Live a comfortable life, not a wasteful one. Do not spend to impress others. Do not live life trying to fool yourself into thinking wealth is measured in material objects. Manage your money wisely
so your money does not manage you. Always live well below your means.
A penny saved is a penny earned.
– Benjamin Franklin
- Redefine your definition of “rich”. – I remember sitting in a cubicle at my first professional job staring at a picture of an SUV I wanted to buy (and eventually did). Now, I sit in my office and look at the pictures of my kids, and just outside my window I can see the beater I drive sitting in the company parking lot. What a difference a decade makes! To sum things up, my definition of being rich is having enough money to meet my family’s basic needs, a few of our wants, and to be able to give some away to others.
- Borrow and share. Everyone wins! – We borrowed a DVD from a friend instead of renting or buying and had a little snack from our own fridge! Way cheaper than using gas to drive to the theater/rental place, paying for a movie or Amazon Prime, and paying for a snack.
- Avoid the mall. – Going to the mall is not entertainment! We used to go when we were bored. Of course, we usually ended up spending money while we were there. If you need clothes, then shop sales or go to stores that offer name-brands at a discount. You can save a ton on these items if you are a smart shopper. Dave Ramsey says, “Never pay retail!” We probably save $15 to $30 per month by staying away from the mall.
- Limit your intake of advertisements. – Advertising sucks. That’s the cold, hard truth. It’s engineered to make you feel like you’re incomplete, that you have an unfulfilled need, that you’re not good enough.
- Buy with cash. – You can’t spend money you don’t have. Many bank accounts provide overdraft protection, so even with a debit card, it’s easier to go over your account balance than you think.
- Find a better deal and actually SAVE the difference. – Regardless of what they sell, if you’ve switched companies for price reasons, save the difference. Think of phone companies, internet access, cell phones, credit cards, and others.
- Adhere to a long-term investment strategy. – I’m a long-term investor. The stock portion of my portfolio is spread over several mutual funds, a few ETFs and a few individual stocks. Each and every one of these holdings was carefully chosen, after thorough research. I believe in these stocks and funds. I consider them as my best bet in growing my money – LONG TERM.
- Curb your consumerism! – Have you ever watched how a child can play with a cardboard box for hours, and leave the toy that came in it by the wayside? How is it that children can enjoy themselves without a lot of “stuff”, but we as adults feel the need to reward ourselves by buying more stuff?
- Stay Healthy! Medical problems drain bank accounts. – James M. Rippe, M.D is a best-selling author, world-renowned cardiologist, and founder of the Rippe Lifestyle Institute. He explains that if you look at all the risk factors for dying, the one that is most predictive is fitness level. In addition, an older person with high cardiovascular fitness is healthier than a younger person who is physically inactive. By increasing your fitness level, you can actually roll back your biological clock.
- Stay in and relax. – So, think about it the next time you go out. Are you going for with a purpose? Maybe the solution is to not go out at all. Stay home and save! Save up for something you really want or need.
- Gradually prepare yourself for a rainy day. – Even when things are going great, and you feel on top of the world, you must always be prepared for a change. If you take the time and patience to set yourself up properly, then when things to take a turn for the worse, you will be prepared to handle it. If you live above your means, then when the slightest change occurs, you will not be prepared to adapt. Financial flexibility is more important then keeping up with the Jones’.
- Stop competing. Forget about the Jones’ altogether. – If getting rich makes us happy, then why don’t countries as a whole get happier as they grow wealthier? They discovered that as a country gets wealthier there’s no overall increase in happiness. Why? We continually compare our wealth against that of others. We are competitive and envious. Add to that the fact that Western countries encourage people to strive for more and more, and you have a formula that spins many into depression.
- Get out of the “easy street” mentality. – I think there is too much emphasis on the quick fix or the easy option in today’s society. For example taking diet pills to lose weight instead of the “hard option” – exercising and eating well…. money is sometimes being used as a substitute for hard work. Do you think there is an increasing expectation that you can get want you want by throwing money around instead of working hard and “earning” it?
- Avoid impulse buying. Buy things you truly need. – Don’t you just love the excitement you feel after coming home with a new TV? Driving home in a new car? Opening the box on a new pair of shoes? I sure do. But, from watching the behavior of myself and my friends I’ve found that the new quickly becomes just another item. The excitement of novelty passes quickly.
- Time is money. Properly manage your time. – The fewer tasks you have, the less you have to do to organize them. Focus only on those tasks that give you the absolute most return on your time investment, and you will become more productive and have less to do. You will need only the simplest tools and system, and you will be much less stressed. I think that’s a winning combination. Focus always on simplifying, reducing, eliminating. And keep your focus on what’s important. Everything else is easy.
