The Automatic Millionaire: A Powerful One-Step Plan to Live and Finish Rich [Paperback]

David Bach (Author)

Book Description

Publication Date: December 27, 2005

What’s the secret to becoming a millionaire?

For years people have asked David Bach, the national bestselling author of Smart Women Finish Rich, Smart Couples Finish Rich, and The Finish Rich Workbook, what’s the real secret to getting rich? What’s the one thing I need to do?

Now, in The Automatic Millionaire, David Bach is sharing that secret.

The Automatic Millionaire starts with the powerful story of an average American
couple--he’s a low-level manager, she’s a beautician--whose joint income never exceeds $55,000 a year, yet who somehow manage to own two homes debt-free, put two kids through college, and retire at 55 with more than $1 million in savings. Through their story you’ll learn the surprising fact that you cannot get rich with a budget! You have to have a plan to pay yourself first that is totally automatic, a plan that will automatically secure your future and pay for your present.

What makes The Automatic Millionaire unique:

You don’t need a budget
You don’t need willpower
You don’t need to make a lot of money
You don’t need to be that interested in money
You can set up the plan in an hour

David Bach gives you a totally realistic system, based on timeless principles, with everything you need to know, including phone numbers and websites, so you can put the secret to becoming an Automatic Millionaire in place from the comfort of your own home.

This one little book has the power to secure your financial future. Do it once--the rest is automatic!

Editorial Reviews

Amazon.com Review

Despite its sensational title, David Bach's The Automatic Millionaire: A Powerful One-Step Plan to Live and Finish Rich is not a get-rich-quick guide. Rather, the book is a straightforward march through common-sense personal financial planning that suggests readers "automate" their contributions to retirement and investment vehicles. Bach, in fact, calls his model the "tortoise approach" to becoming wealthy by retirement age.

In the early part of the book Bach builds on ideas he established in Smart Women Finish Rich and other bestselling titles. His core principle is that, to succeed, you must "Pay Yourself First." In other words, he suggests using pre-tax retirement accounts (e.g. 401(k)s or IRAs) to set aside a fixed, monthly sum of money before considering what is left for living expenses. The "automatic" part of the title comes from Bach's emphasis on using automated payroll deductions to avoid the temptation of using the money to pay today's bills.

Bach insists that "regardless of the size of your paycheck, you probably already make enough money to become rich." But his claims that his plan requires "no budget, no discipline," is a bit disingenuous. His discussion of the "The Latte Factor" shows that, to find money to start a retirement plan, a person with a modest income needs to make an up-front commitment to stop accruing debt and to reduce spending on such "wasteful" items as lattes and cigarettes.

In the end The Automatic Millionaire does not offer much that is new for readers already familiar with personal finance basics like accelerated mortgage payments, "the miracle of compound interest," and the setting up of emergency funds. But, for those just starting with financial planning, Bach provides a host of resources to put recommendations into action. He walks his readers through such fundamentals as shopping for interest rates, creating a balanced retirement portfolio, and consolidating debt. And Bach's conversational style will make this quick read highly palatable for those daunted by more detailed investment and personal finance titles. --Patrick O'Kelley

From Publishers Weekly

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.
Copyright © Reed Business Information, a division of Reed Elsevier Inc. All rights reserved. --This text refers to the Hardcover edition.

See all Editorial Reviews

Product Details

• Paperback: 272 pages
• Publisher: Crown Business (December 27, 2005)
• Language: English
• ISBN-10: 0767923820
• ISBN-13: 978-0767923828
• Product Dimensions: 5.2 x 0.7 x 8 inches
• Shipping Weight: 4 ounces (View shipping rates and policies)
• Average Customer Review: 4.0 out of 5 stars  See all reviews (333 customer reviews)
• Amazon Best Sellers Rank: #8,494 in Books (See Top 100 in Books)
  • #92 in Books > Business & Investing > Management & Leadership > Motivational
  • #98 in Books > Business & Investing > Personal Finance

