the key to wealth: stop acting rich

I recently heard on national news show - The number one car of millionaires - Ford. Number one reason - because you get your moneys worth in the long run. Just so you know I do not own one.

we have been out of debt for many years and have NO credit cards..sometimes you do wonder when the next shoe might fall..like the frig quit or something..but it is a better way to live.

We also live in a small house..and grow a lot of our own food, drive older vehicles..etc.

I had emergency hernia surgery (lifted too large a chunk of firewood) last year and have a medical bill that I'm making payments on, but it is a monthly interest free payment just like your phone bill or whatever..so I don't consider it debt, it is getting paid off quite quickly..and then we'll be free of it.

I do think a lot more seriously now before making a purchase..sometimes I dont' do so well and buy some things I shouldn't..but with less money available for purchases and no credit cards I'm not likely to buy something I really don't need so often.

I tend to avoid nick nacks but have a lot of things that were given to me I haven't parted with..although some i find ridiculous and someday will manage to give to a charity...but gifts are difficult for me to regift or give to charities ..as I feel the person that gave it to me will want to see me using it.

@ Nancy.

The Canadian populace may not have worries about Health Care Costs but we can have ridiculous food costs in fall and winter.

My friend lived in the north and worked as a nurse. She had to be paid $150,000 per year because of the high cost of living in Nunavut (our Northern most territory.) Milk is ,like, double what it would cost in the south. Most Cnadians live in the southern-most part of our country. Most of us live within 2 or 3 hours drive to the US border.

The climate and growing season sucks for food production for our 34 million people.

What I hate to see is peope who want pineapples, avacadoes,flowers, fresh lettuce, etc in the winter. Dang! The cost is crazy and is it sustainable?? If you were to shop here you'd see that in the fall/winter our produce comes from Mexico, California, Chile, Israel....

We are ALL living like we are rich. And the earth is poorer for it.

FYI.

Stop eating like your rich!

I used to love to eat Orange Roughie 'til I learned where it came from (Australia) and that it was endangered.
http://en.wikipedia.org/wiki/Orange_roughy

We can't keep eating like there's no danger to fisheries.

My 2 cents for the day.

Peony Jay, you have some good points. For example, do you all want to know how much pineapples cost here? 65 cents roughly for one that was allowed to ripen in the field. In fact, because they are shipped green up north, the pineapples here are incredibly rich, and the first fruits aren't shipped, because they are early, they are sold locally, usually by the side of the road.

But I grow my own, easiest thing in the world honestly. Whack off the top of a pineapple and put it in full sun on top of fertile sun. Ignore for around a year. Enjoy.

Unfortunately, commercially raised pineapples are incredibly bad for the environment, it is called the green desert here.

Oh, to follow up, by buying local, you reduce costs. Harder to do in the North for sure, because many fresh foods aren't available during the winter. Here it is easy. I just got a book on cheese making, cultures and three goats, not because I wanted more work, but because I wanted better cheese.

Peony Jay, I agree in spirit. However, I think fisheries, because of the enormous industry, the billions of dollars spent for decades to ever more fully exploit and ever-depleting resource, are sunk, those that fish for human food as those that fish for wild fish to grind up for fish food to drive western aquaculture. The focus should be on trying to curtail the sterilisation of the oceans by that industry. What good is having money if the oceans are empty?

@ Fred.
I have heard of the term "green desert." Yes, we should try to grow as much as possible, support local growers/farmers and do canning or just get by with less green stuff/fresh stuff in the winter.

I have to admit that I'm not going to eat only homegrown potatoes, kale, carrots, turnips... all winter long. I'm good but I'm not a bloody saint!

wayne stephen wrote:I recently heard on national news show - The number one car of millionaires - Ford.

I often refer to my 12 year old Taurus as my "status symbol" -- take that for what you will

I'm waiting for the "buy nothing" day to become a "buy nothing that doesn't biodegrade" day.

I think there should be an ethic of not buying stuff just because it's popular, it's new, it's the new version (2.0), your kids will think your cooler by owning it, you'll be hip, etc.

Why are we such lemmings?

Years ago I lived in Japan and honestly one of the first words I learned was "shinhatsubai." I heard it everywhere! It means "brand new on sale" or "brand new product." This feeding frenzy of buying things just because they were new caused a lifelong disdain for "new."
The Japanese also had 'Dai Gomi" days- that's garbage days for larger things. There was no market for a slightly used camera, or fridge, or computer or even furniture. It was all just thrown away on Dai Gomi days. This made me a "Gomi Shopper"- I picked up great stuff out of the garbage piles every 2 weeks!

