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Frugal Habits of the Super Rich
Just because someone has a bank account that rivals that of Warren Buffet doesn’t mean they spend without any thought or care. In fact, research shows that wealthy people are surprisingly frugal.
That doesn’t mean they’re cheap. After all, there is a big difference between being cheap and frugal. Frugal means that you are smarter at prioritizing your funds, finding great deals and making strong investments, traits that have made rich people richer for many years. They have wealth because they realize the true value of money.
Here are some of the frugal habits of the wealthy that will help you build up your own bank account.
- They live below their means.
The rich are known for living well below their means. For instance, they don’t see a car as a status symbol; it’s just a means to get you around where you need to go.
Sam Walton, the founder of Wal-Mart, drove a 1979 Ford F150 pickup truck. His son, Jim drove an older Dodge Dakota even though he’s worth over $16 billion. Mark Zuckerberg of Facebook owns a $30,000 Acura TSX basic sedan.
Many wealthy people live in modest homes as well. Warren Buffett still lives in the house he bought for $31,500 in Omaha, Nebraska in 1958.
Ikea founder Ingvar Kamprad and former Microsoft CEO Steve Ballmer choose to fly commercial, and even coach.
They don’t spend money on expensive clothing either. In fact, 74 percent of the wealthy shop at Wal-Mart, while only 6 percent shop at Brooks Brothers.
- They use coupons.
It may surprise you to know that households with an average income of $100,000 or more use more coupons than those that make less than $35,000. Celebrities including Carrie Underwood, Lady Gaga and Kristen Bell are just a few who are fans of coupons.
In fact, 71 percent of the rich use paper coupons every month and 54 percent use online coupons monthly.
- They appreciate quality over quantity.
Wealthy people aren’t cheap, but they do put more thought into their purchases. They are willing to spend their money on something of quality that will last over the years instead of an inexpensive purchase that will need to be replaced again and again.
- They don’t carry large amounts of cash.
Take the advice of oil mogul T. Boone Pickens and carry only the cash that you need for what you intend to purchase. The rich tend to avoid credit debt, and are more concerned about having enough money and managing it well.
- They are charitable.
An interesting habit that the rich tend to have in common is their willingness to donate a large amount of their wealth to charitable causes. Zappos’ founder, Tony Hsieh personally invested $350 million in the Downtown Project to improve downtown Las Vegas. Other wealthy individuals including Bill Gates, Warren Buffett, Mark Zuckerberg, and Michael Bloomberg have donated huge chunks of their fortunes to help the needy.