$16 what most millionaires pay for a haircut (including tip)

There are many words to describe how so many people end up in financial trouble, but one stands out.

Pretenders.

Sure, sometimes bad things happen, and it's not your fault. But many of you -- and you know who you are -- are experiencing economic problems because you were pretending to be rich.

Thomas J. Stanley has been examining the truly rich for years. A former university professor, he's the co-author of one of my all-time favorite personal finance books, "The Millionaire Next Door." It should have a permanent spot in your home library.

Just before year's end, Stanley released "Stop Acting Rich . . . and Start Living Like a Real Millionaire" (Wiley, $26.95). I'm recommending this book as the February selection for the Color of Money Book Club.

The credit crisis and recession, Stanley says, have presented us with the opportunity to treat and cure the pretenders.

"But for the treatment to work, you must take a cold hard look at your balance sheet and at your life, and determine if you would be wealthier if you would stop acting rich," he writes.

In Stanley's new book, a millionaire is defined as someone with net-value investments of $1 million or more. The investments include cash, stocks, bonds, mutual funds and equity shares in a private business. The author said he eschewed the traditional way people calculate wealth, particularly as it relates to the value of a home. If your net worth was $1.5 million with 85 percent of that from your home, and the value of your home depreciated by 50 percent -- which it has for too many people -- then your wealth wasn't real.

Stanley's research does a great job of proving there's a big difference between income and net worth. Many pretenders have become very good at generating income and enjoying a high standard of living. But take this Stanley gem to the bank: "Those who are among the least productive in transforming their incomes into wealth are in the higher-status occupations."

What do we often tell a child who expresses an interest in teaching? "You won't get rich as a teacher."