Yesterday, I was listening on the radio to my frugal mentor, Clark Howard, and he was talking about the millionaire next door. In particular, he was talking about the fact that there are ordinary people in America who are indeed millionaires. They became millionaires not from what they make each year, but rather from what they don’t spend. I love this principle and I wish more American adopted this lifestyle, rather than indulging their champagne tastes when in reality they should be on a beer budget. Which of course leads to debt and financial stress in your life.
According to Clark, here are 3 examples of how the millionaire next door lives their life.
1. Bottle of Wine. So when planning a dinner party, do you buy the $37 bottle of wine or the $13 bottle? The millionaire next door opts for $13 bottle every time.
2. The Wristwatch. You need a new watch. Do you buy the $50 watch or the $5,000 Rolex? This one is pretty obvious. Although Clark, who is no doubt a millionaire, says he bought his watch for $19.99. He must have found a great coupon!
3. The Automobile. Do you drive a luxury car or opt for the modest sedan? The millionaire next door cruises in the sedan and doesn’t worry about impressing somebody at a stoplight.
The bottomline: It is how you handle and save your money that really separates those with money and those who struggle with their finances. So think before you spend and never borrow or go into debt to impress others.
Please chime in with your thoughts. I look forward to reading your comments.