It’s no coincidence that so many millionaire entrepreneurs started as average penny-pinchers trying to save their way to financial security. Thrifty spenders are primed to accumulate the money they’re so reluctant to spend because the demands of a frugal lifestyle instill the attitude and habits needed for financial success.
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Some of the richest people in the world built billion-dollar empires yet never let go of the economically prudent ways that guided them before they got rich — but you don’t have to be Warren Buffett for a frugal mindset to pave a path to wealth and security.
GOBankingRates spoke to a self-made millionaire who launched a real estate side hustle that eventually allowed him to quit his job in the corporate world and make more money than he ever could have earning a paycheck from an employer. While the frugal life he lived before he was successful wasn’t always easy, he’s certain it forged the qualities that helped him build a fortune as his own boss.
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A Dedication to Saving Brings an Entrepreneur More Money Than He Can Spend
Chicago-based entrepreneur and self-made millionaire Syed Lateef turned what started as a side hustle in 2017 into a short-term rental and hotel services business with more than 300 units. A former corporate finance industry employee, he estimates his real estate enterprise has earned more than $30 million in revenue during his first seven years in business.
He was not born into wealth and adopted a frugal lifestyle early on out of necessity. He didn’t know back then that by navigating life with saving money at the front of his mind, he was preparing himself for future entrepreneurial success. The frugal habits of stretching his dollars as far as he could and saving as many of them as possible for the rainy days he knew were ahead gave him the skills, discipline, attitude and mental durability needed to turn a side gig into a cash cow.
But while Lateef believes that financial prudence is the secret to success, he insists that frugal doesn’t mean cheap.
“It’s true that frugality is the foundation of wealth-building,” he said. “Still, I’d like to clarify that practicing frugality doesn’t equate to always opting for the cheapest option. Personally, I prefer owning items that are built to last, rather than constantly replacing poorly made ones.”
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A Lifetime of Pursuing Discounts Sculpts a Shrewd Negotiator
Looking back, Lateef concludes that his decades of frugality helped him hone his negotiating skills in business. That’s because budget-minded spenders operate under the assumption that the first price is almost always too high, and that when there’s no room to bargain it down, it’s better to hold out for a better offer.
“Learning to secure better deals has been a part of my millionaire’s journey,” Lateef said. “As I climbed toward millionaire status, even small savings on items or business transactions I could negotiate played a significant role in building my wealth. Negotiation is crucial in business, and mastering this skill was key to my financial success.”
It’s Easy To Establish Priorities When You Only Spend on Things You Need
When you start a business, there’s never enough time or money to go around, which means entrepreneurs can’t afford to lose sight of their most pressing priorities. Here, too, Lateef believes his years of thrifty living nurtured skills that would evolve into business acumen.
“Frugality has taught me about prioritization,” he said. “Prioritization was important because when I was just starting out from scratch, I had to make sacrifices and forgo certain luxuries to save money for the future and for more important goals.”
Like Business, Frugality Demands Rigid Discipline
The frugal mindset requires you to save your pennies even when you have the money to spend excessively. The temptation to spend is everywhere, but by training himself to resist it, Lateef had a much easier time adapting to the ruthless rigors of entrepreneurialism.
“Being frugal helped me become financially disciplined,” he said. “Adhering to specific financial principles to build wealth requires a lot of commitment. Sticking to a budget isn’t always fun or easy, but it’s taught me discipline. Discipline is a fundamental requirement in the world of business, and the discipline I’ve cultivated through frugality has undeniably positioned me for present and future success.”
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This article originally appeared on GOBankingRates.com: I’m a Self-Made Millionaire: How Being Frugal Helped Me Hit My Financial Goals