As you know I enjoy studying the habits of financially successful people. This allows me to learn from their mistakes and introduce changes into my own life. I read an article about Carlos Slim Helu, one of the richest men in the world with an estimated net worth of $US67 billion. He lives in a modest house he has owned for 30 years and his bedroom is the size of a hotel room. We also know that Warren Buffett has lived in the same 5 bedroom house for 55 years.
These billionaires know one simple fact and live by it: every dollar you don’t spend on something foolish is a dollar you can instead spend on something worthwhile.
What’s something foolish? A food item at the store you don’t really need. A bigger house than you need, which drains property taxes and maintenance and utilities from your pocket. An entertainment item you don’t have time for. The list goes on and on.
Why do two of the richest men in the world live in rather small houses? They recognize that they don’t need more. They have enough. Recognizing that they have a big enough house means that more cash remains in their pocket.
If you don’t need something, spending that penny on it means you have one penny less to put to work elsewhere.
It doesn’t matter how rich you are or how poor you are. Every time you make a conscious choice to spend less in a way that doesn’t remove genuine value from your life, you have more money for other things. You can save for retirement. You can build up an emergency fund. You can start investing in your first investment property.
Knowing how much is Enough and spending on items of value only will make a dramatic difference to your financial freedom.