Some think that you have to fake it to make it… and in some ways this is true.

But I think it’s also true that less is more when it comes to accumulating wealth while having an average salary.

Whenever a person moves up in their salary amount, or their rate of pay, they start to think that they have made it. They start to buy more expensive things because they believe that they are supposed to.

But the way to build wealth while on a modest income is by practicing the less is more concept!

The “less is more” concept in a nutshell is that the less you spend, the more you get to save for wealth building activities!

Here are the ways that you get ahead by following the Less is More idea:

1. Less House!  It’s true, that housing has traditionally been a great way to acquire wealth (excluding the past few years).  But along with a big fancy house, comes big expenses!  With a larger house you will pay
   1. More in Real Estate Taxes (unless you are outside of city limits, or in a state that doesn’t tax Real Estate).
   2. More on your utilities (gas, electric, water, sewage)
   3. More for repairs to your appliances and house (roof shingles, heaters, water pumps, etc).
   4. More on landscaping (after all you have to keep up with the Joneses, if you live in a big house).
   5. More on Cosmetic features (faux paint, fancy decorations, artwork, etc)
   6. House cleaning…
2. Less Car!  If you buy a decent dependable car instead of a luxury car, you’ll save money instead of spending more!
   1. Insurance will be less for a cheaper dependable car.
   2. Surprisingly, luxury cars break down more than the reliable cars reviewed in Consumer Report Magazine.
   3. Auto Repairs will be more expensive, or auto mechanics will charge you more because they know you can afford it.
   4. It’s more apt to be stolen.
3. Less on Eating out and Living Large!
   1. Eating out more (especially drinking alcohol), is a quick drain of money!
   2. Buying Football (and other sport) tickets!  Nothing waste money quicker than spending hundreds of dollars for sporting events.
   3. Fancy vacations!  There have been years where my family had to vacationed in backyardsville, so that we could get our finances stable.
4. Less on Electronics!
   1. Skip the newest smart phone when it comes out (iPhone anyone)!  At first, they are typically overpriced.  Some people toss their current phone and run out to get the newest electronic gizmo!  As someone in the technology field, I understand the temptation!  But if I can do it, then so can you!
   2. Once you buy a product stick with it!  I keep my computer at least 5 years!  Once we buy our newest TV (with credit card reward points money), we’ll keep it until it breaks down.
   3. Don’t stick to brand names!  Believe it or not, an Apple IPod is still just an MP3 player…  I know I can buy an MP3 player for a much cheaper price!

These are just some of the ways that you can apply the Less is More idea to save more money which could then be used for investment, or paying off debt!

Readers, did I miss any other big “Less is More” item?

-MR