Peony Jay wrote:@ Fred.
I have heard of the term "green desert." Yes, we should try to grow as much as possible, support local growers/farmers and do canning or just get by with less green stuff/fresh stuff in the winter.

I have to admit that I'm not going to eat only homegrown potatoes, kale, carrots, turnips... all winter long. I'm good but I'm not a bloody saint!

Neither am I. We buy apples here when they are good. They sure don't grow here, at least any that are worth eating. But most of what we eat is locally grown, and we grow a lot of it. Mainly because I like my food very fresh, but then again, we have year - round growing conditions.

Large scale agriculture in the tropics tend to be very dependent on chemicals. One, organics break down in the soil twice as fast as up there, and the growing season is 365, not 120, so you figure you are always feeding the soil with organic material. Thankfully, I have lots of organic material from the plantations of trees.

I just found this site and I love it! I have gained so much great info in such a short time I'm a little overwhelmed. I completely agree with changing our buying habits by changing the way we look at "stuff". My wife and I were foreclosed on 5 years ago when the housing market fell of a cliff and it seriously changed our outlook of finances. We have since worked very hard at getting out of debt and doing some real downsizing. We lessened our car note and in the next two years plan on being rid of it for good. We became renters while we built our credit back up with the plans of buying a much smaller home. We now have ZERO credit cards (they are the devil!), no satellite or cable, no internet at home, or anything else we decided was useless. The real kicker to our story is that we lost a $180K 1600sq.ft. home only to walk into a $58K 2300sq.ft. home!! I mean honestly, that's just crazy. We love our new(old) home. It was built in the 50's with plaster walls and ceilings all oak floors and a beautiful fireplace. We feel that our house and our new lifestyle are a true blessing.

I know I'm not telling anyone here anything they probably dont already know but the great thing about leaving all that behind to move to the country is that we realized we really don't even miss any of that other stuff. We are so busy spending time as a family teaching our two girls how to plant gardens and take care of chickens that we wouldn't have time for that stuff even if we did want it back.

Denise Lehtinen wrote:

Mt. goat wrote:Isnt the frugality movement just propoganda from the 1%.?

Nope. In fact the mantra of the 1% is "Greed is good". (And it is what they live themselves.)

It is also their favorite tool for controlling the 99%.

Yes!! The way to control and keep the poorest in society "in their place" is to make them want what the rich have. The idea of "spend, spend, spend" is there to keep consumption, and therefore capitalism boldly striding forward, which in turn lines the pockets of the director's and shareholders, while the people who have been brainwashed since childhood into becoming the indentured wage slaves needed to keep them there are stuck in unfulfilling jobs scraping by to put food in their mouths and clothes on the table. Keep people busy, and exhausted just trying to survive, and they don't have the time or energy to rock the boat...

Trying to avoid politics .... so I wish to express a position and I suspect that I am most likely the only person here with this position: I think going after the 1% is a red herring. I think there could be people in the 1% that are really awesome people that got into the 1% through hard work and awesomeness.

Having said that, I think there are also a lot of folks in the 1% that got there through something icky and possibly even illegal.

So I choose to not direct the stink eye at the richest 1%, but to direct the stink eye at icky people - especially the people in the 1% that got there by doing something wicked.

As for the topic at hand (stop acting rich): I think the point is to stop trying to keep up with the joneses. My impression is that once you let that go, your expenses seem to get cut in half overnight. Seems mighty smart to me.

Love this topic!
I let my debts get out of hand about 18 years back and it taught me a lesson. In fact that lesson was driven home every month as I paid it off (over about 2 years). Since then I've been cautious about debt. It's like a power tool, very useful but one wrong move and you could be harmed so badly that it could take years to recover. With that in mind, when I got tired throwing my money away on rent, I decided to buy an affordable condo rather than bankrupting myself on a house. I wanted something I could payoff quickly, rather than taking on a load of debt that I would struggle to keep current, for decades. The mortgage was only a bit above my yearly income so I was able to pay extra every month and still have a lot of extra money. Then once I paid it off (in late 2010) I found that my usual spending (on everything) totaled only about 30% of my monthly take home pay. I saved for a year or so and then saw an awesome house on a half acre, only 16 miles from work. It already has fruit trees and it's just made to order for a permaculture lifestyle. I'm a city guy, I must admit, but I'd really love a decent sized garden. The patio garden here at the condo just doesn't cut it anymore.
The total house payment (including taxes, insurance, ect) will take 28% of my take home pay, and the mortgage total will be 210% of my yearly income. It's a bit more aggressive than my condo mortgage but not too arduous. As soon as I move in and get settled, I'll polish the condo up and turn it over to a renter. I also plan to rent the two extra bedrooms in the new house (and assign to each room, one room in that huge storage building in the back yard). With the combo of the shed plus a storage locker the size of their bedroom, plus the very modest rent I'll charge, should decrease renter turnover. In fact once someone gets in there they probably won't want to leave till they can buy their own place. And even with the modest rent I'll charge, the rents from the condo and the spare rooms should quite easily cover my entire house payment. My goal is to aggressively knock this mortgage to zero in about 5 years. Then if all goes well I'll be on easy street till I retire.

