE.org)
“Pay yourself first. It’s simple ideas like this that can make all the difference in your financial future. Ignore David Bach's new book at your own peril.”
- Al Ries, author of Focus, The Future of Your Company Depends on It
“David Bach makes understanding your finances easy, fun and exciting. The Automatic Millionaire is a practical and smart guide to mastering your relationship with money.”
- Barbara De Angelis, Ph.D. author of What Women Want Men to Know
“More people will become millionaires in the years ahead than in all the previous years of human history. It has never been more possible for you to get out of debt, achieve financial independence and build a financial fortress around yourself than it is today. This fast-moving book by David Bach gives you the practical strategies and techniques you need to take complete control of your financial life and become the millionaire you want to be.”
- Brian Tracy, author of Goals!
Bach, author of several bestsellers including Smart Women Finish Rich and Smart Couples Finish Rich, offers a simple prescriptive plan for financial security. The secret: the astonishingly vanilla "Pay Yourself First," which, in Bach's words, is "the one proven, easy way to get rich." Instead of worrying about taxes, budgeting or investing, the key, according to Bach, is to set aside between 10% and 15% of gross income for savings the equivalent of one hour's worth of income every day. While this strategy may seem obvious, many people don't take this basic step. That's why Bach says everyone should write down their "Automatic Millionaire Promise," which spells out what percentage of their income they will start saving by a certain date. To insure that people carry through on their efforts, Bach says they should have deposits automatically made to a retirement account. Then, the next step is to capitalize on the power of compounding by contributing the maximum amount to, say, an employer's 401(k) account. To help readers navigate the maze of investment choices, Bach includes contact information for a number of mutual funds and Web sites offering authoritative financial information. Bach's key principle, along with such advice as buying real estate, paying down debt and making charitable deductions, is not groundbreaking; and regrettably, it may be unrealistic for many: tens of millions of Americans are in serious credit card debt because they can't make ends meet on their salaries; how, then, are they to save so much of their gross income? However, his easygoing approach, complete with real-life examples and clever phrases such as "Latte Factor," will appeal to the many money-challenged consumers who have made a New Year's resolution to get their finances on a firmer footing. (Dec.) Forecast: With a confirmed appearance on Oprah along with a television and radio satellite tour, and some 700,000 of Bach's other books in print, this one should hit some bestseller lists. Copyright 2003 Reed Business Information.
Bach (Smart Couples Finish Rich) takes a unique approach to the financial wealth-building genre by shaping his many tips and techniques around an average American couple with a joint annual income of under $55,000 who manage to own two homes debt-free, put two kids through college, and retire at 55 with more than $1 million in savings. The sound advice covers well-known principles of eschewing credit cards and the importance of establishing and keeping to a plan to pay yourself first that is totally automatic, a plan that will secure your future and pay for your present. The author's lively narration keeps the listener's interest in these facts about how money works and how not to spend every dollar you earn. Highly recommended for all public libraries.-Dale Farris, Groves, TX Copyright 2004 Reed Business Information.
Read an Excerpt
MEETING THE AUTOMATIC MILLIONAIRE
I'll never forget when I met my first Automatic Millionaire. I was in my
mid-twenties and was teaching an investment class at a local adult-education
program. Jim McIntyre, a middle-aged middle manager for a local utility
company, was one of my students. He and I hadn't spoken much until one day when
he came up after class to ask if he could make an appointment with me to review
his and his wife's financial situation.
The request surprised me. Though I felt strongly (and still do) that just about
everyone can benefit from the advice of a qualified financial planner, Jim
didn't strike me as the type who would seek it out.
I told him I'd be happy to set up a meeting, but if he wanted my help, his wife
would have to come too, as my group managed money only for couples who worked
on their finances together.
Jim smiled. "No problem," he said. "Sue's the reason I'm here.
