Crippled CEO Blog #098:
Rich person: *acts frugally*
Regular people: “Well, that’s how he has all that money.”
There’s a problem with this trope.
It’s not true.
You can’t get rich by saving money.
The math just doesn’t work.
If you make $50,000 per year, the most you can possibly save is everything you make — $50,000 per year. And if you do that, it will take you 20 years to have $1 million.
But you can’t save everything you make. Under $70,000 a year or so, you can’t even save half of what you make. You need money to survive and enjoy your life.
Spending time, energy, and willpower skipping affordable things you enjoy in order to save a few dollars a day isn’t going to get you the financial results you’re looking for.
The path towards financial independence is paved entirely by making more money. Getting raises at your job, side businesses, and so on.
Now, if you are saving money and investing it in something that makes you more money, that’s different. That’s another revenue stream. Definitely do that. Compound interest is powerful, especially if you’re young.
But skipping Starbucks every day to save $1,500 a year? Stop that. It’s not helping. It’s just making you cranky, which is probably causing you to miss opportunities. Buy the coffee, and use the caffeine to make extra cash.
(You know who is all about additional revenue streams? Your mom. She also never misses a blog post because she sent a text to 484848 with the word CRIP as the message to get a link each week. You should do the same.)