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Spend less than you make, invest the rest. Emergency fund, 401k, IRA, HSA. DCA into index funds
Here’s how I’ve always thought about:
1) minimize your fixed costs by not overpaying for housing or cars
2) budget savings and debt retirement to meet your goals
3) THEN think about spending if needed
Ever since I got my first pay raise I’ve rarely had to think about my budget because the big items are taken care of and my spending just fits inside of what’s left. Whenever I try to do a personal budget i quickly get to the realization that I can spend a lot of time and energy trying to squeeze a little bit out of grocery store runs or buying clothes, or I can look for the next investment that would return a lot more benefit.
There’s really only 2 ways to increase savings: earn more and/or spend less — ideally a combo of the two.
Here’s what I’ve done to accelerate my savings:
Train yourself to have a lifestyle that only requires ~20% of your after tax income*. Become less of a frequent consumer — if you buy a lot of materialistic items, buy less frequently and when you do make purchases, make sure they’re high quality goods that’ll last you years.
I’ve adopted a more minimalist approach to life and feel so much better mentally and financially heh.
Good luck 👍🏽
* I live in a LCOL city, no student loans, no debt