- Find ways to give without spending. – Want a quick, easy and (almost) free way to be guaranteed that you’ll make someone’s day special? Send them a letter. Why not set aside some time this weekend to sit down and write to a few people? If you don’t enjoy writing, try buying some nice postcards of your home town. If you’ve got an artistic streak, why not design your own note cards? You don’t have to write a long letter for it to be effective. It’s the thought that counts and the personal touch that makes it special.
- Don’t let greed and deceit get the best of you. – According to Stephen R. Covey, if you reach an admirable end through the wrong means it will ultimately turn to dust in your hands. This is due to unintended consequences that are not seen or evident at first. The example he gives in The 8th Habit
is: The parent who yells at their kids to clean their rooms will accomplish the end of having a clean room. But this very means has the potential to negatively affect relationships, and it is unlikely the room will stay clean when the parent leaves town for a few days. Now, to return to the topic of wealth, I think it is possible to see much of the world’s current financial problems as stemming from people who wrongly believe the ends justify the means. My advice? It is fine to aspire to wealth, but don’t lose sight of the means to accomplishing it. - Never ever pay retail. – You can easily save hundreds of dollars a year on clothing purchases by waiting for sales or shopping at discount retailers like Marshalls. Better yet, avoid name brand clothing all together.
is: The parent who yells at their kids to clean their rooms will accomplish the end of having a clean room. But this very means has the potential to negatively affect relationships, and it is unlikely the room will stay clean when the parent leaves town for a few days. Now, to return to the topic of wealth, I think it is possible to see much of the world’s current financial problems as stemming from people who wrongly believe the ends justify the means. My advice? It is fine to aspire to wealth, but don’t lose sight of the means to accomplishing it.Also, check out these best selling books for more financial tips:
- I Will Teach You To Be Rich
- The Money Book for the Young, Fabulous, & Broke
- The 4-Hour Workweek: Escape 9-5, Live Anywhere, and Join the New Rich
Photo by: CayUSA
Lance says
Another great set of links – and perfect timing with all the bad economic news recently. It’s good for us all to remember that by living below our means, we really give ourselves an opportunity for a rich and rewarding future.
Thanks for including me amongst these other great articles!
Jeff@MySuperChargedLife says
Marc – Great collection of tips for living more frugally! Thanks for linking up to my article!
Tsh says
Excellent resource of links. And thanks for including mine!
Lin Burress says
Excellent advice Marc, as it applies to everyone who hasn’t learned how to live within their means, and especially grown, adult children who spend their own money frivolously and expect their parents to “help” on a regular, routine basis.
The “entitlement epidemic” is running rampant across America and now we’re all seeing the damaging affects entitlement has on people. If you can’t afford it, don’t buy it.
Grown, adult children who spend their own money on fun, entertainment, manicures and pedicures, clothes and movies etc and go running to “the bank of mom and dad” really need to learn some hard tough lessons by parents who finally stop enabling their children.
Vered - MomGrind says
This is great! I’m familiar with many of these articles, but not all of them. Off to check out Simple Mom’s article. 🙂
Thank you for including me.
Marelisa says
Hi, lots of good resources here, thank you for the link. I think a lot of people use “stuff” in order to make themselves feel better instead of looking to create purpose in their lives through the pursuit of meaningful goals that allow them to express who they are and play to their strengths.
Nathalie Lussier from Billionaire Woman says
This is a great resource for anyone looking to think long term. I love it! Thanks for including me. 🙂
Peter | The Change Blog says
Thanks for the mention Marc! There is some very solid advice in this article. Your last point was relevant for me today – I was looking for some new clothes but when it came to making a decision I couldn’t justify paying the full price.
Nameless says
Not bad. This advice has some merit… although there is much more to be said about living below your means.
Marc says
@All: Thanks for the kind words.
@Nameless: I agree. There’s a lot more to be said about living below your means. This article just wets the appetite.
Jo says
OMG, you all miss the point! You are creating the recession. Spend!
Just spend on what brings you pleasure and meaning?
Cut out the rubbish because it wasn’t fun anyway.
So don’t have fast food – stay home and have delicious real food. And invite your neighbours and cook double and treble.
Use the recession to cut out the sleepwalking and start living
But don’t stop spending. The economy relies on the money going around and around.
Leanne Magraith | Forever Change says
Some good links here -thanks for including my site amongst these.
Jo has a good point. If lots of people were to retreat into their shell in terms of sepnding, then the recession could deepen. Spend but spend carefully is the way to go!
