I’m not a particularly frugal person. But I also don’t spend in bizarrely inefficient ways like most people do.
Most of the people I know finance new vehicles, live in the biggest house they can “afford”, and seem to be in a different city every weekend on a little mini-vacation.
It’d be one thing if most of these people were well off or at least doing really well financially… but most of these people are barely able to make it paycheck to paycheck and they’re still just burning through cash.
I didn’t buy a new vehicle until my net worth was over 7 figures. I lived in a tiny, tiny apartment for several years longer than I needed. For years, I spent most of my weekends on fun side-hustle projects – not quite a day job, but still financially productive.
This doesn’t mean I had any huge sacrifices. My life was still great. I just wasn’t putting my life savings into a pile and then burning it for a slightly more convenient lifestyle – unlike most people.
Right now, my life is a mixture of extremely comfortable and fairly modest:
- I live in a modest home in a small town in a working class neighborhood. But I’ve fixed it up quite a bit. I’ve added a large office, a smoking room, etc.
- I try to only go on trips that are day trips – as in, I can drive there and back in a day – or are covered by my credit card rewards points. Because I’ve hacked my credit card situation fairly well, this allows me to travel quite a bit now.
- Because I live in a modest house, no mortgage payment.
- Because I delayed buying a new car until I could with cash, no car payment.
- Because I dropped out of college to work on my business, no student loan payments.
- Because I never finance anything with credit cards, no credit card interest payment.
The good decisions over the last 10 years that I’ve made now allow me to spend quite a bit of money on things that I actually care about that really do move the needle on my material lifestyle.
For example, I recently “got into” making cocktails. Spending $400-500 on different equipment, mixes, and drinks to experiment for a few months is no big deal at all. It’s a fairly cheap hobby. I only drink the “good stuff” when it comes to alcohol, and it’s still extremely affordable in the context of the other good decisions I’ve made.
I started traveling this year more than ever before. I rarely traveled until recently, but now that I can essentially travel for “free” because of the rewards points, I’ve used that to force myself to start taking substantial quarterly trips. My most recent trip as of writing this page was my 2 week stay in Northern Italy.
I added a smoking room to my house and I enjoy an occasional cigar and cocktail. I don’t smoke a lot, but when I do, I want it to count. I don’t worry about spending $20+ on a cigar if it’s an enjoyable one. Because I don’t have to worry about all kinds of other payments, I’m able to enjoy little luxuries like this while still saving more money than most people.
In the end, what I’m describing above will never become mainstream or popular. Very few people will ever have the self control to not immediately upgrade their home when they get a raise or buy a new weird-looking car the moment they can get approved for the credit.
But that’s ok for people like us. The world doesn’t have to make sense for us to enjoy the benefits of good decisions being made consistently over time.
Financial success is more likely for those who are patient.