Automatic Millionaire Book Review

I recently read David Bach’s Automatic Millionaire: A Powerful One-Step Plan to Live and Finish Rich.

I’d have to say that this book has influenced me the most regarding managing my personal finances.

I picked it up again a week ago and would like to present a quick review here on PT Money. I know the book is a bit old (it was first published in 2004), but most of the material presented is timeless.


In the introduction, David gives his motivation for writing the book, as well as some motivation for you to read it. He also spills the beans…he shares that the “one-step” in his one-step plan is to “Make Your Financial Plan Automatic!” That’s it.

He goes on to say that the rest of the book will contain “action steps” to make this happen. So, while there are actually more steps to his plan, his title and approach provide emphasis (and marketing savvy) for getting the main point across, which is really pretty simple.

Be sure and read the philosophy behind The Automatic Millionaire, which is another paragraph in this section. Lastly, David shares a link to a free piece of audio you can access from his website.

Book Review of Automatic Millionaire

Chapter One – Meeting the Automatic Millionaire

In this chapter David shares the story of the first Automatic Millionaires he ever met, the McIntyres. They were able save enough to retire in their early fifties (with $2M in assets) making only around $50K annually. They did this by paying themselves first an average of 10% of their income and prepaying their mortgages by making a half a payment every two weeks.

The McIntyres shared that their most important secret was that they didn’t need will power or discipline because they made it automatic. They setup automatic payments from their paychecks to their retirement accounts and automatic payments on their mortgage.

David does a good job sharing this story of the McIntyres. While I didn’t necessarily identify with their situation, I got the point of the chapter and that is if someone making around 50K a year can do this by their early fifties, I can definitely do it.

Chapter Two – The Latte Factor®: Becoming an Automatic Millionaire on Just a Few Dollars a Day

If you’ve heard anything about from David Bach before, you’ve probably heard of The Latte Factor®. It’s kind of his bread and butter. Basically, he shares that by cutting out one little expense from your day (like your $3.50 latte) and saving that amount instead, you can amass millions for retirement.

The motivation behind this chapter is to eliminate any excuses you might have for not saving for your retirement. Also in this chapter, David shares a few time value of money charts and a one-day assignment to track your spending (worksheet included).

Chapter Three – Learn to Pay Yourself First

In this chapter, David shares that you can throw away your budget using his method. Then, he delves deeper into the concept of paying yourself first. He explains why it’s better to pay yourself before the government gets their due (taxes) and he gives you the basic concept of how it works.

There’s also an Automatic Millionaire Promise you can sign for extra motivation.

Chapter Four – Now Make it Automatic

If you only had time to read one chapter from David’s book, read this one. This is the real meat of the book. In this 50+ page chapter David gets specific about how you should make your retirement savings automatic.

He starts with people who have access to contribute to a 401K, then moves toward using a IRA where he talks Traditional vs. Roth IRA. Finally, David shares his thoughts on people who are self-employed and how they can make it automatic.

I like this chapter because it gets really specific giving web addresses and phone numbers of investment firms and brokerages. David also endorses balanced funds and asset allocation funds because of how easy they make it for you to invest.

Chapter Five – Automatic for a Rainy Day

In these last four chapters David takes his “pay yourself first” automatic method and applies it to four other areas of your personal finances. The first is emergency savings. His three rules in this area are to: decide how much money you need; don’t touch it; and put it in the right place.

David considers the right place to be money market accounts, or what are actually high-yield online savings accounts. Again, David gets specific at this point by listing out some accounts, along with web addresses, phone numbers, and investment minimums. Capital One 360 (which I thought was just a savings account, not a money market account) is listed first because of their no minimums.

Chapter Six – Automatic Debt-Free Homeownership

David is a strong proponent of owning vs renting and explains why in this chapter.  He also suggests that taking out a 100% loan, while risky, is a good option to get out of the rent race too quick. I wonder if he believes that way anymore in light of the current lending situation.

While he does share his thoughts on buying a home, this isn’t a buy a home guide. The real benefit of this chapter comes from his section on making biweekly mortgage payments and how that can help you own your home quicker (22 yrs vs. 30 yrs). If you’re a home owner or considering becoming one soon, this section is worth a look.

Chapter Seven – The Automatic Debt-Free Lifestyle

This chapter is really less about how to make automatic credit card payments, and more about why you should and how to get out of your debt.  If you need some extra motivation to get a handle on you out-of-control credit situation, this chapter will be beneficial.

Chapter Eight – Make a Difference with Automatic Tithing

David’s last chapter takes a step back from all this get rich talk and discusses the merits of tithing, how much you should tithe, and how to make it automatic. If you’re unsure of who you should give too, David provides a few examples.

A Final Word: Your Journey Begins Today!

In this final section, David sums up his message nicely and provides a last bit of motivation for getting started on your path to becoming an automatic millionaire.

My Thoughts on the Book

As I already shared above, this book has been very influential on me and my personal finance approach.  When I first read it, it either reinforced what I was currently doing or motivated me to begin some of the methods described within.

I really appreciate how specific David gets in the book and how simple he keeps the message.  I’d recommend The Automatic Millionaire to anyone looking for some practical application on simplifying their finances and leaving behind, forever, any excuse for not saving.

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About Philip Taylor, CPA

Philip Taylor, aka "PT", is a CPA, blogger, podcaster, husband, and father of three. PT is also the founder and CEO of the personal finance industry conference and trade show, FinCon. He created this website back in 2007 to share his advice on money, hold himself accountable (while paying off over $75k in debt), and to meet others passionate about moving toward financial independence. He uses Personal Capital to track his wealth. All the content on this blog is original and created or edited by PT.


  1. Halfapayment says helps you set p the automatic plan… Check it out

  2. This sounds like it is just up my alley. I’ve already got a couple of things on “automatic” such as deposits into savings, IRA, etc., but I have not really gone beyond that. Maybe there is hope for me to get out of debt and make a clean break sometime. Thanks.

  3. Sounds pretty good, I may have a look, though I am always skeptical of tithing….for obvious reasons.