Why you should live below your means

The ability to live with less is one of the most powerful financial levers because you’ll have more control over it than things like your income or investment returns.

The person who makes $40,000 per year, but only needs $30,000 to be happy, is richer than the person who makes $400,000 but needs $400,000 to be happy. The investor who earns a 3% return, but has low expenses, may be better off than the investor who earns 10% a year but needs to spend all gains.

How much you make doesn’t determine how much you have, and how much you have doesn’t determine how much you need.