I don't know if this is the place to mention this but here goes. Part of keeping a frugal lifestyle and a stable financial outlook was to avoid the whole marriage thing. Back in 1997 after yet another friend went through a horrible divorce, I looked at the odds of something like that happening to me and what the most likely outcome would be if it did, and then after agonizing over it for a year or so I decided to skip the whole marriage and family thing. Its too bad because I know I'd have been a great husband and an awesome father but the risks involved in marriage are so severe that I just couldn't justify it.
Somewhere out there is a woman who would have been my wife (if things were just a bit different). I'll wave goodbye to her right now. She'll just have to find her way through life without me. The legal system and the family courts have just made her too dangerous to live with. If I married, I'd be risking my entire financial and emotional future on something with a 50% failure rate. Nope. I just couldn't do it.

just thinking, I don't pay $160 for jeans I pay $18 and my usual shirt is a t shirt for about $6 each. so i guess my idea of thinking frugally is a little different. sure my jeans are probably made in china..i would love to be able to afford $160 jeans made in USA..but I can't, so I don't.

I have a very comfortable life, always have had, but I also know I do not live as frugally as I could..a lot of it I'll blame on my husband who has a head injury and lives on satellite t v and store bought ice cream and cookies ..if he doesn't have them he will get in the car, go 50 miles round trip to get them and I wouldn't be able to stop him..so yeah..there are some things that would be cut out if I lived alone..but I don't.

I do shop for deals, plant my own garden, fruit trees, nut trees, berry bushes, etc..and I do often buy eggs from a neighbor and occasionally get some game (bear thawing for supper)..but I don't do as well as I could.

I think we all probably choose to have those comforts that we choose..and will skimp where we feel we can..but i also think a lot of it has to do with maturity, as we get older we realize how little we really need..and how few people we need to impress.

I do kind off act rich because I feel very rich. eating the right foods, burning as little energy as possible to keep our place warm. Going out everyday and breathing this wonderful air and looking at the trees as they grow and change with the seasons and the debts they didn't come out of wanting to have a great house or the most expensive car. They came out of living in a city where rents where incredibly high, electricity, you have to pay for it but there is no alternative you want to keep your kids warm, it's the only way to do it employ the electricity company. Kids school costs, sports, activities all the things they want and the commerce jumps right on top off - skyrocket and you have to go out and earn even more or borrow or else everybody around you (especially the other parents - suffering the same injustice) have put you down as a bad parent and before you know it you are in debt teaching your kids all the wrong stuff that keeps this crazy society rolling. I've made a change. I teach my children what I think is important....

Most people need to learn how to live within their means so that they will not find themselves drowning in debt. Poor people usually spend all their earnings, rich ones know how to make more money out of what they already have.

That's the smartest thing to do if you live in a place where this is possible.
In Amsterdam the government decides where you can live based on your income and family size and unless you buy a house which is to expensive for most people, you may not live in a smaller house if your family has for instance 3 kids. (which is my situation)
That gives you rent class of around 600 euro which for an average income is very high. adding school costs, books, electricity and heating, it doesn't leave much for food or clothes. Getting into debt if very easy for a lot of families there just by not being able to afford the books or the electricity bill in which case high cost are continually added.........most the people I know that are in debt there, didn't get there by owing anything special just the basic things that in some point of their lives they stopped being able to afford....

The Devil's Dictionary in 1911 defined debt this way - "An ingenious substitute for the chain and whip of the slave-driver."

How does one measure wealth? that is the 1st question that need to be answer.......