DIY Dollars says
1) Read books on wealth management, investing, and personal growth. Be educated! 2) Pay yourself first. This doesn’t mean buy yourself something; it means invest part of what you earned.
LiveWellSimply says
It confuses and amazes me to watch teenage friends of mine ignore #3. They’ll go to the mall with only a few dollars to their name and spend it on name brand paraphernalia that they won’t even be using in year because it’s outdated or worn out.
PJ_Normz says
Adding to #18, a wise man once said “a rich man never buys anything at market value.”
Now, if only I could figure out who that person was, it would be the icing on the cake. 🙂
Great post.
Kevin says
Way to live life
Will says
Some decent tips, but basically common sense as far as I’m concerned. One thing I’d agree on is wealth.
The measure of a man isn’t the amount of money he makes or the power he has. It’s being able to use his God given gifts to provide for his family, help his friends and take car of himself.
However you don’t have to live a life of self restraint. Just live and enjoy it no matter what.
I and my family enjoy driving our ’98 Dodge Durango even though lots of people think it’s extravagant or something we don’t really need.
We don’t care, we like it and don’t give a hoot what anyone else thinks.
Mechner says
Great tips, #5 is best to avoid debt or ruining your credit, unfortunately the convenience outweighs the risk for most. Other ways are also that you can work to cut down your expenses.
Mike says
And in other news, grass is green, the sky is blue.. and oh….. thanks to capaitan obvious for the list
Bob Dobbs says
Always pay cash? Try buying something that costs a grand or more. Or a car. Credit cards are not evil. Only their misuse is evil. Pay off your balance every month and you will get a free 30 day loan from the bank and avoid getting mugged for cash. And you will look a lot more respectable. If you can’t control your spending you will probably blow all your cash on rubbish and finish the month in the red. A little self-control works better than cutting up your cards.
Niran says
This business about spending to avoid a recession – governments , companies and people were spending like crazy before. Now, 700 billion later, people have to spend more ? I think the way the economy runs needs rethinking, rather than the same old spend to get out of trouble mentality which did not work in the first place.
Joe | A New Band A Day.com says
Good advice here – thanks. If you focus on the value and not the cost, you’ll start to look at what things mean to you, and possessions are not often a big part of that. Fewer possessions = less expenditure.
Deep, maaaan.
Mike says
These are mostly well known and obvious, but I have to take issue with number 7. The past 10 years have taught us that buy and hold “investing” in stocks, mutual funds or ETFs is for suckers. The data that “Mom” quotes regarding long term S&P returns is a year old (when the S&P was at an all time artificial bubble high) and is misleading and wrong.
If you can devote your life to being a professional trader, you can make some nice gains in the equity markets. But remember, it’s a zero sum game. For every dollar won there is a dollar lost. Joe Six Pack should not be competing against hedge fund managers in that zero fund game. He will lose every time.
David S. says
Great links, thanks. I’d add two other ideas, though.
One is hinted at in some of them: appreciate what you already HAVE.
And the second is even simpler: the public library for free books, free DVDs, free music.
Max says
I wanted to add another one: Stop Junk Mail that kills 100 million trees a year, wastes 8 month of average American life and another waste of 350 million tax dollars annually to deal with junk mail.
I did it. It worked.
I check my mail twice a month now and there is only few letters.
http://awakening.weebly.com/stop-junk-mail.html
Max Bottaro says
I like this post a lot. I wrote one myself about not letting money be your primary motivator. Still, I think there is a line that has to be drawn. I just want to be at the point where I can look at a menu and decide based only on what I want– I don’t even want to have to look at the prices.
I think it’s easy to say “oh, money shouldn’t matter, it’s not what’s important in life”; but when you grow up in poverty its very real. Poverty is an acid that eats away at your self esteem and wears down.
I think money is the most important thing to me right now (granted I have my health) and I don’t think that makes me a bad person– its just how I was programmed. Once I get comfortable I can step back, take a new perspective, and tell other people they shouldn’t trip off money. But you can’t tell a poor person money isn’t important- it’s like telling a starving man that the chicken’s a little dry tonight; you should just pass.
David Banos says
I finally have gotten over the mentality of buying retail. I used to use the net only to purchase tech items but now even buy clothes online at great prices. I also enjoy donating and shopping at thrift stores and recycling items.
Jeremy Day says
Hi guys,
Love this post. Love how you gave a shout out to all the other inspiring blogs out there. I think you should keep doing similar posts like this in the future.
Cheers,
Jeremy
Prawiro says
I wondered around the blogosphere and stuck in your site. This is awesome, rich content, very valuable.
