Unfortunately most people don’t realize that the profile of the affluent is frugal, frugal, and frugal. Frugal is the cornerstone and capstone of a millionaire lifestyle.
This post is the third of our millionaires series. Read the other articles listed below to see if you are living by the same values young millionaires commit to.
- What Your Car Status Says About Your Bankroll
- How to be Rich
- The Truth From A Millionaire Gallery
- The Frugal Faithful (current post)
- 10 Bad Habits Of The Poor
What Frugal Is And Isn’t
Celebrities and athletes are notorious for misrepresenting the millionaire lifestyle and not being worth as much as they should be.
Most NFL players are bankrupt 5-7 years after leaving. Is anyone surprised? Their lavish lifestyles are the complete opposite of the millionaire next door.
According to The Millionaire Next Door’s wealth equation a $5,000,000 ball player at 30 years of age should be worth $15,000,000 or more.
The average millionaire is frugal, very frugal. In nearly all cases they have always been frugal and they learned it from their parents. Then they married someone who was even more frugal than them.
In a Millionaire Next Door survey nearly all millionaires answered, “yes” to these three questions. Can you?
- Were your parents frugal?
- Are you frugal?
- Is your spouse more frugal than you are?
Frugal Clothing Shopper
One of the last places people expect millionaires to be frugal is when shopping for clothing and accessories.
With huge names brands and designers it would be easy to spend six figures on ones wardrobe.
By the way, clothing is one the highest marked up items money can buy. It pays dividends to be frugal in this area of your life. Here are some numbers from The Millionaire Next Door to prove it.
The typical American millionaire never spent more than $399 for a suit for themselves or anyone else. They also paid about $140 for a pair of shoes and $235 on a wriest watch.
Why Would Millionaires Need To Budget?
The answer is always the same. They became millionaires by budgeting and controlling their expenses, and they maintain their affluent status the same way.
Have you ever noticed those at the gym that are already slim and toned? It appears that they don’t necessarily need to be at the gym working out but that’s why they are in shape. They have good workout habits and although they could skip several days and still look skinny, hard work and focused determination is what got them there and will keep them there.
To be financially fit you need to execute the basics like developing a frugal mindset. Do you wish to be wealthy and stay wealthy? Can you answer, “yes” to the following four questions?
Can You Answer “Yes,” To These Four Questions?
- Does your household operate on an annual budget?
- Do you know how much your family spends each year for food, clothing, and shelter?
- Do you have a clearly defined set of daily, weekly, monthly, annual, and lifetime goals?
- Do you spend a lot of time planning your financial future?
If you can’t answer yes to these questions then what is holding you back? Make it you goal this weekend to answer these questions.
Answering all of these questions should only take you a couple hours. The easiest way to see your annual spending is to sign up for a free Mint account. Once you sign up and add your bank account and/or credit card accounts then you’ll be able to click on the TRENDS tab and see all you spending on a beautiful pie chart. You’ll be surprised where all your money goes in any given month (guaranteed).
If you want some more help writing good goals then you can get my free 5 Step Goals ebook here.
How can you be frugal this week and create some new lifestyle habits?
Looking for some frugal weekend entertainment? Check out our readers ideas.
Photo from Francoiskarm on Flickr
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