Great Savings 19 – Less Is Really More

 

Consider these two concepts: 1) Wealth equals opportunity, and 2) Less Is Really More. From first glance it would appear that the more wealth you have the more things you can take advantage of so how then could less mean more? Let’s find out.

 

Great Savings Tip 19 - Less Is MoreFrom a savings standpoint, we’re all about encouraging people to make better choices with their money. As we see it, people are constantly inundated with new choices to part with their cash. Every ad we see is geared to get us to spend more. Every store we walk into urges us to buy more or buy now. In fact, stores are expert at finding ways to trick us into thinking we’re getting a good deal by buying today, keeping us in the store longer than we planned, or toying with our senses—particularly sight, smell and taste—in order to lure us into buying something we hadn’t intended on buying when we came through the door. In essence, we face a constant battle where the victor is the one who ends up with the cash.

 

A statue of angels.

Is art a necessity? What would your life look like without it?

Rather than be a loser in the war to get you to spend, we think it’s important to develop a true sense of “mental armor” as you go about your day. To us, mental armor comes from developing core beliefs around possessing fewer or less expensive things. This then becomes a matter of definition. One could say anything physical is a thing or object, but as we need certain objects for our basic survival (think food or a roof over our heads) it may be more useful to define “material objects” as things not needed for basic survival. An example might be a painting or work of art. Of course, even this fails to address the issue at stake for if we rule out art or other “pleasures” in life as unnecessary expenses doesn’t that give life itself less meaning?

 

Is this a castle or a hovel?

Could you live in a place like this? Wouldn't it look grand if you were homeless?

And there are layers here too. For instance, a roof over our head can be defined in a multitude of ways. For those on the street, it might look as simple as a cardboard box or an old tarp. Or for those with unlimited means it might require building a 128 room estate. Clearly, there is additional cost associated whenever we buy a “nicer home” and how we define nice might easily be determined by how much money we have, our particular tastes, or by our desire to surpass those we choose to associate with. We have to keep up with those Jones’s, right?

 

What's in your future?

As we go to talk about money it's worth trying to envision the future. What's in your future? Do you see yourself penniless or having saved money for travel or retirement?

Core beliefs surrounding material possessions are therefore different for different people. Yet for our purposes, it’s important to understand that every decision to buy bigger when smaller will do is a decision to limit our ability to accumulate wealth. This is where we go back to our statement that “Wealth equals opportunity.” Whether we wish to buy something physical (like a car) or buy an experience (going to college) it takes money. Thus, the more money we have in our possession at any given time—that is the more wealth—the more opportunities we’ll have to choose from. Extend this out a bit and think of retiring: Without a substantial retirement nest egg, the opportunities to travel or get the medical care we need as we get older might be severally limited.

 

Curiously, it takes a conscious and continual effort to spend less, buy smaller, and think in longer terms in order to save more and accumulate wealth. This means wealth and the associated opportunities it presents to us are best achieved by understanding and living by the “Less is more!” creed.

 

 

Less is more can mean more opportunity down the road.

If you choose not to save, you could look at it like burning up future opportunity. Some call this opportunity cost--what you give up down the road for making a certain decision today.

Since we now know that buying less is really the means to get the most from life, how should we go about it? Whenever you’re presented with an opportunity to part with some of your money ask these three questions before reaching for your wallet:

 

Question #1: Is this something I want or something I need? It’s important to understand the difference and what it means to your long-term goal to accumulate wealth. (For more on this subject see Great Savings 8 –Limit Unconscious Spending and Great Savings 10 – Spending Consciously To Build Wealth.)

 

Should you get a small car or a large one?

Do you really need that bigger car or house? Will it give you that much more in terms of your quality of life? It might. It depends.

Question #2: Do I have to own this particular item to get the experience I’m looking for? When I was young I would buy albums or DVD’s to get the entertainment experience I wanted. Now, I can get these things free or very cheaply online. And I save room too! (For 26 ways to get free entertainment see Great Savings 86 – Free Entertainment.)

 

 

Go watch a beautiful sunrise.

Do you really lose by spending less? It's hard to put a price tag on this sunrise.

Question #3: Is there something of similar value I could buy, borrow or rent that costs less? Do you need to own? Could you borrow instead? Could you buy something with the same functionality, but that costs much less, such as a sub-compact car instead of a SUV? If you can and choose not to then remember you’re throwing away potential opportunities down the road. (For more ideas here check out Great Savings 15 – Rent, Borrow or Buy Used)

 

Action Item: The next time you’re in the store ready to make a purchase ask this: Is the item something you really need or something you want? If it’s something you want, do a search first (internet or otherwise) and see if you can get it for less somewhere else, or better yet find out where you can borrow or rent it. It’s your choice.

 

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