The Importance of Saving A little bit of money can go a long way

What does it mean to be frugal? Sparing or economical with regard to money Simple and plain and costing little “Cheap”

Why should you be frugal? Being frugal does not mean that you can’t enjoy the things you still do Don’t have to buy generic/store brand over name brand Just know that these expenses add up over time Can still enjoy same luxuries, just not in as high of frequency Ex: don’t have to eat McDonald's every day after school Opportunity costs “Would I rather have this now or have more money later?”

Frugality in Action Instead of going out for dinner with friends, you stay in an share some pizzas with them and split the costs Hypothetically this saves you ~$40/week $40/week x 52 weeks= $2000/year If you invest the money you save, assuming a compounded return of 8% over the course of 40 years, that $40 weekly savings will reward you with $581,944!

Frugality in Action II “Casual” Starbucks user spends on average $4/day This will cost ~$56,000 worth of savings over 20 years at 6% interest Starbucks “loyalist” spends around $10/day Drinking away $141,250 in savings over 20 years Frugality Application Don’t have to drink Starbucks every day—make it a special occasion Make your own coffee at home

Frugality in Action III Smartwater Spend ~$150/month on water ($1800/year) At 8% compounded over 40 years, that’s $503,605 lost Frugality Application Instead of buying water bottles, you can get your water for free from your sink or a Brita water filter

The Earlier You Start, The More You’ll End With (Assuming 10% Annual Return) Daily Investment Monthly Investment 10 Years 20 Years 30 Years 40 Years 50 Years $5 $150 $30,727 $113,905 $339,073 $948,612 $2,598,659 $10 $300 $61,453 $227,822 $678,146 $1,897,224 $5,197,317 $15 $450 $92,180 $341,716 $1,017,220 $2,845,836 $7,795,976 $20 $600 $122,907 $455,621 $1,356,293 $3,794,448 $10,394,634 $30 $900 $184,360 $683,432 $2,034,439 $5,691,672 $15,591,952 $40 $1,200 $245,814 $911,243 $2,712,586 $7,588,895 $20,789,269 $50 $1,500 $307,267 $1,139,053 $3,390,732 $9,486,119 $25,986,586

The Tale of Two Brothers: William and James William opened a retirement account at 20 and invested $4,000/year for the next 20 years At age 40, he stopped funding the account but let it grow tax-free at 10% each year James didn’t start saving until he was 40 and invested $4,000/year for the next 25 years William saved $80,000 ($4,000/year X 20 years @ 10%) while James saved $100,000 ($4,000/year X 25 years @10%) By the time they both retired at age 65, William ended up with $2.5 million even though he stopped saving before his brother even started saving, while James had under $400,000… a gap of over $2 million!

Start Saving Early!

Source Money: Master the Game by Tony Robbins Pick it up for $15.00 on Amazon!