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  • Writer's pictureDavid H. Kinder, RFC®, ChFC®, CLU®

"We [the lenders] own it all… all of it."

Updated: Jan 20, 2023

Today's blog post doesn't need much introduction. I'm just doing a copy/paste from the introductory chapter from Thomas J. Stanley's successor book to The Millionaire Next Door called The Millionaire Mind.

In the introduction chapter, Dr. Stanley is setting up the book. He has ten multimillionaires in a room to discuss how one can become an economic success.

Following this excerpt (with some bold emphasis in some parts), I have a short video clip at the bottom of this page.


There were many important points made about how one can become an economic success, but one statement was riveting. It was made by Gene. He mentioned that those who are “credit-dependent” are in fact controlled by someone else, some institution. Gene was in his late forties at the time. He listed his occupation as “owner of a salvage business.” He purchased or “salvaged” real estate from various financial institutions. These institutions “have loans that are in default… six months or more.”

Just a few weeks prior to the interview, Gene “salvaged” sixty-eight homes, a commercial shopping center, and five multifamily apartment complexes from a financial institution with which he’d had many previous dealings. Immediately after the deal was signed, the senior credit officer of the institution signaled to Gene and walked with him over to the large window in the officer’s top-floor office. It was a tall building—they could see for miles and miles. There were thousands upon thousands of commercial buildings all around. Gene could even see some of the residential neighborhoods on the horizon. As he looked out the window, the officer pointed to all the buildings, homes, offices, garages, shops, and so on, and said the words that made a lasting impression on Gene:

We [the lenders] own it all… all of it. The business out there?… You [borrowers] just run these businesses for us. You guys run them for us, the financial institutions.

How many people today in America run “their businesses,” “their professional practices” but actually work for or are being controlled by lenders? How many live in luxury homes yet work hard to make payments to the ultimate owner of the mortgage? How many people take care of autos they lease from the real owner? Too many. But Gene is not among them, nor were any of the other members of his focus group. All possessed the millionaire mind. None had a private credit officer doling out cash. All lived in fine homes, but not one had a “jumbo mortgage.”

The lesson I learned from Gene was repeated many times over by the millionaires surveyed for this book. They all have the millionaire mind, yet they believe it’s possible to enjoy life and still become wealthy. They believe that financial independence and much economic success can be achieved without adopting a Spartan lifestyle. But there must be certain constraints, as discussed later in this book.

Some people are not controlled by credit institutions. For them it is just the opposite—they are controlled by greed. They are misers. They even shortchange their spouses and children. Money is their God. These people are not of the millionaire mind. Another millionaire who has the proper perspective said:

I taught my sons and daughters that money is not their God. You control it… not let it control you.

Most of the people profiled in this book became economic successes in one generation. They came from economic ground zero. Most inherited no money. They never received the proceeds of an estate or income from a trust account. How did they do it? Again, they are of the millionaire mind. You may never be able to generate the sizable incomes that many of these millionaires have earned. You may not become a multimillionaire in a few short years. But you can still benefit from understanding how these people maintained an enjoyable lifestyle at the same time they were accumulating wealth. Only a few people, even those with high incomes, know how this can be accomplished. Those with the millionaire mind know how, and they are profiled in this book.

Stanley, Thomas J.. The Millionaire Mind (Millionaire Set) (p. 3). Rosetta Books. Kindle Edition.


Now, I'm not trying to tell anyone how to spend their money. And if your spending SERVES you and your business... even better. That's your business. However, those who 'overspend' - those whose eyes are bigger than their budget - aren't we (yes 'we' - been there) just end up being 'slaves to debt'? Even if we're very responsible and use credit as a tool - such as a business owner using it as a cash reserve to help make payroll during cash crunches - what happens if we don't or can't make our payments? Wouldn't the bank freeze that line of credit for a time? And if it's frozen, we eventually completely LOSE that tool? Doesn't that limit our ability to manage cash flow and take advantage of opportunities, let alone have that reserve for those cash crunches? Then what happens during the next economic crash when banks get scared and aren't lending any more money? Couldn't your business be on the line?

While I believe that one can live comfortably without credit cards, they are a great convenience with unmatched fraud protection. I wouldn't dare travel without credit cards. But if we abuse them, we could end up also having been 'slaves to debt'.

That chapter doesn't make this video from the 2009 "The Internationalist" so far fetched now, does it?



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