More About the Author

David Bach has helped millions of people around the world take action to live and finish rich. He is one of the most popular and prolific financial authors of our time with nine consecutive national bestsellers, including two consecutive #1 New York Times bestsellers, Start Late, Finish Rich and The Automatic Millionaire as well as the national and international bestsellers Fight for Your Money, Go Green, Live Rich, The Automatic Millionaire Homeowner, Smart Women Finish Rich, Smart Couples Finish Rich, The Finish Rich Workbook and The Automatic Millionaire Workbook. Bach carries the unique distinction of having had four of his books appear simultaneously on the Wall Street Journal, BusinessWeek, and USA Today bestseller lists. In addition, four of Bach's books were named to USA Today's Best Sellers of the Year list for 2004. In all, his FinishRich Books have been published in more than 15 languages, with more than seven million copies in print worldwide.

Bach's breakout book The Automatic Millionaire was the #1 Business book of 2004, according to Business Week. It spent fourteen weeks on the New York Times bestseller list and was simultaneously number one on the bestseller lists of the New York Times, Business Week, USA Today, and The Wall Street Journal. With over a million copies in print, this simple powerful book has been translated into 12 languages and has inspired thousands around the world to save money automatically.

Bach's newest book, Start Over Finish Rich launches in December 2009. With its ten crucial moves you must make in 2010, Start Over Finish Rich provides the essential tools for readers to get back on track financially and recapture their dreams of a richer future.


Bach is regularly featured in the media. He has appeared six times on The Oprah Winfrey Show to share his strategies for living and finishing rich along with regular appearances on NBC's Today and Weekend Today shows, CNN's Larry King Live, ABC's Live with Regis and Kelly, The View, CBS's Early Show, ABC News, Fox News, and CNBC. He has been profiled in many major publications, including The New York Times, BusinessWeek, USA Today, People, Reader's Digest, Time, Financial Times, the Washington Post, The Wall Street Journal, Los Angeles Times, San Francisco Chronicle, Working Woman, Glamour, Family Circle, and Redbook. He has been a contributor to Redbook Magazine, Smart Money Magazine, Yahoo Finance and AOL Money. In 2009 Bach, was a regular on the Today Show Money 911 Segments and a contributor to ABC's Good Money.

David Bach is the creator of the FinishRich® Seminar series, which highlights his quick and easy-to-follow financial strategies. In just the last few years, more than half a million people have learned how to take financial action to live a life in line with their values by attending his Smart Women Finish Rich®, Smart Couples Finish Rich® , and Find The Money Seminars, which have been taught in more than 2,000 cities throughout North America by thousands of financial advisors.

A renowned motivational and financial speaker, Bach regularly presents seminars for and delivers keynote addresses to the world's leading financial service firms, Fortune 500 companies, universities, and national conferences. He is the founder and Chairman of FinishRich Media, a company dedicated to revolutionizing the way people learn about money. Prior to founding FinishRich Media, he was a senior vice president of Morgan Stanley and a partner of The Bach Group, which during his tenure (1993 to 2001) managed more than half a billion dollars for individual investors.

As part of his mission, David Bach is involved with many worthwhile causes including serving on the board for Habitat for Humanity New York and co-founding Makers of Memories, a charity organization dedicated to helping women and children who are victims of domestic violence.

David Bach lives in New York. Please visit his web site at http://www.finishrich.com

Customer Reviews

Most Helpful Customer Reviews

127 of 131 people found the following review helpful:

5.0 out of 5 stars So simple that it looks too simple, January 29, 2004

By A Customer

This review is from: The Automatic Millionaire : A Powerful One-Step Plan to Live and Finish Rich (Hardcover)

To many people, The Automatic Millonaire looks too simple to be believable. Nothing could be that simple right?Yes and No. It is simple. EASY TO UNDERSTAND AND EASY TO DO, BUT HOW MANY PEOPLE DO IT?Save 10% of what you make. Use biweekly mortgages. Make extra principal payments. Make extra payments on your credit cards. Is it really this simple? Absolutely.I am now giving this book away as an accessary gift at weddings and birthdays. Automatic Millionaire is also an easy read.