She took your Smart Women Finish Rich seminar and told me I should sign
up for your course. I've liked what you've had to say, and we both figure it's
time to do some financial planning. You see, I'm planning to retire next
Now I was really surprised. I didn't say anything, but as I looked Jim up and
down, I doubted he could be in a position to retire. From the few comments he
had made in class, I knew he was in his early fifties and had worked for the
same company for thirty years, never earning much more than $40,000 a year, and
didn't believe in budgets. I also knew that he considered himself to be
"ultraconservative," so I figured he couldn't have made a fortune in
the stock market.
My Grandma Rose Bach had taught me never to judge a book by its cover. But
something didn't add up. Maybe Jim had just inherited a lot of money. For his
sake, I hoped so.
"WHAT AM I MISSING HERE?"
When the McIntyres came into my office a few days later, they looked exactly
like what they were: hardworking, "average Joe" Americans. What has
stuck in my mind about Jim is that he was wearing a short-sleeved dress shirt
with a plastic pocket protector in his breast pocket. His wife, Sue, had a
little more flair, with some seriously blond highlights. She was a beautician,
a couple of years younger than Jim.
The thing was, they didn't act like middle-aged people. They were holding hands
like two high school kids on a first date, bubbling with excitement. Before I
could ask how I could help them, Jim started talking about his plans and what
he would do with his free time. As he did, Sue kept exclaiming, "Isn't it
great he can retire so young! Most people can't retire until they reach
sixty-five if then, and here's Jim able to do it at fifty-two!"
"LET'S NOT GET AHEAD OF OURSELVES."
After ten minutes of this, I had to interrupt. "Guys, your enthusiasm is
contagious, but let's not get ahead of ourselves here. I've met with literally
hundreds of potential retirees over the last few years, and I have to tell
you--hardly any of them have been able to retire in their early fifties."
I looked Jim in the eye. "Usually people come to my office to find out if
they can retire," I said. "You already seem to be sure you can. What
makes you so certain you can afford to?"
Jim and Sue exchanged a look. Then Jim turned back to me. "You don't think
we're rich enough," he said, "do you?" The way Jim put it, it
wasn't exactly a question.
"Well, that's not the way I would have phrased it," I replied,
"but yes, it takes a fair amount of money to fund an early retirement, and
most people your age aren't even close to having saved enough. Knowing what I
do about your background, I'm truthfully curious about how you could possibly
have enough money." I looked him in the eye. He gazed back at me serenely.
"Jim, you're only fifty-two." I said. "Considering that only
about one in ten people can barely afford to retire at age sixty-five with a
lifestyle equal to what they had when they worked, you have to admit that
retiring at your age with your income would be a pretty big feat."
Jim nodded. "Fair enough," he said and handed me a sheaf of
documents. They included his and Sue's tax returns as well as financial
statements that listed exactly what they owned and owed.
I looked first at their tax returns. The previous year, Jim and Sue had earned
a total of $53,946. Not bad. Not rich, to be sure, but a decent income.
Okay, next. How much did they owe?
I scanned their financial statements. I couldn't find any outstanding debts
listed. "Hmm," I said, raising an eyebrow. "You have no
"THE MCINTYRES DON'T DO DEBT."
They exchanged another smile, and Sue squeezed Jim's hand. "The McIntyres
don't do debt," she said with a chuckle.
"What about your kids?" I asked.
"What about them?" Jim answered. "They're both out of college,
on their own, and God bless 'em."
"Well, all right then," I said, "let's see what you own." I
turned back to the financial statement. There were two homes listed: the house
where they lived (valued at $450,000) and a rental property (a second house
valued at $325,000).
"Wow," I said. "Two houses and no mortgage on either?"
"Nope," Jim replied. "No mortgage."
Next came the retirement accounts. Jim's 401(k) balance currently amounted to
$610,000. And there was more. Sue had two retirement accounts of her own that
totaled $72,000. In addition, they owned $160,000 in municipal bonds and had
$62,500 in cash in a bank savings account.
