You don't need a high income to achieve Financial Independence.
Making more money helps, sure, but if you're diligent about cutting costs, it's possible to reach financial freedom on even an average salary.
I want you to meet my friend, John. John is an 81-year-old retired shop teacher. He's a millionaire — but you'd never know it.
John started life as a carpenter. In his thirties, he went back to school to become a teacher. He spent the next twenty years teaching shop at a junior high school in a poor part of town. He retired to financial freedom at age 58. He never had a huge income and he didn't inherit a fortune.
So, how'd he get rich? He pinched his pennies and doted on his dollars. John achieved Financial Independence by ruthlessly cutting costs.
- John doesn't live in a mansion. He lives in the same small ranch house he bought for $10,500 in 1962. He paid off his mortgage early, and has now lived in the place for 53 years!
- John doesn't drive a brand-new Mercedes or BMW. He drives a 1998 Chevy minivan he bought for cheap five years ago. It's ugly, but he doesn't care. It meets his needs and he has no plans to upgrade.
- John doesn't take lavish vacations. He spends his summers in southeast Alaska on an old 38-foot fishing boat that he bought with cash in 1995. He spends his winters doing volunteer work on farms and ranches in New Zealand.
- John doesn't like to dine in fancy restaurants. He'd rather make his own meals at home. “For me, restaurants are a waste of money,” he says. “I don't appreciate them.”
Does John sound like a typical millionaire to you? If you were to believe TV, movies, and magazines, you might think most millionaires live like this:
We're constantly bombarded by messages that wealthy people enjoy lavish lifestyles filled with luxury. From my experience meeting with dozens of millionaires over the past decade, this kind of lifestyle is the exception not the rule.
But don't just take my word for it. Let's look at what the experts say. [Read more…]