Firstly minimize the amount of you spend on depreciating product.
Secondly produce as much of your consumable as possible.
3rd minimize how much input you have to give to the systems that provide for you.
4th dont borrow, pay as you go, all at once or even pre-pay. Have others owe you.
5th live a healthy life, minimize stress, find hobbies, meditate, worship god. Yes its true people who worship god live healthy for longer.
6th Provide for others not so much for yourself. They will pay you, you will also be less stress out about life
7th Plan ahead, while also considering that this day could be your last and that change is constant. Living in ones head is fun.

I'm a little behind the discussion, but just discovered it and have enjoyed reading the comments and the original article. I am in the process of downsizing my storage unit from a 5 by 5 to a 4 by 4, and sorting through all of my belongings in the process. It is remarkable how new thinking and lifestyle changes over the years makes it easier and easier to get rid of things I once held valuable.

For example: I found a box full of shampoo, lotions, perfumes. Not too long ago I decided to jump on the "poo-less" train. None of that has value to me anymore.

Or several boxes of clothes. Who needs more than a couple pairs of pants and a couple t-shirts? Unless, of course, you must look nice for work.

Why own DVD's? Netflix.

Boxes and boxes of books? OK, some books I consider a resource and won't let go of, but with libraries and kindles, why do I need so many books?

I am finding it easier to downsize than I thought.

The troubling thing behind all of this is the engrained "need for things" that marketing has imposed on us all. We are told we need to shampoo our hair, or shave, or buy bottled water, have a cell phone, computer, car, house, 20 pairs of shoes and full wardrobe. But many of these things we don't actually need.

I am going to continue to reevaluate what it is I think I need (The Lorax!) and hope to decrease spending in that way.

S Bengi wrote:How does one measure wealth? that is the 1st question that need to be answer.......

The terminology is muddied. I like using the following definitions.

Value : "the regard that something is held to deserve; the importance, worth, or usefulness of something." -google
Wealth : is something that creates value. e.g. the means of production. like all the tools in a machine shop that can be used to do and make stuff that people might find more valuable, a farm, etc.
Money : a store of value often times largely valueless in it's own right. The difference between a $100 bill and a $1 bill (besides all the new anti counterfeiting stuff) is almost nothing practically. A paper airplane built out of $1 will fly just about the same as a $100.
Rich : having a lot of money, ( or going through a lot of money )


Take the garden as an analogy. Ripe tomatoes have value. The tomatoes have food value, they can be used as sustenance for things. The wealth is the garden plot, the soil, the nutrients in the soil, maybe some trellising, and probably the skills the gardener have picked up along the way. The value of the tomato stays the same. How much money you can trade someone for that value however changes with market conditions.


In the short term you can get a bunch of money out of a garden buy selling all the production. The long term wealthy families tend to put most of their income back into building their wealth so they'll have more later. Just like permaculture people do with compost into garden beds. After a while they start looking like that green thumb gardener everyone knows that seems to have more food than they know what to do with. The wealthy spending %10 of their net income (discretionary income) on a fancy car looks ostentatious and obnoxious, yet it is a smaller fraction of their net income than you or I tend to spend on toys.


The average american family has something like $4000 / year in discretionary budget items (yah, it's a funny number making lots of assumptions that are wrong but bare with me.). 10% ($400) of that gets you the top of the line game console bundle from some on line store I just looked at. For someone bringing in $1M / year, 10% is that new fancy Tesla super car thing. That flashy car that costs as much as a house is like an game console to them.


If you are rich, then the nice car isn't anything. If you are acting rich and spending your last pennies to get the outward trappings of a rich person... that is the problem. Most of us have been conditioned and suckered into this.


stop acting rich, start acting wealthy and use that third permaculture ethic and return the surplus to the wealth pile.

My definition is pretty simple. If you lost your job today, how many months can you maintain the same standard of living?

I read an excellent version of this a while ago, posed as a question: Who do you work for?

If at the end of the month all of your income has gone (or worse still MORE than your income has gone, so you are in debt) then you don't work for yourself, you are working for a bunch of other people and companies. You work for the company that provides your satellite TV, your local take out pizza firm, your local car garage, your bank, etc...

To be wealthy your need to work for yourself, meaning that at the end of each and every month some of what you have earned is yours to keep. Emphasis is on keep - not spend!

It is a very simple idea, but when you really get to grips with it it can set you on a path for life.

There is a good book called The Millionaire Next Door. Two university professors did a study on income and wealth and concluded that those two things are very different. I read it several years ago and it changed my ideas on income, wealth, and "need". It took me several years to figure out how to get to where I didn't need money. That's not do say that I don't WANT money, but it's not about what you make, it's about what you save.

