A Dollar Saved is More Than a Dollar Earned
Why saving is more powerful than you think…
Here’s everything you need to know about personal finance in less than ten words:
Spend less than you earn and invest the difference
Now, obviously as you begin to apply it, things get more complicated than that, but that’s the main idea.
There’s obviously three separate pieces there:
- Spend Less
- Earn More
- Invest Wisely
Getting better at any one of the three will improve your finances, but sometimes you need to choose which of these levers you are focusing on. The first two work together to get you the money needed for the third. This means that it’s often hard to focus on both at once.
I’ll talk about my ideal strategy at the end, and I’ll make the case for earning more in a future piece. Right now I want to make the case for frugality and talk about how to do it well.
As far as I can tell, there are three main ways that frugality beats income generation:
Frugality is Faster
Getting paid can take a long time.
