Do you get rich from being conservative with your money? ( not miserly )

[Ceiling Cat]

I know a woman that made large amounts of money 10 -12 years back, she spent money like there was no tomorrow. Now she is in deep financial trouble because she was not careful with her money. I am conservative with my money but do not cheap out. I have 6 cans of shaving cream and maybe 30 disposable razors. I buy when things are on special. For example I bought 4 short sleeve and 3 long sleeve shirts ( for winter ) and 3 pairs of pants at Marks because it was on special this week. I see it as paying yourself in the futue and having more opportunities open to you because you have the bucks in your pocket to make choices.

BTW- I will not be going to Jam Jam this year. ( or anytime soon )

Remember the story of the butterfly and the bee?

The bee saved up his honey and lived the winter comfortably in his condo and drove a recent model BMW, and the butterfly spent all her money aand dies outside in the cold cold winter.

 

[RAWD]

Hey, the rich don't get wealthy by giving it away.

I'm the same way as you. I hate paying retail and I hate "having" to buy things. I try to plan what I need/want and bid my time for a sale.

That's why I buy my wine in cases

 

[The Options Menu]

I wouldn't say rich, but it does make me a lot more free. Many of my peers have leveraged themselves to the nines-- They lease or buy a car, get that condo with the association fees, feel compelled to get 'new stuff' on credit, etc. The one thing that most of them have in common is that they are comparatively miserable. My rental based TTC taking ass if free to save for the short and long term, free to blow money on silly things like SCs, free to walk away from jobs, and can comfortably survive a job spontaneously going away. Most of these people will speak sternly about building equity and how big their credit is. That's nice. But I have cash, and access to credit has never been an issue. I wouldn't trade my life for any of theirs.

 

[Bear669]

No, but it can give you better opportunities to become rich

.........

The bee saved up his honey and lived the winter comfortably in his condo and drove a recent model BMW, and the butterfly spent all her money aand dies outside in the cold cold winter.

Speaking as a brilliant investor but a total wastrel-

There are several good comments above, but you only get RICH by luck (birth, lottery) or by hard work and smart investing. No risk , no wealth.

Prudent spending gives you the chance to save money and INVEST (in something).

Otherwise you may live happily, with less stress and be comfortable. But not $ rich.

 

[Mencken]

A person increases their wealth by how they spend .... not what they earn.

I think that is true to a point...in the low to mid range of earners. But to get really rich you have to make a lot.

In my own case if I had lived very very frugally perhaps I would have twice the net worth. But that still is much less than many people have by simply being in the right place at the right time and perhaps even owning beyond their means. Sometimes the idiot that bought the house that was far too large and that he couldn't really afford ended up making more on that than a lifetime of savings could have achieved.

 

[Brill]

Leveraging to the hilt at the right time is the fastest way to get rich or the fastest way to go broke.
You have to throw your conservatism out the window for this moment.

 

[out4fun]

You can save, be frugal and live within your means, but its not the road to riches. Real wealth takes a strong source of income, usually from hard work and risk exposure.

 

[pencilneckgeek2]

If your outgo exceeds your income, your upkeep will be your downfall .

 

[Nickelodeon]

Two things:

Even an average income earner can build wealth if he starts early: it's because of compound interest, divident reinvestment, growth of blue chip stocks....it just takes 25-30 years of saving.

You need to spend less than you earn. To paraphase Charles Dickens: If you regularly spend 5 cents more than you earn, you'll be in the poorhouse. If you spend 5 cents less than you earn, you will enjoy freedom. I think this might have been from Nicholas Nickleby.

 

[Master_Bates]

A person increases their wealth by how they spend .... not what they earn.

This is really the opposite of my beliefs... I know many people that curb their spending to meet their earnings.... For me, the better way is just to make more money to meet my spending needs.

Poor people work for their money... Rich people have their money work for them.

In addition to my full time job, I have investments pulling in several times my salary, which gets reinvested to make more....

 

[RAWD]

I think you're saying the same thing. Your form of spending is to invest.

Not everyone has the luxury of holding excess cash.

 

[smart_alek]

That's just playing with words. If you make more money than you spend, you are still spending less than you have.
Sounds a lot like the author of Rich Dad, Poor Dad.

 

[nosidam]

I saw a TV episode once saying that if you dry your disposable razors after you shave, they last a lot longer.

 

[Ceiling Cat]

I saw a TV episode once saying that if you dry your disposable razors after you shave, they last a lot longer.

It does last longer if you keep your razors dry, I keep my razors standing up in a glass when not in use and the water drips off by gravity. Cuts my annual razor purchases to two packs instead of six per year. Thats a $35-$40 saving. I figure I am saving $4000 - $5000
a year by being smart or buying before I need it.

 

[Master_Bates]

I think you're saying the same thing. Your form of spending is to invest.

Not everyone has the luxury of holding excess cash.

I think there's a key difference.... I'm saying that people should stop looking for ways to cut spending, but rather ways to make more money... and there are certainly ways to make money that take very little extra money that pay off bigtime

One example... If you have a basement that's unused or infrequently used, convert it to a basement apartment and make an extra $800-1500/month.

 

[lovedoc]

We can all learn from Granny here to be prudent with our money;

http://cosmos.bcst.yahoo.com/up/player/popup/index.php?rn=222562&cl=20253008&ch=&src=canadanews

 

[MissJasmine]

I think a person's age and earning potiential is everything. I started investing pretty young, have many working years left so although I do make the odd higher risk/shorter term choice, most of my investments are fairly conservative and hopefully the compound interest works for me. As far as spending goes sometimes you have to spend money to make money, and sometimes you have to be frugal. Year end numbers speak for themselves though

 

[Ceiling Cat]

Year end numbers speak for themselves though

I do not believe that there is a specific date in the year where you can look back and say that you investment has matured. I believe in the KO ( K. O`Leary ) philosophy that you should be paid to wait. ( dividends ) The bulk of my investments are dividend paying stock. I do invest a smaller portion in higher ( but manageable ) risk stocks.

 

[hinz]

We can all learn from Granny here to be prudent with our money;

http://cosmos.bcst.yahoo.com/up/player/popup/index.php?rn=222562&cl=20253008&ch=&src=canadanews

Amen.

Having said that, it's all academic when you blow too much cash on SPs/MPAs or cigarettes or booze or fast cars or any high lifestyles before you invest a dime. Even when you manage to accumulate substantial dough many are repeating mistakes by mixing up day trading/punting/speculating as investing.

BTW, I have yet to see any ladies, civilian or pro who could live as frugal as this granny.

 

[MissJasmine]

I do not believe that there is a specific date in the year where you can look back and say that you investment has matured. I believe in the KO ( K. O`Leary ) philosophy that you should be paid to wait. ( dividends ) The bulk of my investments are dividend paying stock. I do invest a smaller portion in higher ( but manageable ) risk stocks.

I agree with the KO philosophy as well and believe that patience with pay in the end.

What I meant by "year end numbers" is what someone is earning, spending and saving at the end of the year. Taking a good look at these numbers is the first step in helping a person choose an investment strategy that works best for them.