[ericd]

The only way to become wealthy is to spend less than you make. The only way to stay wealthy is to spend less than you make (and have your investments outpace inflation). One of the best ways to do that is to not inflate your lifestyle, like starting to think you're too good for things like putting together your furniture from Ikea.

[saget]

Some of the wealthiest people I know are also the cheapest. The other week my gf's parents (very well off) refused to go to a clinic that their insurance didn't work at after their son cut off the tip of his finger. Took them and hour to find a place to go. It seemed absurd from my perspective to put a few hundred dollars in front of a medical emergency when you can afford a private plane, but I guess that's part of why they're rich.

[ericd]

Heh at that point, I'd say they're being cheap to the point of not being practical. A slightly greater chance of restoring that finger to full use is worth a lot more than a few hundred bucks if you're not seriously low on money. But yeah, their cheapness probably has something to do with why they have so much money stored up.

[atomical]

If it is a few hundred dollars to stop the suffering sooner it sounds like OCD.

[afterburner]

> The only way to become wealthy is to spend less than you make.

This is hilariously wrong.

[ericd]

Feel free to elaborate on why it's wrong. I don't mean spending less than you make at all times, and I don't mean "make" as in "earn at a wage-earning job", there are many more ways to make money than that. In the long term, your wealth is the money you've made (including capital gains), minus what you've spent.

You might say that's completely obvious, but it helps some people to be reminded of it.

[greenleafjacob]

It's not wrong, but think of it this way: if you short a stock, your downside exposure is unlimited because the price can go arbitrarily high, but your upside is finite because the stock can only go to zero. In the same way, you can only decrease your spending so much, even to zero, but you can increase your income by an unlimited amount.

[ericd]

Yep, you're right. For many people, though, increasing their income substantially is harder than decreasing their spending substantially, and also, many people are in the habit of increasing their spending when their earnings increase by, say, switching from Ikea to higher end furniture, or trading in that used Honda for a new Mercedes. For many people, it's so bad that they end up not saving any more, while putting themselves in a more precarious position if their income ever dried up.

[afterburner]

"Wealthy" and "wealth" mean different things.

You also used the word "only".

Your sentence read as "you can't become rich other than just saving on expenses." Maybe you can see how that is a really weird thing to say.

[wmeredith]

Over the long term, it is correct. I think you may be spending with investments.

[closeparen]

If furniture can make or break you, we're talking about degrees of middle-class-ness, not wealth.

[ericd]

It's not just furniture, it's staying at nicer hotels, going to Bora Bora instead of Hawaii, buying a Mercedes instead of a Honda, buying a boat instead of renting one. Each thing on its own wouldn't break someone with some money, but it adds up. And you can keep ramping that up, especially if you get into something like private aviation.