Save Money Easily With These 3 Tips by Warren Buffet

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Warren Buffett, The CEO of Berkshire Hathaway and popularly known as the “Oracle of Omaha”, ranked number two on the Forbes 400 richest men for 15 years straight. According to Forbes, his Real Time Net Worth is $73.8 Billion and he ranks sixth among the richest men in the world as of 2017.

It is rightly said by wise men that wealth cannot be accumulated in days or with shortcuts and that most successful men start early in their lives. The life journey of this business leader, excellent investor and a highly regarded Philanthropist is the best example of what those wise men said.

Warren Buffett purchased his first share at the age of 11, by 13, he was running his own businesses as a paperboy and selling his own horseracing tip sheet and became a millionaire by his 30’s.

 He once said, “I always knew I was going to be rich, I don’t think I ever doubted it for a minute”. It’s quite apparent from his life that it was not mere serendipity on which his fortunes thrived but it thrived on his sincerity, sagaciousness and modesty. 

As much as he is known for his success and richness, he is equally known for his frugality. His advice and tips on saving and investment are enlightening and something which can be easily followed by anyone. 

”Don't save what is left after spending; spend what is left after saving” - Warren Buffett

Saving money can be easier by following these 3 simple yet effective tips by Warren Buffett

 

1)      Practice Living a Simple Life 

 

 

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Warren Buffett, one of the richest men in the world still lives in the same house in Omaha, Nebraska which he bought in 1958. When asked about the reason behind it in a BBC interview, he said, “I’m happy there. I’d move if I thought I’d be happier someplace else”, “How would I improve my life by having 10 houses around the globe?” This gives us an insight that even after being a millionaire his notion of happiness hasn’t changed.

Often we perceive a man as wealthy just because he spends a lot, whereas the real scenario could be different. This man who may not be not so wealthy enjoys being considered one and hence continues spending more than he earns. He feels the urge to maintain a certain lifestyle. This is the case of many of us today. Often we spend more than we have because we think it’s the right thing to do or because the society considers it elite and expects us to do so. Like throwing a big party on our 18^th birthday or buying a bigger car when we are promoted. This demonstration effect, the need to “maintain a lifestyle” is the main reason why many people are in debt.

We also often perceive a man as happy just because he is wealthy and lives lavishly but again the real scenario could be different. Our wrong notion of considering luxury and happiness as synonyms is the real reason we cannot save. Opulence is attractive but not enriching, whereas modesty is not attractive but is enriching. We are so used to take the easier way that we end up spending a lot. We take the cab instead of the bus, we book movie tickets online even though the multiplex is just near our house. If we avoid spending on such useless luxuries, we’ll be a lot richer.  Warren Buffett says that if we can differentiate between luxury and happiness, we can save a lot and thus become truly wealthy.

     2) Spend Wisely

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Many of us don’t think before making a purchase. We buy gadgets that we don’t understand, buy apparels just because they’re trendy, attend a concert just because it’s the talk of the town. Before making a purchase, we should check whether the product is going to help us in any way or whether it’s a good investment. Quite often we find an old piece of clothing from our wardrobe and think, “why did I even buy this?" Or it also happens that we buy a product, bring it home and think, “I should have bought the other one."  Warren Buffet quotes, “If you buy things you do not need, soon you will have to sell things you need."  Quite true for a majority of us.

  

Don’t fall for the sales techniques that the companies often use. We get intimidated when we hear “Buy two and get one free” and end up buying three t-shirts of nearly the same kind and feel happy that we brought home something free. Free in the commercial market is a myth. If we don’t fall into such traps and avoid buying things that we don’t require, we can save a lot and be able to buy things that we actually require. If Warren Buffet, one of the richest men in the world is frugal and likes buying things at a bargained rate, why can’t we? Look out for good deal and sales. If you anticipate the desired product to be put on sale, waiting for the sale is more logical than buying the product at the current high price. Practice frugality like Mr. Buffet.

Warren Buffet once said, “Long ago, Ben Graham taught me that ‘Price is what you pay; value is what you get.’ Whether we’re talking about socks or stocks, I like buying quality merchandise when it is marked down.” Higher prices do not always mean higher quality. We often spend on branded items and compromise with quality best suited for us. If we avoid our vision to be blurred with branded items and look for quality, we’ll be better satisfied and be able to save a lot for the future

     3)      Live a Luxurious Life

 

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Warren Buffet says that if we do a job that we love and enjoy, we are actually living a luxurious life. During an interview with CNBC, Warren Buffett quoted, "Success is really doing what you love and doing it well. It's as simple as that. Really getting to do what you love to do everyday - that's really the ultimate luxury…your standard of living is not equal to your cost of living." And what Buffett loves to do everyday is work at Berkshire Hathaway.

If we are happy in the job that we are doing, we’ll refrain from looking for happiness by spending on useless things.  Most of us are not able to save because we look for materialistic pleasure which is temporary. We associate happiness or enjoyment with a material and spend impetuously and when the temporary enjoyment of that material ends, we spend again. If we do not have a fulfilling job, we can at least spend on a fulfilling hobby. This way we can control our mind from wandering around intimidating commodities, be focused on what is fruitful and ultimately save a lot of money.

Warren Buffett says that investing in oneself is the best investment, a luxury in every sense of the word. In one of his speeches, he said, “Imagine that you had a car and that was the only car you'd have for your entire lifetime. Of course, you'd care for it well, changing the oil more frequently than necessary, driving carefully, etc. Now, consider that you only have one mind and one body. Prepare them for life, care for them. You can enhance your mind over time. A person's main asset is themselves, so preserve and enhance yourself.”

We are extremely precious therefore invest as much as you can on yourself, starting from right now and in no time you will get tremendous returns. This way you are saving today and investing for the future.

Learn more about saving and investment by watching this amazing video on YouTube One idiot The Movie