All these costs add up - maybe save $100 on drinks, $50 on shoes, $200 on tax break for some weird thing, $30 on gym, $50 on cable, etc. If you are cheap ass on everything, you can save a lot of money. Don’t think of those things in isolation. They are just small parts of the philosophy of not spending money if you can. Part of it is also philosophical. For instance, I absolutely hate paying money in taxes. If I can save 1% of my income by avoiding taxes, that is a greater victory for me than the money itself.
Nana - on this forum, spending money on things like drinks or smartphones is considered stupid, but OTOH it’s required that you spend lots and lots of money on cars, clothes, and watches, because that shows you have good taste.
That, and most on here arent making 250k
I would agree if someone is making 5 figures, not a quarter of a million.
But there’s more stuff too. Maybe save $800 a month by not driving Porsche 911, save $700 by not buying a more expensive house, save $10k a year by not going on Europe vacation, and so on so forth. Once you convince yourself that you don’t want to spend money, all this goes into the system, in addition to all the little things. You spend money on thousands of things. It’s hard to pick and choose what to save money on, so people just save money on all things.
^ People are funny about money, I know for sure that I am. There’s a dude at work, he makes probably close to 6 figures. But he drives the oldest car around. He has a ~15 year old domestic car with busted AC, and we live in Texas! All because he doesn’t want to spend money on a new car, and by “new”, I mean a moderately used Asian sedan. Another guy makes ~60% what guy A does and drives a new 3 Series.
People who save to the point where they don’t even have cable usually don’t make much dough.
I can’t imagine going to Jamie Dimon’s house only to be told that we have to hit the local bar to watch the game because he doesn’t have ESPN.
I see people making 6 figures and more driving old cars all the time. I believe Warren Buffett and Bill Gates are prime examples. I know no one that makes at least 6 figures that doesn’t have cable or sometype of satellite dish, even those that have no time at all to watch TV.
I feel a perfect AF poll in the making… I don’t have cable, but I also don’t make in the 6 figures, so I can’t disprove the hypothesis. I could afford it I just don’t see the point… if you get the more basic packages don’t really get the channels you want. When I did have cable it was only because it was included in the apartment rent and I used it most for background noise when I was on my computer, so now I just use netflix as background noise.
I think one’s willingness to spend may not necessarily be a direct function of their salary. There are many aspiring investors here on AnalystForum, right? I’m thinking a big portion of those are value investing. Personally, I’ve always believed that value investing isn’t just a career; it’s a way of life. Therefore, to understand why people here may be so disinclined to pay for drinks at a New York bar, cable, etc. is probably a reflection more on how they view life rather than what they make.
I see it all the time. Some past managers of mine, who make many multiples of what I do, are still always hunting for “good deals,” whether it’s in the stock market, things for the office, or items in their personal lives. Fortunately, they’ve been reasonably fair about sharing the wealth with their employees, but I see them as “token savers” in many other respects.
I think it was Warren Buffett, among others, that said the key to getting rich isn’t about what you make but rather what you save.
I agree that it is a mentality or even a way of life. For instance, my friend is working on a science project funded by Bill Gates, and it’s pretty cool - he actually meets Bill Gates in person to discuss funding. Apparently, Bill Gates will argue for like two hours over $150k or other sums of money that are basically immaterial to him. Bill Gates is just a very shrewd business person and values maximum return on his investments. I bet he is a (relative) cheapass too, when it comes to spending his own money.
I didn’t have cable until the gf moved in. She wants cable and we both work from home pretty frequently so I set up an office with a landline (dropped calls with clients are not cool) and got a “triple play” package for phone, internet and cable. Then again, where I live it is only cold for a couple months a year so walking half a block to the neighborhood bar if I really want to watch a game is not a big deal.
You can definitely tell I’m a value investor from my car. The reason many investors like saving is simple: where else can you get 100% return with absolute certainty?
I don’t mind spending on good food or vacations, at least for now. I think my vacations will become much more low key and less exotic over the next five years or so.
That’s how I view saving… It’s easier to save money then it is to make more.
I went without cable for a year and can attribute reading numerous books because of it. If i didnt have a roommate now who needs it, i probably would go without cable again.
We should also note that spending a lot of money on one specific thing does not mean that the same person cannot value savings on other things. The determining factor in spending is utility per dollar spent, not always absolute savings. The most common high spending category among cheap people is education for the people’s kids, but I can imagine high income people splurging on some pet interest while scrimping on other things.
No he’s really not.
I’m going to be in Vegas in two days. So, my consumption is going to be above normal, which is to say I very well may die.
^ ill be there in 4
I’ll be there in 2 weeks - no drinking till then…
^ the porn convention is next week, ur missing out
I am in tears