What are the 7 expenses you are paying that you should not be. When you save money, you have the opportunity to make money. And the biggest opportunity is to invest in your future and grow your wealth.
Aristotle says “We are what we repeatedly do… therefore excellence is not an act, but a habit.” And while that is true, the opposite is ALSO true. We are NOT what we repeatedly do NOT do. And nowhere is that more true than in the expenses we choose NOT to spend money on that do NOT help us save money and become wealthy. In this video, we’re going to look at seven expenses that, if you avoid them, will help put you on the road to building your financial abundance.
Expensive formal education
The first expense to avoid is expensive formal education. When you look at the success stories of the world’s wealthiest people, you’ll see that formal education played a minor role in their financial success. Amazingly, roughly one third of the world’s rich are college dropouts. Their ambitions go beyond getting a piece of paper, and into a much more appealing vision. I don’t want to discourage anyone from pursuing a university degree, but the truth is that formal education is often just a means to be bound to a desk in the name of your employer. You’ll be confronted by the ugly truth that the piece of paper you spent hundreds of thousands of dollars on was never a ticket to the financial independence you may have hoped for. While college graduates spend nearly twenty years of their careers repaying debts, the rich are often already economically successful long before. Even when it comes to their children’s education, they don’t spend money on expensive private teachers. Instead, they expose their children to more useful skillsets and opportunities for gaining knowledge. In the long term, these contribute the most to their financial abundance.
TV entertainment and video games
TV entertainment and video games are the second expenses to avoid. According to billionaire experts, a major thing affluent people don’t waste their money on are media entertainment and video games. The general rule is to spend no more than sixty minutes a day in front of the television screen, as opposed to the average of five to seven hours per day most of us do. Many studies have found that there is a high association between household total wealth and the TV consumption rate. Richer households, those with a net worth of seventy-five thousand dollars, recorded a significantly lower TV time duration, and thus more time being productive. Most people choose to pursue meaningful endeavors such as reading powerful novels or focusing on their businesses rather than watching television programs. Excessive video games and TV consumption will only waste your energy and money. Besides, how do you expect to succeed financially when all you do is zone out on your couch?
Avoid expensive cars and costly travel
You might be shocked by the third expense. Avoid expensive cars and costly travel. You may have assumed that, aside from traveling business or first class, all rich individuals drive the most luxurious cars. Well, most of them don’t. They are often spotted driving basic cars, no different than what the rest of us drive. When asked why he preferred to drive a standard Acura TSX that costs roughly thirty thousand dollars, Mark Zuckerberg’s response was that it is a secure, comfortable, and practical car. If you ask me, this is an incredibly rational and truthful perspective when it comes to automobile ownership. Most individuals only see the aesthetic worth of car ownership, unaware of how much it will cost them in the long run. Owning a fancy car comes at a high maintenance expense, increased anxiety levels, and societal expectations. Why would you spend more than ten percent of your earnings on a car that depreciates? According to research done by Experian Automotive, sixty percent of billionaires drive Fords, Toyotas, and Hondas. You shouldn’t be astonished to see a millionaire driving a cheap or maybe even an old car, unlike most people who cave to societal pressure.
Avoid fast food
The fourth expense on the list to avoid is fast food. Another typical expense that the wealthy avoid is the constant overconsumption of fast food. Whereas the average person can’t seem to avoid eating it almost every day. Those who are rich like to eat in more affordable ways. You’d imagine a millionaire would walk into a restaurant and order lunch for everyone or rent out the whole place. Even the wealthy utilize discount coupons to save money and they will make a fuss if a restaurant overcharges them. They prefer buying groceries as a better option than eating prepared foods at a restaurant. Rich people also have a tendency to connect themselves with a healthy and balanced way of living.
Avoid purchasing luxury products
Number five, avoid purchasing luxury products. The fifth expense that most millionaires and billionaires avoid is acquiring luxury products, such as extravagant dress codes and fashion fads that would drown the average employee in a mountain of debt. Yes, we need clothes, but does that mean we need to spend a significant portion of our income on high-end designer labels every month? The fact is that wearing trend-setting branded sneakers that will most probably tear in a few months does not necessarily impress the rich. If you don’t believe me, consider Steve Jobs’ renowned dress code. Most people can’t grasp why Apple’s founder wore basic trousers, a black turtleneck, and the same footwear for years while owning the most successful computer company in history. Rich people recognize that value always outweighs a price tag, which is why they are incredibly frugal with their spending. This is also the reason billionaire Bill Gates keeps wearing a ten-dollar Casio watch to public events, and Michael Bloomberg has worn the same pair of loafers for a decade. And they aren’t the only ones. Billionaires can own the most basic items because the more money you make, the more you realize the value of the things you own. Why would you spend money on shoes every month when a single pair lasts over a year? Also, if you worked really hard to earn your money, why would you put forth all that effort, only to waste it away. In number six, avoid debt installments.
Avoid are debt installments
The sixth expense that all wealthy people avoid are debt installments. This includes any additional costs related to repayment plans. I am not implying that debt is your largest financial adversary. Rather, debt is a tool that the rich frequently use to become wealthier. While this is true, not all debt is the same. While Elon Musk is sitting comfortably with millions of dollars in debt, other people are being devastated by college debt and expensive mortgages. Rich people rarely use excessive numbers of credit cards, vehicle loans, and bank loans. That is, unless the investment they are purchasing can boost their overall income. Without a strong financial plan, debt payment is an expense that might severely damage your financial life and potentially obstruct your path to financial success. Because, like many forms of trouble, debt is very simple to get into but complicated to get out of. Let’s consider the case of Chad, a college graduate. How long does it take an average graduate to return a twenty-six thousand nine hundred dollar student loan? According to the Department of Education, this can take up to twenty years, which is roughly five times the length he spent in college. This debt will almost certainly have acquired a lot of interest over the years. He will be repaying far more than he originally borrowed. This is why affluent people avoid debt whenever possible and, if they must, they ensure that they will have a clearly defined financing technique. In fact, When it comes to debts, Warren Buffett said, “If you’re smart, you’ll make a profit.”
Costly real estate
The last expense to avoid is costly real estate. This may shock you, but another expense that wealthy individuals avoid is having numerous, pricey, and elegant residences. This statement contradicts the extravagant properties that celebrities flash on social media, but in reality, the rich are exceedingly cautious when it comes to home ownership. Even though they live in extravagant mansions, you will find that these houses weren’t acquired at current values, and even if they were, the values don’t come close to that individual’s net worth because, let’s face it, buying an expensive house in an elite neighborhood is a destructive approach to wealth generation. This is why you’ll find that the number of millionaires living in houses valued at three hundred thousand dollars or more is relatively low. If you’re financially aware, you’re already familiar with the fact that by living in a million-dollar house or neighborhood, you are opting for an expensive lifestyle that may jeopardize wealth generation. To get one’s money’s worth and ensure that the property increases in value through time, wealthy individuals always seek out the best deals on property purchases through carefully planned investment moves. They will buy a house for a low price in a desirable neighborhood, then wait for its value to increase over time, so they can flip it for a large profit. It’s no surprise that Warren Buffett has lived in the same property since 1958, and it has virtually tripled in value. This is contrary to those who take enormous risks with their money.