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Millionaire minimalists

Based on an article I read recently in the Seattle Times, it sounds like some of Silicon Valley’s young tech phenoms aren’t spending their millions on sexy fast cars or big houses.   In fact, a few of these multi-millionaire hot shots live rather modestly and frugally, in one or two-bedroom condominiums and get $12 haircuts.

Take for example, Aaron Patzer, founder of Mint.com

Aaron lives in a 600-square-foot, one-bedroom apartment in Palo Alto.  The article I read said he drove a 1996 Ford Contour until it wouldn’t run anymore.  (Geez, and I was proud of my 11-year-old car!)  That’s extremely frugal for a guy who sold his internet startup called Mint.com for $170 million in 2009.

Another example is Dustin Moskovitz, the world’s youngest billionaire according to Forbes this past March.  The Facebook co-founder could likely afford any house on the planet but the billionaire bought a rather modest $800,000 condo to live in.  Apparently he also flies coach when he travels.

Pretty interesting stuff - some of the world’s richest young men are also comparatively very frugal.

I wonder if they’ve taken a page from previous generations?

For example:

Forget billionaires for a second though.  If you were a millionaire or if you’re an aspiring one, would you lead a minimalist lifestyle?

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20 Responses to "Millionaire minimalists"

  1. Great article. It’s inspiring to see people who have much better means than I do also living frugally.

    I go back and forth on this one. I don’t think there is ever reason to waste. I don’t need more than one home, and I don’t need 15 bedrooms in the one house I would own either. I don’t need five cars and I don’t particularly like fancy food. Because of that, even if I was uber-rich, I doubt I would live excessively. If I was a multi-millionaire, I doubt I would still be living car-free however. I would have a car, and probably drive a fairly decent one. I would also own a decent sized home/condo..maybe around 2,000 square feet?

    My point is that I think balance is necessary on both sides of the aisle. There is no sense living like a pauper if you don’t have to…and I don’t think living like a king when there is no additional benefit to it is a good idea either. I will likely always live far below my means as I’ve found some inner peace to it. Once you are done chasing things (fancy cars, meals and clothes, etc.) you find that there is a lot more to life! Constantly chasing MORE will lead you to a never-ending journey…with no true reward in sight. Once you stop and look around and realize you’ve found happiness…then you can concentrate on more important things.

    Ever-increasing material objects do not provide ever-increasing happiness, but again it’s all about balance. Once you have a decent roof over your head, some food in your belly and you can spend time with the people you care about…then what else do you really need? A giant yacht and a private driver??? I guarantee you would only find emptiness with such things. More does not always mean better.

    • @Mantra,

      I like that comment: there are no good reasons for waste. If I was a millionaire, I hope I wouldn’t live much differently than I do now. I just wouldn’t have to work at my current job! :)

      I hope I always live below my means. Right now, it doesn’t feel that way; our debt load is higher than I would like so a couple more years of aggressive debt reduction, and I’ll feel much, much better. Having our LOC paid off will be a HUGE piece of mind.

      I’m of the mind-set that MORE does not mean BETTER. There are SO MANY more important things in life than accumulating things.

      Thanks for your detailed contribution!

  2. First off, I want to make it clear to everyone that I was actually Tweeting some of your posts even before you joined Twitter :) Welcome to the club…don’t get too addicted!

    You must be a mind reader because I’ve also been writing about millionaires and some of the common characteristics that are prominent among the rich.

    To answer to your question, I live in a regular bungalow (nothing fancy) and my wife and I live a frugal lifestyle. We are always seeking deals (coupon clipping and grocery pamphlets are common) and monitoring spending is a high priority. We try to redeem rewards points to fly while vacationing and luxury items are not high priorities. I drink beer and wine rather than expensive liquor. I don’t buy designer clothes.

    Nice post!

    • @TWC,

      Thanks, I think I’m going to like Twitter!

      Even if you’re a “wealthy Canadian”, I think it’s GREAT you live far below your means. Who needs excess? Excess is wasteful and wasteful is not good.

      Having or owning material goods “just because you can” is not a good enough reason. Material goods are all relative – relative to other people that is :)

      Being a millionaire, I think, offers financial freedom and choice to do what you want with your time not buy what you want with your time. I hope to get there someday!

  3. Elemag says:

    I think you already know my answer, Mark! If I was very rich (like if I won the lottery or something), I would still remain frugal and opposed to wasteful existence. I will keep one of my jobs, and spend a lot more time with my family. We will travel locally and internationally but in moderation. We will also take better care of ourselves, meaning more aikido (for me), swimming, soccer, table tennis (an excellent game or your brain), massage therapies and trips to the spa (for my better half who totally deseves it) but nothing too extravagant.

    Have a great short work week!

    • @Elemag,

      You’re right, I do know the answer, but I’m glad you wrote back all the same!

      You have such a great outlook on life: using your financial freedom to spend a lot more time with family; travel a little, more time to exercise and live a balanced life. I would also try to do all those things. I guess that’s what it’s all about – balance, like others have said. A balance between utlizing resources, time included, effectively and not being wasteful.

      I commend these young tech phenoms for living like this. They certainly don’t have to but are choosing to.

  4. Warren Buffett still lives in the same house he bought in 1957 for $31,500, and for years he drove around in a Ford Town Car with the license plate reading “THRIFTY”. In 2006 he finally upgraded to a Cadillac DTS. :)

  5. I love the example Simply Investing! I am a huge Buffett fan as well. Cutting your own hair goes a bit far for me however? Why not just pay a decent barber to have a standing 3 week apointment to come to your house, or however often you want to make it.

  6. MOA great post man! OK enough thrifty already guys! Life’s a balance, right?

    It’s good to be frugal (to a point). You can’t be a succesful investor if you can’t manage your money – the two go hand in hand. Susan P. Brunner made that point so well in her interviews with me.

    But really, do I want to eat tuna-fish sandwiches all week, wash my coffee filters every time I use them, or wear the same underwear for a week to save on laundry soap? Is an extra $10 per month worth my sanity? DO I not go out for dinner because I’m cheap? I don’t think so. On the other hand I don’t go out of my way to buy things I don’t need or spend money frivously… that’s for sure.

    Hmmm… Isn’t accumulating stocks and ETFs is still accumulating things? SO…. isn’t money meant to be enjoyed as well as invested?

    if I have $370 million in the bank, am I really going to drive a clunker? probably not. Until then, my employer gives me a discount bus-pass and I save hundreds of dollars per month – that makes me happy! Investing at this point is more importatn to me than a nice car, or whatever for that matter, and to me has more future benefit to my well being. But there will be a point where I want to enjoy the fruits of my labour as well!

    Cheers
    The Dividend Ninja

  7. I would not live as frugally as these particular guys. I would enjoy it, but in some ways I don’t like I would change my lifestyle. I’m fine in my condo and could be fine even with 50 million, but I’d probably buy a nice expensive car and take more trips and stuff like that. I don’t need to fly first class but coach? Forget it… too many painful memories of being crammed in like a sardine! ;)

  8. Wow, I’m surprised! Aaron (Mint.com) is pretty hot!

    If I made a few hundred million, I would live somewhere with more space (600sq ft doesnt’ cut it for me lol).

    Cool, great post- I wikipedia’d all the facebook cofounders to see what they look like.

    • @Y&T,

      Ha, the hot comment about Aaron. I would definitely have a nice house and a nice ride if I have a few hundred million, but nothing WAY over the top. Just not my style ;)

      Are you on the hunt for a multi-million dollar man? Maybe Aaron has a Twitter account?!

      Cheers!

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