A s a society of we the people for the people, we each have our own concept of how much wealth is enough for us. But what is that we really want and what can we really live without. Author Jeff Yeager goes into detail about how lived his life in way that he and his wife could retire at the age of 40 with no mortgage.
Excerpt from “How To Be A Savvy Cheapskate:
What sorts of decisions?
Well, for me, it’s all about the bigger financial decisions in life. I rail against the latte factor … for 20 years, pundits have been saying that if you give up your daily Starbucks cup and bank the money, you can attain financial security. That may work on paper, but I don’t think it works that way in reality, for most people. One [of the bigger decisions] is housing. I’m a big believer in finishing in your starter home: Buy a modest home when you’re first starting out and ignore people who tell you not to pay it off right away. Pay off your mortgage as quickly as you can, settle in and get to know your neighbors, and make your house your home. The conventional wisdom before the housing bubble burst was that if you could afford to pay down your mortgage early, instead take that extra money and invest it because mortgage money is relatively inexpensive to borrow. The financial pundits at the time said that any idiot could make a return on their investment above 5 percent or 4 percent of their mortgage interest. … Well, it didn’t work out that way.
These days with the tight economy, you hear so much in the media about economizing. But that’s almost always about “how to get more for less” … how to clip a coupon or find a bargain. But I think we’re missing what could be the golden epiphany of these hard times: We shouldn’t be asking ourselves “How can we afford it?” We should instead be asking, “Do we really need it?” There’s lots of social science that shows that once you’re above poverty level, more money and more stuff doesn’t contribute to happiness. I believe that most Americans would be happier, and the quality of their lives would increase, if they would only spend and consume less. If you believe as I do, I think there will be a lot of upsides to the current recession in the long run.” Read More
