Comments on: How much money can you amass living frugally?

By: Sandra

Sandra — Wed, 14 Dec 2011 17:10:41 +0000

Doesn’t matter how she did it. Main point is, she did it, and left it to help others.

That is a fabulous thing to do.

By: Sandra

Sandra — Sun, 20 Jun 2010 16:38:20 +0000

It totally amazes me how people think they have a right to dictate how people should live, and also to get into their business. Point : If the lady wanted to be a “miser”, she had that right.

That having been said, I do not think the lady was that miserly. If she wanted something, she went ahead and got it or did it. The grand piano is an example. Her European and domestic travel is the other.

By: A cruel financial joke?- 7million7years

A cruel financial joke?- 7million7years — Fri, 19 Jun 2009 15:41:58 +0000

[...] Rick puts it simply: Saving half your income is far easier if you make $180,000/year than if you are making $61,000/year. [...]

By: Kristy @ Master Your Card

Kristy @ Master Your Card — Fri, 05 Jun 2009 02:35:57 +0000

I could afford to be more frugal, for sure, but I don’t think I’d want to live quite as frugally as she did. I would have replaced the TV, updated the furniture, and got my hair done. I might even have gotten the car I really, really wanted if I were in her shoes. But, I don’t necessarily want to be single and not have a family for the rest of my life. I want a husband and a child (yes single, only one for me) so I don’t think a lot of what she did would be feasible in my situation. I certainly applaud her efforts and I’m glad that she didn’t go without the things she truly wanted, but if I had amassed that much money I would have likely enjoyed more of it.

By: Adrian

Adrian — Wed, 03 Jun 2009 02:37:27 +0000

@ KC – I was agreeing with you … I guess it came out badly when it came to actually keyboarding it

By: KC

KC — Tue, 02 Jun 2009 23:37:11 +0000

@Adrian. Sorry for being so thick, but if paying yourself first is so obvious, then what did you mean by:

“@ Rick – while I agree with you, there is a cruel financial joke; it goes something like this:

- earn $50k, spend $50k?
- earn $150k, spend $150k!”

Weren’t you saying that everyone inevitably lives to the level of their current income, without recognising the importance of “paying yourself first” ?

Surely “earn $150k, spend $150k” is the very anti-thesis of pay yourself first, and therefore needed remarking upon?

By: Adrian

Adrian — Tue, 02 Jun 2009 21:44:37 +0000

@ KC – Yes, I believe that the point of the original article is to illustrate how much you can amass by ‘paying yourself first’ (in this case, we assumed 50% of all income) and tithed (presumably, considerably more than the ‘standard’ 10%).

By: KC

KC — Tue, 02 Jun 2009 12:50:02 +0000

@Adrian (re: Rick and Scott). I once heard a finance writer saying the key rule to overcome this sort of problem is:

Pay yourself first.

Sadly I can’t remember the precise details he gave, but essentially he compared a guy with a family living in a smaller home with a lower salary; to a guy who just had a wife but had a big house and a higher salary.

But the first guy always “paid himself first” and came out on top after, say, ten years.

The first guy always took 10% of all income into the household and “salted it away” and he never broke this rule. He acted like the family had never received that money, and was unavailable to pay bills.

The second guy had never heard of this idea, and deep in his psyche believed that all money coming in was available to be spent.

The first guy ended up much richer overall, even though technically he was poorer and had more mouths to feed. So people with less income can end up richer, which is quite a profound observation.

By: Adrian

Adrian — Tue, 02 Jun 2009 00:27:11 +0000

@ Rick – while I agree with you, there is a cruel financial joke; it goes something like this:

- earn $50k, spend $50k?
- earn $150k, spend $150k!

The habits are made when you ARE earning $61k per year … at least, in my (and, Scott’s) experience.

@ Scott – “Even if we brought home a third of what we do now, we would simply have a smaller mortgage, lower taxes, lower resulting insurance and lower costs in several other areas and we would be saving a large percentage of our salaries as well. This is were delayed gratification comes into play”

Exactly

By: Siddharth Rao

Siddharth Rao — Mon, 01 Jun 2009 20:18:49 +0000

Great article and a very close (and precise) calculation! In my opinion – it isn’t that hard to make a million dollars over a span of 30-40 years, especially if you’re living a ‘frugal’ life. As a matter of fact – you don’t have to live that kind of a life to make a million dollars. All you need is some consistent and disciplined saving habit till your retirement and let the money compound over time. However, the question is – how good will that be after 30 years? Inflation plays a big role. A person who had a million dollars in 1972 would need 3.5 million dollars today (in 2009) – if s/he wants to maintain the same standard of living/lifestyle as they did back then. Worth a thought?