This chapter is from the book
This chapter is from the book
This chapter is from the book
The Truth About Getting Rich
The basic premise of wealth must be understood. It doesn't matter whether you earn $20,000 a year or $200,000. The only thing that makes you wealthier is regularly spending less money than you make.
That was proven in The Millionaire Next Door, a tremendous best-selling book that shattered myths about who America's millionaires really are. In fact, millionaires are not highly educated people who inherit a lot of money and spend it on obscene luxuries and pampered lifestyles.
Instead, they are hard-working people who, among other common attributes, care about what things cost and about getting good value for their money. In short, America's real millionaires—not those who just look the part—care about their spending. And you should too.
I like to think The Millionaire Next Door proved the philosophy, and this book provides the details.
Spending Smart is not about freeing up a few bucks here and there, but literally thousands of dollars, which compounded over a lifetime is the difference between struggling and being rich.
If getting rich isn't your goal, you still need to spend money smarter because money gives you options. You have options to quit a job and pursue a lifelong dream, options to give money to charitable causes that inspire you, and, in general, options to pursue what makes you happy.
Spending money smarter will help your relationships and maybe even your sex life. Without the desperation and fear that comes with money problems, all the relationships in your life can be more enjoyable.
You need to control spending to build wealth. It's the only way—outside an inheritance, lottery win, or some other windfall—you'll ever accumulate enough money to make it work for you. That means getting money to start making its own money. For most people working normal jobs, there are not enough hours in a day to build wealth simply from working for a wage or salary. Instead, you should spend less and invest your money, whether in stocks, mutual funds, investment properties, your own business, whatever. All that matters is your money is making money while you sleep.
For most people, it's the only way to get rich.