Lessons to Learn from the Frugal Walmart Family

If you passed by the Walton family on the street, you would likely never even notice. Yet, the Walton family owns Walmart – which is worth, on the latest estimates, about $89 billion.

Amazingly, despite their immense fortune, the Waltons live quite frugally. Jim C. Walton, the son of Sam Walton, the original founder of Walmart, drives a 15-year-old Dodge Dakota truck. Other Walton family members have all been seen buying and driving used vehicles, as well as dressing in a down-to-earth fashion.

  • Drive a car until you can’t drive it anymore – Many of us are accustomed to driving new cars every few years, yet this is one of the worst financial decisions you can make. Selling your car (at a tremendous loss) to purchase a new automobile every few years will never allow you to truly get your money out of the car. Cars are a constantly depreciating asset, which means you want to invest as little as possible into them. Driving a car until its final days is the only way to begin to recoup some of the costs of purchasing the car. Plus, after a few years, you can enjoy having no car payments!

  • Make eating out a special occasion – Instead of making eating out a daily occurrence or even weekly occurrence, make it a special occasion, and otherwise, eat at home. You will likely be amazed at how much money you can save by preparing your meals at home. Plus, when you do go out to eat, it will be more of a treat and probably be appreciated more. And think of what you can do with all that extra money every month!

Why an NFL player who earns millions still drives a 26-year-old car he bought for $2

Last year, Dallas Cowboys running back Alfred Morris signed a two-year contract worth $5.5 million. In addition to a $1 million signing bonus, Morris will earn a fully guaranteed base salary of $1.2 million this season and is eligible for up to $1 million more if he leads the league in rushing and runs for 1,500 yards.

But Morris’s spending habits don’t reflect his paycheck. Case in point: He still drives a 26-year-old Mazda 626 sedan from 1991 that he bought for $2.

Morris purchased the vehicle, affectionately known as “Bentley,” from his pastor for just a couple bucks during his junior year at Florida Atlantic University. It garnered national attention in 2012 when he was drafted to the Washington Redskins and took Bentley with him.

“It just keeps me grounded, where I came from and all the hard work for me to get to this point,” said Morris in 2012 on the Redskins’ website.

5 Things That Prove Rich People Are Cheap

Of course, rich people spend a ton. In 2015 alone, the affluent upped their spending by 6.6% on luxury goods — largely driven by increased spending on travel, dining out, home entertainment and cars, YouGov found.

Still, many of them are very thrifty. Aside from eating at McDonald’s and enjoying cheeseburgers and pizzas, here are five more things that prove that:

They tool around town in a Ford

Sure, there are plenty of loaded Americans driving BMWs, but many drive far more modest cars. Data released in August 2016 by car site Edmunds.com found that the most popular car among those with incomes above $250,000 a year was the Ford F-Series, followed by the Jeep Grand Cherokee and the Jeep Wranger; the Lexus RX and BMW X5 were only the No. 4 and No. 5 on the list.

“There will always be an interest in and market for high-end exotic vehicles,” says Edmunds.com executive director of industry analysis Jessica Caldwell. “But, overall, most of the wealthiest Americans look for their vehicles to perform the same kind of functional tasks that everyone else does.”

Other studies show a similar penchant for modest cars among the wealthy: Among the top 10 most popular vehicles in America’s wealthiest neighborhoods, half are non-luxury vehicles, an analysis of car-buying habits of residents of the 10 wealthiest zip codes in America by TrueCar.com found. These include the Honda Accord, Toyota Camry, Honda CR-V, Volkswagen Jetta and Toyota Prius.

Warren Buffett’s Frugal, So Why Aren’t You?

Warren Buffett, perennially ranked among the world’s richest men, lives a lifestyle that hasn’t changed mush since before he made his billions. He is often referred to as the world’s greatest investor, and his long-term track record suggests the title is well deserved.  He is also legendarily frugal, residing in the same house in Omaha, Nebraska, that he bought in 1958 for $31,500.  He is well known for his simple tastes, including McDonald’s hamburgers, and cherry Coke, and his disdain for technology, including computers and luxury cars.   Underlying his legend is one simple fact: Buffett is a value investor.   It’s the hallmark trait of both his professional and personal success. 

The Personal Underpinnings of Value

Warren Buffett has a clear strategy for making money.  He often says, “The first rule of investing is don’t lose money; the second rule is don’t forget Rule No. 1.”  It’s a strategy he employs in his personal life as well as in his profession.   It begins by living far below his means.

Despite a net worth measured in billions, Warren Buffett earns a base salary of $100,000 a year at Berkshire Hathaway.   It’s a salary that has not changed in 25 years.   A man of simple tastes, including watching sports on television and eating junk food, Buffett easily supports his modest standard of living with this salary.