Success Professor - Danny Gamache says
Excellent list. Such a wonderful collection of posts and advice.
My favorite advice is #5 – buy with cash. Not only is it valuable for the reasons listed, but people also tend to spend a lot less with cash than they do when using credit card, or even debit card. There is a significant emotional attachment to spending cash.
I would add one more to the list. Develop a simple budget that is easy to follow. I wrote about that idea here:
http://successprofessor.ca/2008/09/24/simplify-your-budget/
Virilitas says
Thank you, Sir, for the enjoyable links.
Bamboo Forest says
I think frugal dad’s sentiments are great. I think that’s pretty much how I feel.
This is a great list. Going to my Delicious account.
Monica says
Great idea for an article, it’s all about community!
A terrific list as well. I will keep coming back to this. Stumbled!
RDS says
Great tips. I especially find that number 3 is true. In the summer, I bike to work. In the winter, I ride the bus. In order to get from the bus stop to my office I walk through the entire length of my city’s major downtown mall. It is amazing how much more I think about buy new clothes and other new things during the winter as I walk by all those stores.
RDS
http://www.smartfinancialvalues.com
melissa @ the inspired room says
Great tips! I sure have adjusted my perspective on what I really need to be happy in life in the past decade. Thanks for all the helpful hints.
Melissa
Carrie says
The best piece of advice I ever heard for living simply in regard to money was, “Watch your pennies and your dollars will watch themselves.”
By making a conscience choice to not nickel and dime myself to death, I find myself not spending my dollars. I do this by allowing myself only $10 a week in cash for all the “little expenses” like coffee, gum, lunch out at work, etc. When the cash is gone, it’s gone. I save my debit card for the larger expenses only, such as gas and groceries.
The amount you allow yourself is up to you, but if you stick to your “rules” the amount you save each week by watching the pennies really adds up to dollars.
greg says
Great tips. My favorite is buy with cash. I pull out my cash at the beginning of the month and use the envelope system for everything but my mortgage, utilities and gas.
When you go to the store it is amazing what you won’t buy when you are using cold hard cash. Try it…it took us about 3 months but now we always end up with extra money at the end of every month.
if you need additional help on this. Check out Dave Ramsey. http://www.daveramsey.com
good luck.
Bev says
“True contentment is not having everything you want, but learning to appreciate everything you have.”
Not my original quote, but one I happen to like. 🙂
Rita says
This is what our family did today. Early in the morning we took turns going for a run while the other tended to our son. Then we made our weekly Sunday breakfast of omelets and toast and sat at the kitchen table, talking and reading the news online. Then we went to church, where we were reminded of our priorities in life. We spent the early afternoon doing chores around the house, playing with the baby, and taking a nap. During the late afternoon we took our son for a walk on a nature trail in a nearby county park. We came home, fed the baby, and put him to bed, and then cooked and ate a healthful and yummy dinner together. Then I read to my husband from a Cormac McCarthy novel for an hour while we snuggled on the couch.
Other than the gas spent traveling to the nearby church and the park (probably 50 cents?), we spent no money. And we had a wonderful day together. This is a typical Sunday for us because long ago we realized what activities made us happy. Going for runs, spending time outdoors, cooking, reading, being with friends and family–these are the things that make us feel like we’ve actually done something. Our neighbors typical American pastimes of shopping and living in excess are unsatisfying for us.
We are in our mid 30s and have no debt and a paid off mortgage. I stay home with my son and my husband has a job that he loves, because long ago he was able to quit working at jobs that just pay the bills. We figured out in our early 20s that the things that make us happy are pretty cheap, so now we are way ahead of the game!
BTW, I NEVER browse catalogs or go window shopping at the mall. It’s amazing how quickly I start thinking that I need that stuff!
allthingsconsidered says
Great ideas here. It’s always good to be reminded on some basic things that we can do to change the way we look at money and things.
My tip: Don’t look at the Joneses to see what you don’t have. Look instead at yourself and see what you do. Eventually, what you will have is less debt and the freedom from feeling like you want more, more, more.
sarah says
why is paying with credit or a bank loan “more respectable” than paying with cash? even if you can pay it off immediately or at the end of the month, why do it? paying for something, even a car or a larger purchase, with a check or cash isn’t something you should feel uncomfortable or embarrassed about. when the time comes to purchase our next car, we fully intend to walk in with the checkbook and walk out with the title and the keys. credit cards and bank loans are not status symbols.
Marc says
@All: Wow! Thanks for all the insightful stories, tips and additions to the list. I enjoyed reading every one of them. 😉