So, my story.... I make a lot of money. A LOT of money. But I've always spent a lot of money. Almost every penny. When I was married I spent everything on my wife and kids. Houses, cars, trips, whatever. Then I got divorced and spent everything on divorce. I left the divorce broker than broke. I started putting life back together by working harder than ever and making more than ever. I was also spending more than ever. About two years ago I was done. It was time to downsize in a big way. The first thing I did was get rid of teh $28,000 suburban that cost almost $1,000 per month to drive. I bought and old Subaru for $4,000 cash. Then I had to get out of the house. I didn't know where or how, but I had to tackle my living expenses. We moved out of the $2,000/month McMansion and into an $850 per month apartment. That still wasn't good enough. I needed to own something, something that cost $0 to live in. I began saving, and knew I had to start with land. I found a piece of land that fit my budget and needs, and bought it cash. Then it's on to a place to live. I knew I couldn't build a McMansion, and didn't want a McMansion, but I needed a place to live. I decided to build a shop with an apartment upstairs. Maybe your answer is a tiny house, or a mobile home, or whatever. I could have gotten by with a 12X16 dry cabin if I had to. And if that's what you have to do then do it! I have my own well, my own septic, and off grid power. If you cant afford a well haul water. If you can
t afford a septic dig an outhouse. If you can't afford a solar setup start small with a generator and add to your solar setup in increments. I heat with wood and coal. The next step is food. Meat rabbits, a garden, a greenhouse. Have you been to the grocery store lately? Good grief! And they say there is no inflation!

The key to this is 1)liberty and 2) hard work. You need to find a place where you are free to do what you want and need to do without constant meddling from government bureaucrats and nosy neighbors. The second one. Hard work. Homesteading isn't easy, but it's worth it. I've found that once I didn't need money I could actually save money. Once I owned my stuff my stuff became wealth and not a burden. Once I was able to live on my own I wasn't a slave to my cubicle.

It's not what you make it's what you save....

Denise Lehtinen wrote:

Mt. goat wrote:Isnt the frugality movement just propoganda from the 1%.?

Nope. In fact the mantra of the 1% is "Greed is good". (And it is what they live themselves.)

It is also their favorite tool for controlling the 99%.

Im in a position where I would love to have a homestead here on the edge of dartmoor. I love it round here. Sadly I would need a million in the bank to buy one cash. At least. I dont need one, but I want one. I would need to earn a lot more than I currently am.

I guess I need to learn how to make my money work for me better as well.

My spouse went suddenly and permanently disabled nearly two decades ago. We were just starting to deal with retirement planning. Boom. Fixed income. It cost more for me to go to work as I couldn't quite land enough of a paying job (seriously I needed one with health and other benefits and paying the equivalent of $30 an hour with the bennies figured in) then we had to move to where cost of living was cheaper.

We've learned how less can be more and making your own instead sometimes. We did invest what we had left in land, so have our in-town ranchette of two acres with three houses and a shop.

Our cars are older and I've had to learn to be the mechanic because my better half can't do it anymore. I am a semi-demi-permie because of the having to make do. I would like to go farther in getting enough food grown to substantially supplement what we buy (and are about 60% of the way there, maybe hitting 85% in 2017).

I sew a lot and dumpster dive for material. (long story, short answer, I can do so). Recycle and repurpose are a way of living. Energy needs, working steadily to decrease those needs as well, saving for the parts for the wind turbine (we are in an area being developed for wind farming) and going LED as economical watt-to-lumen for needs.

We did hit one year of upper class, both of us were working, I had to hire a maid to come in once a week and 3 of my 5 shifts a week covered paying her, but still. We had no more than when I wasn't working... the money always went poof. We rented a house and didn't have new cars but still had nothing. No McMansion ever here.

It comes down to land is the thing to have, and transportation, alternative methods are good. I walk a lot and the thought of a 5 mile walk doesn't faze me. I can carry 40-50 pounds home too. So. It saves gas, wear and tear on vehicles, and is good for me too (doctor ordered exercise and he checks-I have to wear a fitbit and it finks). I don't need all the bells and whistles (though we do invest in tech stuff knowing it will age off, the value of having and using it is what we carefully balance).

I hope that this recent post brings this good topic back into the mainstream as well as it is indeed a good topic.

Deb Rebel wrote:I hope that this recent post brings this good topic back into the mainstream as well as it is indeed a good topic.

I agree it is a great topic!