Jakarta, CNBC Indonesia – One of the secrets to getting rich is forming a thrifty mindset. However, the frugality habits of the rich sometimes tend to be different from other circles.
Wealthy people tend to have a habit of avoiding extravagance by not buying things that are less essential. On the other hand, the rich are also not stingy in replacing items that are expensive to maintain.
Tom Corley, accountant who doubles as author of the book spent five years interviewing 233 millionaires to study their habits and way of thinking. They come from different backgrounds and experiences, but all make at least an average of US$160,000 or around Rp.2.4 billion in annual gross income.
“I’m very interested in what they spend their money on. But almost everyone tells me that what contributes more to their wealth is because they stop wasting money on certain things,” said Tom, quoted from CNBC.com , Thursday, (6/7/2023).
Here are 6 buying habits that the rich avoid:
1. Processed and packaged food
To prioritize their health, the rich have opted to stop buying low-quality, processed foods and opt for organic or healthy foods that don’t contain preservatives.
“They often look for produce that can be obtained where they come from, and frequent farmers’ markets and grocery stores known for their high-quality produce and meat,” Tom wrote.
2. Cheaply made products
Billionaires tend to refuse to spend money on the latest fashion trends, or furniture that is cheap and poorly made. Instead, many choose to invest in timeless quality pieces to make them last.
Often, they cost two to three times more than low-quality clothing and furniture. But they feel comfortable making larger purchases, because that’s still cheaper than constantly replacing cheap perishables.
3. Major home or car repairs
In that same vein, many wealthy people say that if they were given a choice, they would rather spend the money to completely replace things like old roofs, washing machines, dishwashers, refrigerators, stoves, and even vehicles, than use the funds. their hard work to fix it.
While buying new items is often more expensive, tycoons rationalize that something new will last far longer than something repaired, which gives them invaluable peace of mind.
4. Garden cleaning tools and equipment
While people usually prefer to do some garden cleaning themselves, such as mowing, weeding, landscaping, and pruning, for the most part, once they become wealthy, they tend to hire a landscaper to take care of all the upkeep.
This keeps them from spending money to repair or replace old equipment. Many gave their tools to family and friends. What they bought was time.
Since they no longer need to set aside an hour or two every week or month to maintain their property, it gives them more time to rest, relax, or engage in recreational activities.
5. Lottery tickets, or slot gambling
Many billionaires avoided gambling as they built their fortunes, and that common sense extended to their new financial lives.
“They tell me that after they got rich they refused to spend money on lottery tickets, and would encourage their employees, family and friends to do the same,” explains Tom.
Rich people see that the possibility of winning the lottery or gambling is very slim, so they see it as a waste of money. Instead, it is better to use the funds for things that are more useful.
6. Impulse goods
One characteristic of the rich is having the ability to control the appetite for shopping. But that doesn’t mean that rich people don’t like to spend money to please themselves. The proof, we easily see luxury brands around the lives of the rich.
Warren Buffet says that if you buy things on impulse, soon they will become useless. Therefore, rich people usually think carefully before buying something.