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6 Shocking Frugal Lessons from the World’s Richest People

by Jason on September 20, 2010

Did you know that some of the world’s richest people have frugal tendencies?

So says Jean Folger, in her article 7 Spending Tips from Frugal Billionaires found on Yahoo Finance.

They could buy anything and everything, and yet, they choose to restrain themselves.  Their money tips offers us some good perspective!

Take for example, Carlos Slim, a telecom tycoon, who has a net worth over $60 billion, yet chooses to skimp on luxury items!

This guy wouldn’t run out of money if he spent $1,150 a minute for the next 100 years!

It’s encouraging to see some of the world’s richest people consciously living below their means.

I’ll highlight the money tips in the article and add some of my own commentary.

We can definitely learn a few things from these tips:

1. Keep Your Home Simple

Jean says, “[F]rugal billionaires like Warren Buffett choose to keep it simple. Buffett still lives in the five-bedroom house in Omaha that he purchased in 1957 for $31,500. Likewise, Carlos Slim has lived in the same house for more than 40 years.”

I was shocked to read that initially.  What we don’t know here is how many vacation homes, cabins, chateaus or palaces they have around the world.

But we can definitely learn something –  Don’t bite off too much house!

2. Use Self-Powered or Public Transportation

Jean tells us that, “Thrifty billionaires including John Caudwell, David Cheriton and Chuck Feeney prefer to walk, bike or use public transportation when getting around town.”

Very cool.  Frugal and environmentally safe (aside from the bus fumes).

Here are 10 more tips to save money on your evening commute!

3. Buy Your Clothes off the Rack

Some folks, whether billionaires or not, place a huge emphasis on designer clothes.  It’s cool to see some frugal billionaires deciding it’s just not worth it!

Jean says, “John Caudwell, mobile phone mogul, buys his clothes off the rack instead of spending his wealth on designer clothes.”

And don’t forget the guys from Google who roam around in jeans and t-shirts.   Maybe it’s time for you to embrace the thrift store ethic!?

4. Keep your Scissors Sharp

Jean says, “Billionaires like John Caudwell and David Cheriton opt for cutting their own hair at home.”

These guys can afford to spend money on haircuts at the most posh salons around the world, but they choose to save a few bucks by doing it at home.

Or, they hire beauticians from the posh salons to come to their house, which I imagine would get pretty expensive, but at least you’re at home.

Speaking of scissors, check out what a Cow, a Red Box and a Pair of Scissors have in common.

5. Drive a Regular Car

I love this one.  Especially since, if I was a billionaire, I’d be driving the most exotic cars I could.

These billionaires don’t care about keeping up the image of a rich and famous lifestyle.  Some frugal billionaires pride themselves on driving their beaters!

Jim Walton (Wal-Mart) drives a 15-year-old pickup.  Jean also states, “Azim Premji, an Indian business tycoon, reportedly drives a Toyota Corolla. And Ingvar Kamprad of Ikea drives a 10-year-old Volvo.”

Of course, if you’re going to do this, you need to keep your car in tip-top shape.  Here’s some additional tips to keep your car running longer.

6. Skip Luxury Items

Now this is shocking – Carlos Slim (currently ranked as Forbe’s wealthiest person) does not own a yacht or a plane!

I love what Warren Buffett says about luxury items:

“Most toys are just a pain in the neck.”

In our pursuit of the American Dream, we race around trying to “buy up” on everything.  Luxury isn’t a bad thing, but too often we make it our idol!

What We Can Learn

Here’s a few takeaways:

What Are Your Thoughts?

  • Did these tips surprise you coming from billionaires?
  • What other frugal tips have you found helpful in your own personal finances?
  • Word has it they really love birthday freebies too! 😉

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