Frugality Can Make You Rich

Frugality is a mind-set; it can be learned by consciously being aware of your money and where it goes. It doesnt mean depriving yourself. It means being smart about money, getting the most out of your dollars, and saving or investing the rest.

It seems like majority of immigrants came to the land of opportunity with a single goal; that is to amass the largest amount of wealth in the shortest time possible. As you all know, most of these immigrants dont speak English very well, and work near minimum wage types of jobs yet they have more money than their neighbors with higher paying jobs.

Some immigrants have $100,000-1 million dollars net worth with a low annual income. Why is that? Well, they are frugal and believe that it is wrong to waste money. How many people think like that?

Most of us will buy things we want at the spur of the moment and when its no longer fashionable or if its not a fun toy any more we toss it. If its food we bought that doesnt suit our taste, its thrown out and we head out to buy another meal. Or we buy several bags of candy at the checkout line that we hardy eat and magazines that we read only an article or two out of.

Who do you know that is close to you that has a budget and sticks to it?

How many people do you know that consistently save and invest a certain amount of money every month, regardless of how high the bills are stack up?

There is a gentleman that I know and admire very much; he works hard as a housekeeper and supports a wife and two kids with only a salary of $14 an hour. His wife is a housewife and has no income. Yet hes able to amass $100,000 in 10 years. How did he do it? Thats what everyone wants to know. He had to make sacrifices to work hard and save that money but he doesnt consider it depriving his family or himself.

Here are some of his secrets to saving more money even if you have very little.

He recommends starting with $25-50 a month if you dont have a lot of money. Try to save and invest 10% of your income if possible or more. If you consistently save the same amount of money every month and put it in a safe investment where your money can compound then youll see that small amount of money grow and grow. Never touch this money, no matter how bad the bills get or how you feel you need it. Youll be worse off later if you didnt have these savings, so resist the urge to spend it.

Cut coupons for groceries, sign up for the grocery discount card and use it. Use credit cards that have cash back or rebates. Negotiate when youre buying things at small merchants shops.

If you go to flea markets or swap meets, never ever pay the full price that they quote you, you should always offer to pay half. Some of them will give it to you at 75% of what they originally asked for. Some will say no. Others will give it to you at half price because you asked. Always ask for discounts on bulk order, or if youre buying 2 or more items.

If you live near the harbor or coast, and want fresh fish or seafood, find out what time the boats dock and get to know the people that work on the boats. Then buy it directly from them when they carry the fish or seafood down the boats. They sell it to the supermarkets and grocery stores an hour or two later so you might as well skip the middleman. Try this technique with smaller boats it works better.

Be friendly to shop owners, bakery owners, fishermen, farmers and restaurant owners because theyll give you discounts and freebies for being a friend and a frequent customer. Dont take advantage of them and dont expect it.

The gentlemen I mentioned above has gotten free fish from fishermen, pineapple from farmers, mushrooms from farmers, and 30-40% discounts at local shops that he frequents.

Take advantage of every company fringe benefit. For instance, my friend works at this company that gives one free bus pass per month to employees and he sells the monthly bus pass he gets for $40-50 since he has a car. Its extra money.

Max out your employer matching 401k as much as possible, up to the limit where they will match you dollar for dollar or 50% of your contribution. Its much better than any investment you can make because its an instant 50-100% return guaranteed without doing anything on your part.

Wait for sales before running out and getting something you want. Budget for the items; dont charge it on your credit card if you dont have the cash. Dont spurge for no reason or just to feel good. Dont try to keep up with the girls at work or the Jones, it doesnt matter what they have that you want, keep in mind that youre trying to amass wealth.

Its worth the small sacrifices knowing that you have the security and financial freedom that comes with having lots of money in the bank.