Achieving financial success and accumulating wealth is often seen as a combination of hard work, strategic saving and smart investments. While each millionaire’s journey is unique, there are common (and uncommon) spending habits that many self-made millionaires share.
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Surprisingly, frugality plays a significant role in their wealth-building strategies. Here are six things frugal self-made millionaires never waste money on.
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1. Sports Equipment
Many might assume that the wealthy would splurge on the best sporting equipment for their hobbies or fitness routines. However, David Ciccarelli, the founder and CEO of Lake, an online vacation rental platform, says he doesn’t buy sports equipment that he likely won’t use often.
“I won a golf bag I use and the clubs were either hand-me-downs or again, items I won in charity golf tournaments,” said Ciccarelli. “I only golf a few times a year — if that — so, I can’t really justify the investment.”
2. Financial Advisor Fees
While financial advisors can provide valuable insights and guidance, fees are often associated with these services which can add up.
“I never waste money on a financial advisor that charges an asset under management fee,” said Jim Wang, Founder of Wallet Hacks.
Wang was working with a financial advisor who charged $4,000 per year. After five years, he paid $20,000 in management fees.
“The biggest benefit was having someone look over our portfolio and give us feedback about different allocations for long-term planning,” Wang added. “But the funds themselves were more expensive than something like Vanguard or Fidelity and we now use a fee-only financial advisor who we pay hourly.”
3. Gym Memberships
Physical fitness is important, but for some self-made millionaires, this doesn’t mean that paying for a gym membership is required or necessary to stay in shape.
“I’ve wasted money on gym memberships and won’t do it again,” says Andy Hill, a podcaster and Founder of MarriageKidsandMoney. Hill used to work in sales and he and his wife were able to increase their net worth significantly over the span of 10 years by paying down their mortgage, saving aggressively and investing consistently. They hit the $1 million net worth mark in 2020.
“I know my habits and that I don’t tend to visit the gym more than a few times so I’d rather not waste money,” Hill said. “Today, I prefer going for a run or exercising for free with Bully Juice videos on YouTube.”
4. Hair Services
Regular visits to high-end salons can add up quickly. Self-made millionaires may have more room in their finances to pay for these services, but some surprisingly choose to skip the cost altogether.
“I don’t spend money on going to the hairdresser since the average hairstyle for a woman of color is $200,” says Ange Matthews, a Personal Finance Expert and Wealth Strategist for Happy Investor Method.
She says she started learning how to style her hair from YouTube videos four years ago.
“If I saw someone with a style, I asked what it was and Googled the tutorial online,” said Matthews. “At first it was really hard and took hours, but after a month or two it got easier.”
5. Luxury Handbags and Shoes
While it might seem that millionaires are constantly adorned with luxury accessories, some self-made individuals avoid spending excessively on high-end handbags and shoes. They recognize that these items often come with hefty price tags and provide little functional value beyond their brand name.
“We don’t buy designer clothes, shoes, jewelry, handbags, or other expensive fashion accessories,” says Brock and Becky Waterman from the FIRE Travel Family. “Instead, we acquire clothes frugally, and usually secondhand at garage sales, thrifty stores, and from friends and family.”
“I actually used to buy luxury handbags and shoes before I pursued financial freedom, but I did this only to seem impressive,” says Bernadette Joy, a debt-free millionaire and Founder of Crush Your Money Goals. “Now, I buy only good quality items from lesser known brands and consider my retirement investments my new luxury bags,” Joy said.
6. Streaming Services
It’s easy to accumulate multiple subscriptions these days with each costing a monthly fee.
“I have one subscription for a service that specifically provides Asian content that I am not able to get in the US,” says Joy. “Otherwise I just use YouTube for entertainment.”
Joy also recently started the habit of “screenless Sundays” where she locks her phone in my car and challenges herself to spend the whole day without looking at any television, computer or phone screens.
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“It’s been a great reminder that there’s so much to see out in the real world,” she said.
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This article originally appeared on GOBankingRates.com: I’m a Frugal Self-Made Millionaire: 6 Things I Never Waste Money On
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