7 of the smartest pieces of advice about saving money from early retirees – Business Insider

Focus on your spending, not your earnings.

Chris Reining headshot

Chris Reining.
Courtesy of Chris Reining


Chris Reining, who retired at 37 as a self-made millionaire, finds a difference between “living rich” and “being rich.”

He posted a Tweet earlier this year that read: “Living rich: Make $500k, spend $500k, don’t have two nickels to rub together. Being rich: Make $100k, spend $40k, have $1 million in the bank.”

Instead of measuring wealth as figures or material means, he defines rich from a behavioral standpoint.

“When people say they want to be rich, what they’re saying is they want to spend like a rich person. They’re focusing on earning a big paycheck,” Reining told me. “But that’s not the definition of being rich. The definition of being rich is having assets generating income that exceed your standard of living.”

He continued: “Someone earning $50,000 a year while they sleep from dividends and investment gains and spending $40,000 a year — they’re rich. I have friends earning half a million, and with private schools, second homes, and expensive lifestyles, they have nothing in their bank account — they’re poor. That’s why ‘rich’ has little to do with how big the paycheck is.

“Getting rich, and staying rich, is overwhelmingly a game of living below your means. If you can do that you’ll enjoy a freedom that people living rich will never experience.”

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