How to Get Rich by Living Below Your Means

Updated on May 9, 2020
Robie Benve profile image

Robie writes to help people acquire financial strength. She got her MBA from the University of Venice, Italy.

Learn simple strategies that can help you get rich by learning to live within your means and taking control of where your money goes. Financial tips with a positive approach that will change the way you think about money.
Learn simple strategies that can help you get rich by learning to live within your means and taking control of where your money goes. Financial tips with a positive approach that will change the way you think about money. | Source

Make a Long-Term Plan to Get Rich

Imagine:

  • Your money feels plenty every month.
  • You can afford the things you need.
  • You can save for future vacations and big purchases.

How do you achieve that? It’s not an overnight change - unless you land a better-paid job or a huge inheritance.

You need to change your attitude towards money and possessions, make a plan, and stick to it. Only then you'll be heading towards living a life of abundance and richness.

Pursuit a life full of more of what you love, and less of what you don’t.

It’s a process and a lifestyle choice, but it can be done.

Let's take a look at the different things you can do to make that happen.

What to Do to Get Rich

In this article, we'll talk about the following strategies that, with some work and motivation, can help you get rich.

1. It’s your money, be your money’s boss.

2. Cut meaningless expenses. Be ruthless.

3. Start owning and stop owing.

4. Right-size your home.

5. Pay less interest.

6. Drive used.

7. Got a raise? Live off your old income.

8. Find creative ways to increase your income.

9. Set your goals.

10. Dream big. Don’t accept mediocrity.

11. Choose an abundant living outlook

12. Prepare yourself for opportunities and make the most out of each one


Let's get started!

1. It’s Your Money, Be Your Money’s Boss

Learn to recognize what you need and take control.

Eliminate all the worthless expenses. Every person, every family is different. What is essential for you might not be so important for me, and vice-versa, but we all have some core needs that need to be fulfilled for us to be happy.

Find out what yours are, and keep them the focus of where your money goes.

Some examples of things that might be essential for you:

  • Housing
  • Food
  • Health
  • Entertainment
  • Technology
  • Transportation
  • Art, music, etc.

2. Cut meaningless expenses. Be Ruthless.

Are you ready for a change? Then change you must.

Take a very close look at where your money goes each month. Go through your spending habits and chop those unnecessary expenses like there is no tomorrow.

Which things do you really need?

Look at everything you have bought in the past and all the things you are paying for every month.

Find the things that are unnecessary (boring tv channels, often dining out, fancy coffees, etc.) and the things could have been bought for less (designer clothes, high-interest loans, tech devices, etc.).

Cancel subscriptions, consolidate debts, renegotiate the mortgage, stop eating restaurant food, keep using your old shoes and clothes, etc.

You’ll be surprised by how much “extra” money you have left at the end of each month when you manage your expenses in such detail.

Here is more info on being frugal and how to live below your means.

Take care of the pence; for the pounds will take care of themselves.

— William Lowndes, British Secretary of the Treasury, 1696–1724

3. Start Owning and Stop Owing

Sit down and write down all the things that are important and absolutely necessary for you in life.

Those are the things that you can spend freely on to make sure you have the quantity and quality you need. Those are the things that you may end up borrowing money and paying interest on.

Everything else, you don’t need to stress about or go into debt to own. They are not necessary, they can wait.

Plan to Get Rich and Work for It

Pursuit a life full of more of what you love, and less of what you don’t. It’s a process and a lifestyle choice, but it can be done.
Pursuit a life full of more of what you love, and less of what you don’t. It’s a process and a lifestyle choice, but it can be done. | Source

4. Right-Size Your Home

How much are you paying every month for rent or mortgage? Is that the best deal you can find, or are you paying extra because the home is bigger than you really need?

If you live in a big place, would you be willing to move to a different home that is smaller in order to save money?

5. Pay Less Interest

There is no point in paying interest on money borrowed to pay for things that you could have been happy without. Expensive vacation, latest tech devices, top-of-the-line appliances, not great reasons to get into debt.

