If you suddenly were making a lot of money (nothing crazy, say 100k a year) would you try to live wealthy or would you not change much from how you live now?
For example: If you make 50k a year now and use 45k so you have 5k savings, would you still spend around 45 to 50k a year even if you made 100k? That way you would have huge savings since you are living like you’re “poorer” than you really are.
For those of you that are pretty wealthy already, how do you budget your money? Do you “live up to your income” or do you live like somebody who makes much less?
From my experience and observations, I think that those wealthy people normally have this problem of not knowing how to save and spend because of having excess money at their disposal. This sometimes puts them into sudden and unexpected debt but their financial power is equal to the task. With just one call to their account officer, and everything would be sorted out.
But when it comes to myself, I live, spend and save according to my income because there is no tree which I pluck money from. Should I be extravagant with spending, I’m still going to be the one to suffer for it because have no body to aid me should I find myself in a tight corner.