When I was younger, I had been quite fascinated with celebrities and their lifestyles, and even more so if these aforementioned celebrities were frugal. As a kid, I remember fondly watching The Lifestyles of the Rich and Famous with Robin Leach’s voice describing in detail how the rich and famous lived. Contrary to popular belief, not all rich and famous live ‘richly’. Here are some frugal habits of the super rich that you might find interesting.
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Frugal Habits of the Super Rich
These individuals are definitely ultra high net worth individuals. Yet many of them don’t have the typical ultra high net worth lifestyles that you would imagine. What constitutes ultra high net worth? As a reminder, ultra high net worth individuals have over $30 million USD in investable assets.
There are ultra wealthy who don’t act like they are ultra wealthy and instead, live frugal lives.
Being frugal vs being cheap are not the same, I would call myself relatively frugal but I’m not cheap and consider myself quite generous with friends and family.
These uber rich have an inner scorecard rather than an outer scorecard. They don’t care what others might think of them.
These lifestyles of billionaires (some of them anyway) are more modest than you might assume. Here are some frugal habits of the super rich.
The most famous frugal and wealthy person in the world is probably Warren Buffett. As of writing Warren Buffett’s net worth is over 98 billion dollars.
I’m a big fan of Warren Buffett. He bought his house in the 1950’s for $31,500 and still lives in it today. It is worth much more now but he hasn’t felt the need to upgrade to a huge mansion despite his billions. He also has a modest car, a Cadillac XTS that was purchased for under $50,000.
Even though he owns $16.7 billion (in 2017) or 9.4% percent stake in Coca-Cola, his wife Astrid still stocks up his Coca-Cola supply when it is on sale.
In the “Becoming Warren Buffett” documentary, the chosen McDonald’s breakfast sandwich that he buys is dependent on how the market is performing that day. If the market is having a down day he feels like he doesn’t deserve the more expensive McDonald’s breakfast sandwich and will get the cheaper option.
He is a multi-billionaire and he doesn’t feel like he deserves to get the more expensive breakfast sandwich option which is ‘more expensive’ by less than a dollar in absolute figures, and even then that’s like under $3.25 a sandwich.
Another frugal ultra wealthy individual is Lebron James.
Lebron James likes to self identify as the “cheapest guy on the NBA”. He’s worth over $86 million and refuses to turn on data roaming when he’s playing the Toronto Raptors here in Canada, and instead just sticks to wifi. He also does not subscribe to the streaming music Pandora and uses the free version that is not ad-free.
I don’t blame him, data roaming is expensive and I refuse to pay for that too if I were in the United States but I wouldn’t be able to manage on just wifi. Maybe he should look into Roam Mobility alternatives when he’s here next time.
I’m not really a fan of Will Ferrell movies but he seems very down to earth despite having a net worth of over $160 million.
In this video Kevin Hart explains how frugal Will Ferrell really is, you can skip to 1:45 to hear what he says about Will Ferrell’s frugality.
How frugal is Will Ferrell? So frugal that he still uses a Blackberry phone. I haven’t seen a Blackberry phone in ages, personally.
He also wear’s what Kevin calls a “grab bag style” clothing, meaning that all his T-shirts are from free events. You know, those T-shirts that you get when you volunteer, that you might only wear around the house?
Jack Ma, the founder of Alibaba is worth over $37 billion. Alibaba is like the Amazon of China (and then some).
In the book Balance by Andrew Hallam, he talks about how many of the word’s richest people, the world’s billionaires, don’t actually drive Bentleys, Maseratis, or other expensive cars. It was indeed interesting to review the list and see that many billionaires preferred to drive safe and standard cars.
One car stood out for me, and that is the one driven by Jack Ma, because it was the lowest cost of the billionaires on that list. It only cost about $15,000 USD.
This is what Jack Ma drives, a Roewe SUV that costs under $25,000 CAD, picture courtesy of Canada Drives. Could Jack Ma be classified in the group consisting of of cheap billionaires? You decide.
Keanu Reeves’ net worth is over $380 million but he’s well known for living simply. He rides the takes public transit and rides the subway. There are lots of pictures of Keanu Reeves taking the subway like common folk.
Despite his frugality, he is generous and once bought Harley-Davidson motorcycles for 12 stuntmen on set to thank them for their hard work.
Keanu Reeves is quoted as saying “Money is the last thing I think about. I could live on what I have already made for the next few centuries.”
From the Wealthy Gorilla:
Another frugal billionaire is Ingvar Kamprad.
Ingvar Kamprad founded Ikea. Everyone knows what Ikea is.
He was worth over $40 billion when he died at age 91. He grew up as the son of a farmer in Sweden and started out selling pens, and small stationary items on his bike.
Even as his company reached the pinnacles of success, he still wore second hand clothes bought only from flea markets, flew economy class, and brought a packed lunch to work every day.
Canada Drives also shares a picture of the 1993 Volvo 240GL that Ingvar Kamprad drove for decades until he wasn’t allowed to drive anymore in his 90’s.
Another frugal super rich individual is John Bogle.
I can’t have a personal finance blog without mentioning John Bogle. John Bogle is the creator of the Vanguard funds and really owe our ETF investing simplicity options to him. He died in 2019 at the age of 89 and was worth over $80 million.
Like Warren Buffett, John Bogle had led a simple life.
Habits and Values of the Frugal
As mentioned, all of these financial successful individuals have a theme in common, and that is of knowing what their values are and not being worried about what others might think of them.
Although being frugal alone can’t make you rich in Canada quickly (there is sentiment that you can enjoy your latte per day and that a latte doesn’t matter that much in the grand scheme of things), your spending habits do add up over time.
Instead of just practising frugality, probably the most important thing is to spend less than you earn (and you can do that by starting to track your net worth and also by tracking your spending) so that you can invest that money and compound it over time.
As I often say, you don’t know where you’re going unless you know where you stand.
I use Wealthica to track my net worth in addition to handwriting it in a journal.
Here’s what the Wealthica net worth tracker looks like (this is not my liquid net worth, FYI!).
Although you might not become super rich like the folks mentioned above, you’ll likely live a comfortable life nonetheless… and might even get to enjoy the outer scorecard type attention that you would inadvertently get from private banking in Canada.
Do you practice any of these frugal habits of the super rich yourself?
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GYM is a 30 something millennial interested in achieving financial freedom through disciplined saving, dividend and ETF investing, and living a minimalist lifestyle. Before you go, check out my recommendations page of financial tools I use to save and invest money. Don’t forget to subscribe for blog updates, a free dividend yield spreadsheet, and the free Young Money Bootcamp eCourse.