  • Buy only what you need and make all efforts to buy it with money you own.
  • Pay off your credit cards every month.
  • Borrow only when absolutely necessary, and negotiate the lowest interest rate you can get.

6. Drive Used

New cars lose most of their value in the first couple of years. Buying used can save you a lot of money.

7. Got a Raise? Live Off Your Old Income

This is how my parents got rich, and many others in their generation.

My parents are entrepreneurs, and all their life they’ve always strived for new ways to increase their income. And they succeeded. From investing in assets to expanding their business, they always improved their financial situation.

But you know what barely changed? Their lifestyles.

They kept living at what they felt was a good level of comfort, without worrying about what others would think, and slowly they got rich.

Do the same. Don’t increase your expenses every time you get some extra money.

8. Find Creative Ways to Increase Your Income

If you are on a paycheck, you have one income coming in and you only have that one income to live on.

Always be open to (legal) ways of increasing your earnings. Put some effort into figuring out new and creative ways to bring money in.

Maybe you could start a new part-time job, tutoring, selling things you make, baby-sitting, dog walking, whatever would let you make productive use of the time you have available during the day.

If you can think of an activity that can create some extra revenue, some deserved peace of mind, and a sense of accomplishment, do it.

Always be open to new and creative ways to increase your earnings. Be ready to recognize opportunities when they come.
Always be open to new and creative ways to increase your earnings. Be ready to recognize opportunities when they come. | Source

9. Set Your Goals

What would a financial adviser ask you right off to help you plan for your retirement?

"How much money will you need to live comfortably?"

When you think of that, you need to add up all the necessary expenses to make sure you have enough.

Take that point of view and apply that to your current age.

How Much Do You Need to Save Monthly?

Write a list of things you and your family like to do and purchase in your near and far future.

It can be anything: being able to go on a dream vacation, buying the home of your dreams, ride a luxury car, you name it.

  1. Write your goals down.
  2. Put the desired date on them.
  3. Determine a good estimate for how much money you’ll need to save monthly to be able to afford each item.

Examples of Monthly Saving Goals

Goals
Cost
Timing
Required Monthly Savings
New Bike
$150
3 months
$50
iPad Pro
$999
6 months
$166.50
Car
$21,000
2 years
$875
TOTAL
 
 
$1,091.50
Write your goals down. Put a date on them. Determine a good estimate for how much money you’ll need to save monthly to be able to afford each item.
Dream big. Don't accept mediocrity.
Dream big. Don't accept mediocrity. | Source

10. Dream Big. Don’t Accept Mediocrity.

Stop accepting that being mediocre, like everyone else, is OK.

Create something new. Aim to be bigger than what you are, not less than what you are.

Create a strategy that makes you grow slowly but steadily.

What Can I Do? How Can I Get the Money for That?

Visualize yourself fulfilling all of your goals through hard work, yes, but also good planning.

Find ways to bring in more money, use your money wisely, and

I work very, very hard at being very lucky.

— Donna Nyzio, artist-entrepreneur

11. Choose an Abundant Living Outlook

More than anything else, being abundant is about how you see life.

Some people may have everything but they still feel poor. Some others may have less but they feel lush.

Look at what you already have and practice being grateful for it. Actively avoid any thoughts that make you complain about what you don’t have.

12. Prepare Yourself for Opportunities and Make the Most Out of Each One

Be ready for opportunities when they come. Often, the best opportunities feel foreign, scary, and challenging. Those are the best ones. If you have the skills and willpower to embrace them, they will make you advance faster in life.

  • Know your strengths - Opportunities can take many forms, they are usually unexpected and specific to your particular strengths.
  • Develop your skills - Keep improving, challenge yourself, take classes, develop skills that are relevant to your strengths.
  • Be open to change - Keep your eyes and ears open. Be on the lookout for opportunities, often they will be overlooked by others, and because of that even more powerful for you.
  • Work on it - Be ready to add a new layer of hard work and effort to your daily activities to pursue the new potential situation that you have in front of you. Often better and bigger things will open up once you get started working on a new endeavor with an open mind and flexible point of view.