133 of 138 people found the following review helpful:

5.0 out of 5 stars Not necessarily new, but worth reminding, February 7, 2004

By 

Mark Forrester "a proud American" (USA) - See all my reviews

This review is from: The Automatic Millionaire : A Powerful One-Step Plan to Live and Finish Rich (Hardcover)

Some of what Dave Bach talks about here is not new. And that should not be news to anyone who has actually read the book, not just the free stuff on the internet and wanted to write a review and state their opinion.

I had an uncle who sold insurance and he always taught us to save 10% of our money. He taught this to his kids and he taught it to his nephews and nieces too. Guess how many did it?

In The Automatic Millionaire, Bach's core principle is to pay yourself first. Stanley and Danko talk about this in The Millionaire Next Door. Givens taught this in More Wealth Without Risk and George Clason is perhaps the best known for teaching this in The Richest Man in Bablyon. Once again, it's not news, but how many people do it?

Bach suggests using pretax retirement accounts like your 401 (k), IRA, SEP-IRA, ROTH IRA, SOLO 401 (k) to set aside a fixed monthly sum of money before considering what is left for living expences.

By taking advantage of payroll deductions, money can be invested automatically and you won't even miss it. For example, employees can have money automatically going into their companies 401 (k) and through money link have money going into their IRA. Just like a bill, except you are paying yourself first.

By contributing to an IRA, you can also complete a new w-4 and claim your IRA increasing your take home pay while you increase your investments.

Thanks to Pres. Bush's plan to raise the amount that can be contributed to retirement plans and makeup provisions, Americans have the best opportunity ever to create tax deferred wealth.

The other principle that Bach talks about is his "latte factor."
Bach insists that many people are wasting money on "lattes." Got to have that bottled water, go out for lunch everyday, hit the soda machine several times per day, cigerettes, candy, stop at a 7-11 for gas and got to get a snack, buy something new to keep up with our peers etc., etc.

And these are the people that say they have no money to invest. In this regard, people are wasting money just to live a little better than they should be.

And I am not pointing fingers. I was there too and I had training! 19 years ago, I started accumating wealth and self help books. One of the first was The Richest Man in Bablyon. I made dramatic progress. Then around 4 years ago, after years of being sloppy, I lost it. I felt that I had read it all, been there done that. I gave my books away. Amazing when you think you know it all, you really don't and horrible things start to happen.

I was living on 125% of income. When my company closed down, I had to raid my 401 (k) and IRA accounts untill they were gone. Then reality set in and I had to start over.

People who think they have already heard this before, how are you doing financially? Truthfully. My guess is that many are living in denial. If you are already doing well, congratulations. You are one of the few that are.

Getting back to The Automatic Millionaire, Bach reveals "regardless of the size of your paycheck, you probably already make enough to become rich." Bach goes on to say that his plan requires "no budget, no discipline," is a bit disingenuous i.e. his "latte factor" A person with a modest income needs to make an up front committment to stop acruing debt, to reduce spending on such wasteful items as lattes and cigerettes and to begin investing.

Fans of 1,000 page financial books (mostly worthless filler) will probably find Bach's book vanilla, too simple, too easy. But guys, it's working. It's what people really need. Not a huge 1,000 page tome that people won't read and doesn't work anyway.

I highly recommend The Automatic Millionaire that will set you on the road to wealth and show you how to make the most of your money automatically.

131 of 137 people found the following review helpful:

4.0 out of 5 stars You either like it or hate it - mixed reviews, January 15, 2004

By A Customer

This review is from: The Automatic Millionaire : A Powerful One-Step Plan to Live and Finish Rich (Hardcover)

I saw Dave Bach on the Ophrah show a couple of nites ago. I agree that much of what Bach says is not new but that doesn't make it a bad read.

Sometimes the best advice is what we already know. Some people need to be reminded to pay ourselves first. That it is okay to invest while you are in debt. And that simple things like a bi-weekly mortgage which you can do on own (some unscrupulous companies charge $400 or more for this service + additional fees)can save you 5 years of mortgage payments.

Bach recommends no load mutual funds (no doubt this upsets commissioned brokers and advisors)and other advice that takes money out of the pockets of sales people and puts it right back in ours.

Some of what BAch says has been covered in his other books, but again, sometime we need to be reminded and what if you didn't buy those earlier books?

I highly recommend The Automatic Millionaire. Title is very appealing and the book really works.