Talk about a substantial asset base. Add in some personal property (including a
boat and three cars--all fully paid for) and they had a net worth approaching
By any standard, the McIntyres were rich. It wasn't simply that they owned a
lot of assets free and clear (though that in itself was pretty impressive);
they also had a continuing stream of income in the form of interest and
dividends from their investments and $26,000 a year in rent generated by their
second house. On top of that, Jim had qualified for a small pension, and Sue
liked being a beautician so much that she planned to keep working until she was
sixty (even though she didn't need to). Suddenly, Jim's plan to retire at
fifty-two didn't seem so crazy. In fact, it was completely realistic. More than
realistic--it was exciting!
"WE INHERITED KNOWLEDGE."
Normally, I don't get wide-eyed about people's wealth. But there was something
about the McIntyres that impressed me. They didn't look rich. And they didn't
seem terribly special. To the contrary, they seemed perfectly ordinary--your
average, nice, hardworking couple. How could they have possibly amassed such
wealth at such a relatively young age?
To put it mildly, I was confused. But I was also hooked. I was in my
mid-twenties at the time, and even though I was making good money, I was still
basically living paycheck to paycheck. Some months I did manage to save a
little, but more often than not I'd get busy or spend too much the next month
and not save a dime. Many months it seemed that instead of getting ahead, I was
falling behind, working harder and harder to make ends meet.
It was embarrassing, really, and frustrating. Here I was, a financial advisor
teaching others how to invest, and I was often struggling myself. Even worse,
here were the McIntyres, who probably in their best year barely made half of
what I was making, and yet they were millionaires, while I was falling further
and further into debt.
Clearly, they knew something about taking action with their money that I needed
to learn. And I was determined to find out what it was. How could such regular
people have amassed such wealth? Eager to know their secret but not knowing
where to begin, I finally asked them, "Did you inherit any of this?"
Jim broke out in a deep belly laugh. "Inherit?" he repeated, shaking
his head. "The only thing we inherited was knowledge. Our parents taught
us a few commonsense rules about handling money. We just did what they said,
and sure enough it worked. The same is true for a lot of people we know. In
fact, in our neighborhood, about half our friends are going to retire this
year, and many of them are even better off then we are."
At this point, I was hooked. The McIntyres had come to interview me about how I
could help them, but now I wanted to interview them.
LOOKING RICH VS. BEING RICH
"You know," I said, "every week I meet people who take my
classes like you did but who are exactly the opposite of you. I mean, they look
rich, but when you get into the details of what they really have, it often
turns out that they are not only not rich but broke. Just this morning,
I met with a man who drove up in a brand-new Porsche, wearing a gold Rolex
watch. He looked loaded, but when I went through his statements I found he was
actually leveraged to the hilt. A guy in his mid-fifties, living in a
million-dollar home with an $800,000 mortgage. Less than $100,000 in savings,
more than $75,000 in credit card debt, and he was leasing the Porsche! Plus he
was paying alimony to two ex-wives."
At this point, the three of us couldn't help ourselves. We all began to laugh.
"I know it's not funny," I said, "but here was this guy, looking
rich and successful, and actually he's a financial and emotional wreck. He
handled his finances just like he drove his Porsche: redlining all the way.
Then you guys come in. You drive up in a Ford Taurus. Jim here is wearing a
"Nope," Jim interrupted with a smile. "It's an eighteen-year-old
"Exactly!" I said. "An eighteen-year-old Timex. And you're rich.
You guys are happy as clams, still married, two great kids you put through
college, and you're retiring in your mid-fifties. So please tell me--what was
your secret? You must have one, right?"
Sue looked me straight in the eye. "You really want to know?" she
I nodded wordlessly. Sue looked at Jim. "You think we can spare an extra
fifteen minutes to explain it to him?"
"Sure," Jim said. "What's fifteen minutes?" He turned to
me. "You know, David, you already know this stuff. You teach it every day.
We just lived it."
Excerpted from The Automatic
Millionaire by David Bach Copyright© 2003 by David Bach. Excerpted by
permission of Broadway, a division of Random House, Inc. All rights reserved.
No part of this excerpt may be reproduced or reprinted without permission in
writing from the publisher.