Have a plan. Seize the opportunities. Be willing to work hard on them!
Have a plan. Seize the opportunities. Be willing to work hard on them! | Source

What We Learned During the Pandemic

Once we found ourselves isolated at home during the COVID-19 pandemic, we realized that at the end of the month we had a nice amount of money left over compared to life-as-we-knew-it.

We wanted this to stay the same after social-isolation is over! How do we make it happen?

Well, some expenses for gas, sports fees, classes, etc. are bound to restart as soon as activities are starting back up. But eating out, going shopping, buying treats and other things are surely going to be our choice.

And on those, we need to be very watchful and picky, and only indulge in the things that are truly needed and worth it.


This article is accurate and true to the best of the author’s knowledge. Content is for informational or entertainment purposes only and does not substitute for personal counsel or professional advice in business, financial, legal, or technical matters.

Questions & Answers

    © 2020 Robie Benve

    Comments

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      • Robie Benve profile imageAUTHOR

        Robie Benve 

        8 days ago from Ohio

        Thanks a lot for your comment Pamela, I really appreciate it.

      • Pamela99 profile image

        Pamela Oglesby 

        10 days ago from Sunny Florida

        Your tips are terrific. We are good about not owing anyone anything but we are far from rich. I would like to have lived the way you describe many years ago. This is an excellent article.

      • Robie Benve profile imageAUTHOR

        Robie Benve 

        10 days ago from Ohio

        Ciao Adrienne! You are right, I hear all the time older people saying that they got rich by saving the pennies, and during financial hard times like now it becomes even more important not to waste money over frugal purchases. Thanks a lot for your comment, I really appreciate it.

      • Robie Benve profile imageAUTHOR

        Robie Benve 

        10 days ago from Ohio

        Hi Thelma, you are right, it's never too late to start on the path of becoming rich. Happy saving and happy living to you. :)

      • Thelma Alberts profile image

        Thelma Alberts 

        11 days ago from Germany and Philippines

        Wow! This article is loaded with tips. How I wish I know this information when I was still young. I think it is not too late for me. Thanks for sharing.

      • alexadry profile image

        Adrienne Farricelli 

        11 days ago

        Ciao Robie,

        I see lots of good tips here, especially at a difficult time like now with the pandemic going on. It is true that many people are rich mostly because they live frugally instead of wasting their money over useless things.

      • Robie Benve profile imageAUTHOR

        Robie Benve 

        2 weeks ago from Ohio

        Thanks a lot Pamela, I hope your prediction is correct and some (or many, even better) people will find some helpful hints in this article. That's exactly why I write, to share useful tips about money and art with anyone that might find them useful. Thank you!

      • Pamela99 profile image

        Pamela Oglesby 

        2 weeks ago from Sunny Florida

        Robie, I wich I had been given all this wonderful information when I was 21. I think your tips are so true and my husband and I have worked hard to be retired without any debt. I think your tips will help many people.

      • Robie Benve profile imageAUTHOR

        Robie Benve 

        2 weeks ago from Ohio

        Thanks a lot Habiba, I truly believe that good fortune is more friendly with the positive minds. :)

      • Robie Benve profile imageAUTHOR

        Robie Benve 

        2 weeks ago from Ohio

        Thanks Liz, that's a great quote, I'm going to research it and include it in the article. Long live grandmas and their wisdom!

      • Eurofile profile image

        Liz Westwood 

        2 weeks ago from UK

        This is a very helpful article, posted at a very appropriate time. It's well written and nicely structured in a very reader friendly format. It reminds me of advice my grandmother used to give me, which would translate as "look after the cents and the dollars will look after themselves".

      • Habiba Bebo profile image

        Habiba Yasmeen 

        2 weeks ago from Rawalpindi, Pakistan

        very positive thought

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