Business Book Review: The Automatic Millionaire by David Bach

What if getting rich could be easy? The Automatic Millionaire by David Bach explains how.

My Rating: ★★★★
Length: 288 pages
Publisher: Crown Currency
Released: 2016

Key Takeaways for Personal Branding

He’s the finance expert who made millions worldwide question the long-term consequences of their daily latte on their wealth. Where it all began for David Bach was The Automatic Millionaire.

In The Automatic Millionaire, Bach shares the secret to getting rich through his one-step plan - automate everything.

The concepts in The Automatic Millionaire are familiar across other personal finance books. For example, pay yourself first, make extra contributions to your retirement fund, own your own home, make fortnightly mortgage payments and reduce your daily expenses. What makes Bach’s book brilliant is his packaging and selling of the idea.

Bach sells the idea of becoming an automatic millionaire. He could have titled the book ‘How to Become a Millionaire’ or something similar, but this idea sells. As a thought leader, it’s engaging. It’s not just technical, it’s emotive and shows a transformation story for his audience.

Looking rich and being rich

Bach shares a memory of the clients who sparked his automatic millionaire mindset. The unassuming couple came into his office, and following his initial misconceptions of their wealth, he discovered them to be rich by most standards. Though they worked humble jobs and lived equally humble lives, through their habits and investing they were rich in all the assets that mattered. They didn’t look rich, but they were rich.

Later in the book, this notion is further emphasised by the popular Texan rhetoric:

“Big hat, no cattle.”

This describes someone who tries to look more than they are.

For me, as a personal brand coach, it’s a conflicting concept. I do believe in actually being valuable, as opposed to just looking rich. But, I also believe, that some personal branding is aspirational. It’s about embodying your ambitions until they become your reality.

You don’t need willpower or discipline

The biggest selling point of Bach’s The Automatic Millionaire for many is that it makes getting rich easy. More so, Bach proposes willpower and discipline will never work as it goes against our natural human inclinations to give in to our desires. Making everything that can be automatic, takes all the emotions out of your personal finance plan.

When it comes to personal branding and your work, this is a valuable takeaway. I often also advocate for automating as much as you can - your habits, your schedule, your tasks, your content. Take your ability to second-guess yourself out of the equation.

The Latte Factor

Bach shares the story that set the worldwide ‘The Latte Factor’ into motion. When challenged by an audience member once about how she could apply his financial advice on her already lean budget, he assessed her daily finances in front of the audience with a fine-tooth comb. Among other things, her daily latte habit was a standout. And his calculations showed the long-term impact on her wealth of even such a seemingly insignificant purchase.

The Latte Factor is a concept that is criticised as much as it's revered. Bach’s numbers speak for themselves. Small daily purchases add up to an eye-watering long-term opportunity cost. But, others argue an abundance mindset means you can enjoy all the things that make you happy, knowing more abundance will come to you. And to question the big things, not the small things that bring you joy.

Both views have merit. But to achieve a happy medium for your personal brand, I would personally propose being highly intentional about what your every daily joy is. Make some sacrifices for the long game, while also doing what you love most in the present.

The most brilliant minds in business thought leadership have advocated for automation of all kinds. Sometimes the popular advice is popular for a reason.

The Automatic Millionaire by David Bach: Available on Amazon.