The Automatic Millionaire by David Bach | APA Style Essay
The Automatic Millionaire is an 8-chapter book written by David Bach that contains action steps on how to make oneself a millionaire. The book is light to read, nothing cerebral, and just plain logic and some easy math. Each chapter has a subheading that gives the readers a head start on what is to be discussed to set expectations. A must-read!
Chapter 1 – Meeting the Automatic Millionaire
In this chapter, David introduces the McIntyres to the readers and how the couple was able to acquire assets in their early 50s amounting to $2 million with just $50,000 annual income. The secret shared was paying themselves 10% of their income first, on the average and prepaying their mortgages by making half-payments twice a month.
Chapter II – The Latte Factor: Becoming an Automatic Millionaire on Just a Few Dollars a Day
The chapter talks about cutting some usual expenses every day, especially those that can be eliminated. He describes that a day minus a latte can give you savings of $3.50 on the average. The concept of the Latte Factor is avoiding excuses not to save for retirement.
Chapter III – Learn to Pay Yourself First
David depicts that one’s budget can be thrown away by using this method. He advises to pay yourself first before anything else. Setting aside some amount every month is very important in order for you to invest. He explains the essence of this concept.
Chapter IV – Now Make It Automatic
In this chapter, David shows how you can make your retirement savings automatic. He also talks about the balanced funds and how to allocate assets in order for you to see how easy it is to invest. He also discusses those who are self-employed and how they are able to it automatic.
Chapter V – Automatic for a Rainy Day
The application of “pay yourself first” automatic method is discussed in this chapter. David also applies this to the four areas of one’s personal life. Emergency savings is one of which and the three rules are: decide how much is needed, don’t touch it and put it in the right place. David considers money market accounts to be the right place. He also cited web addresses, contact numbers and investment minimums.
Chapter VI – Automatic Debt-Free Homeownership
David suggests in this chapter to own a house instead of renting. There are ways in order to own a house on a very affordable down payment and monthly rates. (rent-to-own) This chapter is very helpful for those who have a home or will have a home in the near future.
Chapter VII – The Automatic Debt-Free Lifestyle
This chapter is beneficial to those who are having tough times getting out of debt. Though he doesn’t give much advice on how to make credit card payments, he gives a motivation on how to handle debts well.
Chapter VIII – Make a Difference with Automatic Tithing
This serves as the last chapter of his book and steps back from the rich-talk discussions and talks about the benefits of tithing. He also provides a few examples of how to do it and to whom it should be given.
I like the book in general and I actually have none that I don’t agree with. If there is, it may be just the last part, tithing, since I don’t have much to give. I intend to apply everything that I can apply in my life especially the Latte Factor since there are a lot of unnecessary expenses we make. In my current status, I like the $3.50-Latte-Factor savings because it is applicable to me.
Bach, D. (2004). The automatic millionaire: A powerful one-step plan to live and finish rich.
New York: Broadway Books.