The secret to becoming a millionaire!
I’m going to ruin your day right now. I Lied.
There is no secret to saving money, or becoming wealthy (whatever that word means, any more). Nearly every money saving tip can be categorized in one of three areas:
- Need/Use less
- Buy at the best price you can
- Do it yourself
Not surprisingly, the best way to save money is simply to spend less of it relative to how much you make. This isn’t rocket science. The first one, is need less. Don’t need a new phone (even if you can get one every 2 years). Don’t need new clothing. Obviously there are times when you need to get a pair of pants, or a shirt, but you don’t need a new one every week, month, or season. I own jeans that i’ve had for 3 years, and that’s not even that long. Don’t need certain food- when you go to the grocery store, don’t go in knowing you need “Cheetoes” or “Ruffles.” Go in knowing you want snacks. And then go about shopping for snacks that are the most economical.
This brings us to point two, when you need to, buy things at the best price. In the snack example above, pretzels might be on sale, or hey, maybe Ruffles are, too! It’s exciting when it works out that what you want and what’s on sale is the same price. Other areas to get better prices are on insurance (shop around), buying cars (wait for major holidays, or buy used) and housewares (buy quality, read reviews). There are a million of ways to save a buck if you’re into that, but the basis of it is that you just need to save money on something you would have bought at a higher price.
As an aside, it’s only a deal if it’s something you need. It might be a deal if it’s something you want, but i’ve seen so many people convince themselves they want something because of a sale. If you don’t need a new pair of shoes, don’t buy them simply because they are on sale. Whenever I point this out to people, I always get “It’s just shoes,” but “just shoes” and “just a few CDs” just becomes no left over money at the end of the Month.
Lastly, do it your self. I’m not talking of thousands of dollars renovations- only you can be the one qualified to tell yourself you can or can’t do that. I’m speaking about simple, every day things. Cooking your own meals, cleaning your own house, doing your own oil changes and tire rotations. All of these things are simple enough to do, and can save you a lot of money. I won’t fill this with qualifiers except one: I think it’s OK to spend money on services, and I do it too. Usually when my time is more valuable than learning/doing it myself.
The other side of this “building wealth” coin (forgive the pun) is just as important as getting there- defining wealth. Wealth in America has become synonymous with status. Wealthy people don’t drive Hondas, they don’t wear old clothing unless it’s “vintage,” and I quote that because I don’t think many people know what vintage means (hint: it’s not simply old). Wealthy people don’t drive to their vacation destinations, and they always enjoy the finest things in life.
Sure. Some wealthy people do that, but if that’s the definition of wealthy we’re using, then I think we’re all in trouble. And the ones that can have it will, and the ones that want it will use their credit cards to have it for a brief while.
No, wealth is a relative term, and that’s the problem. We are being constantly bombarded with advertising and television shows telling us how we should spend the money we (don’t?) have. Maybe it’s a 50 thousand dollar car, or a show where all the housewives get diamonds simply for having kids. And what do people who are diligent with their savings get? We’re boring cheapskates! We’re told to spend the money and live in the now! I agree with that, I want to enjoy my time during and after I work. Who would think otherwise?
But wealth is more than money, more than status. It’s living comfortably and being able to do what you want. Working or not working, simply because you choose. It’s being able to sit down and write a novel, take some photographs, or bake cookies all day if you want. It’s going boating or fishing or, hell, just sitting around watching movies all day.
What i’m trying to say is building wealth is a lot easier to do if you define what it means to you, and then make it happen. Don’t pay attention to advertisers or people you know telling you things. This does not mean limit your dreams or goals, just know that the grander they are, the longer i may take, or there more sacrifices there will be- perhaps both.