Saving is a habit of thrift. Reducing wants is the foundation of thrift. It comes from the basic understanding that we can do without many of the things that other people buy. We can avoid them entirely. If not, we can find better alternatives.
- Avoid alcohol and cigarettes. In the short run, you are paying more sales tax and insurance. In the end, it increases your medical expenses.
- Avoid owning jewelry and expensive watches. You have lost 20% or more the moment you buy them. They are not investments.
- Save on clothes. Men need only about 2 suits and 5 sets of casual clothes. Women need only a little more. I know many high-income people who have just these basics. Their careers did not suffer.
- Have no more than 2 pairs of formal shoes and 1 pair of casuals.
- Minimize purchase of kitchen gadgets. A few basic utensils are all you need. You can do without many of the specialized gadgets sold in supermarkets and by direct sellers. All you need is a little imagination. Example: You can easily make yoghurt in the traditional way and dispense with specialized equipment. Example: We once bought an electric deep fryer but used it only once. Since we are a small family, frying a few things is not worth the large amount of oil needed by the fryer.
- Minimize expenditure on cars. Choose one that is good enough to get you from A to B. Own it for as long as you can, e.g. at least 10 years. Consider buying a two-year old vehicle instead of a new one. One friend specialised in owning 10-year old European cars auctioned by large companies.
- If you are renting, choose a smaller house or apartment than you can afford. Otherwise, consider sharing a house with others.