Okay, so the title “why I live as a poor person” probably brought you to this page, but there is a deep reason why I choose to live more frugally. Moving to more intention value-based spending is my main goal.
This blog will explore my reasons for going down the path of frugality. I will also address the deep reasons why I have gone down this path, as well the things that I am actually willing to spend money on.
Why did I decide to live like a poor person?
About nine years back, I was in my early twenties, feeling like I was sitting pretty on the financial front. I had been working in Korea, and the whole money versus cost-of-living situation was favourable.
In Korea, I had my accommodation and many other expenses paid for by the company. Furthermore, even eating out would end up pretty cheap. I wasn’t by any means a luxurious spender back then, but there were certain things that would definitely catch my eye. These chiefly included camera gear and alcohol. I would spend a few thousand a year on both of these. Impulse buying became a real habit.
When I came back to the UK, I soon realised that I was spending far more than I was saving. I was so used to having everything cheap that the London prices were a wake-up call. I even got into my overdraft, which is something I have not let happen since this time.
What led me to prioritise purpose over possessions?
At first, cutting back was more of a necessity.
As I became more interested in building my personal wealth, I knew that I had start investing and saving more. Something that really gave my frugality purpose was thinking about everything in terms of the future.
Rather than focusing on possessing the greatest and best camera gear, I decided that it was best to make do with what I had. I started to live like a poor person.
It took me a while to develop my knowledge to a point where I was comfortable investing, but I had already made the decision to be focused on this part of my life.
Making Commitments to Yourself
Making that commitment to myself was why I was able to become so resolved to continue down this path.
You may struggle to make that commitment to yourself, but try to observe yourself and how you make decisions. Do you need to write down your commitments to keep them? Do you need to actively avoid the places that discourage you from following your commitments?
I found that, at first, I had to go on a sort of “cold turkey”, avoiding places where I was likely to drink or buy expensive camera gear. I even avoided watching photography YouTube channels as I would find myself enticed by the latest gear.
The Philosophy of Minimalism
Unknowingly at the time, I was embarking towards a life of minimalism.
As a philosophy, minimalism as a movement has its roots in the 1950s through to the 1970s in the artistic realm. Frank Stella, the abstract painter paint his Black Series in the 1950s, which was a series of black lithographs that utilised simple geometric patterns to great effect.
Like most philosophies, the movement would not only catch fire in the artistic realm but would expand into areas of everyday life. Minimalism as a lifestyle would start to gain popularity in the late 2000s.
Experts have pointed to the financial crisis of 2008 as having a significant impact on this transformation in mindset. The decadence of wall street and the greed of the big banks turned people against the rampant consumerism which had taken root. In fact, part of the reason why I left London, is because I realised that the big city life was in conflict with my ideals of minimalism.
Does minimalism really make us more content?
In order to answer this question, I believe that we need to think about the deep-rooted reason for accumulation. Why do we often feel that we need so much stuff?
The statistics on this are shocking. Children in the UK have on average, 493 toys by the age of 13. The average American home has 300,000 items. Women spend on average, 8 years of their lives shopping. The average monthly spend on clothes per month in the UK is around £80.
So, why do we do it? It doesn’t seem to make sense initially, but on closer inspection, it is clear that accumulation is a very human quality.
Why does the squirrel hoard more nuts than it could ever need for winter? Funnily enough, the reason why we hoard seems fundamentally linked to our survival.
Our ancestors would have spent their days in fear that there would suddenly be an inability to obtain food. It would have been rational to accumulate while there was supply. This probably would have involved killing 10 mammoths and storing the meat, instead of just one that we needed at the time.
Is Excessive Accumulation a Danger in Modern Times?
In the modern world, however, this need to accumulate can be really detrimental and is viewed as a psychological issue when taken to extremes. Watch Hoarders if you’re fascinated by how this can spiral into a real problem.
For almost the first time in human history, people in most of the developed Western world, and even parts outside, can enjoy a world of abundance. Our minds, having evolved to expect scarcity, are constantly bombarded by stimuli.
Find out about how I plan to minimise my need for stimuli in 2024.
For a long span of human history, this scarcity mindset may have saved our lives, but now, it is probably not the right way to approach life.
Consumerism to Improve Our Self-Esteem
Although this may seem like a jump, I believe that this natural tendency to fear that everything may disappear at any moment leads to us developing a scarcity mindset in all aspects of life.
According to Belk, writing in the Journal of Consumer Research, “Our possessions are a major contributor to and reflection of our identities.” If we truly exist in a mode of scarcity, where we believe that we lack physical goods, then we will believe ourselves to be lacking as individuals. In other words, we will deem ourselves to be worthless, and we will naturally feel ashamed.
I am someone who owns a business and thinks about businesses when I am making investments. Therefore, it is understand the importance of brand value, I understand that possessions evoke feelings within us.
For instance, an iPhone certainly has a practical value: we make phone calls with it, we can access the internet, we can find our way using it, etc. However, it also holds a special status in our minds. We see Apple as a symbol of “success and prestige”, “style”, “innovation”, etc.
This brand value problem makes it challenging for us to break free. I want to be successful, stylish and open to innovation! Can we be our authentic self if we are buying our persona?
Why have Money in the First Place?
Some people ask me, why have money if you’re not going to spend it?
This question is one that I often reflect upon and struggle a bit with. Obviously, money allows us to keep us at the level of subsistence, but what do we do with the excess?
Well, if we do spend money, I think it’s helpful to regard things with utility. Do we need it? How will this purchase make my life easier?
Always do a quality check. Having a brand name does not necessarily mean that it is the best quality. Think about sunglasses for instance where Luxottica basically is the monopolistic producer of all the sunglasses.
Is a Gucci pair of sunglasses built to the same quality as a Ray-Ban pair even though they may cost double?
Why are you buying an item? Is it because everyone else seems to have it? If it’s for this reason then you are a sheep who will fall for every fad.
Analyse your deep reasons for why you desire something.
Poor Person Mentality?
The idea of adopting a “poverty mindset” among wealthy individuals doesn’t mean fully embracing the struggles and limitations faced by those living in poverty. It’s more about steering away from excess and embracing a mindset of humility and financial prudence.
When we say “live like a poor person,” we’re not talking about adopting the stress or struggles of financial hardship. Instead, it’s about incorporating the values often associated with a more humble lifestyle. Living humbly means making conscious choices, avoiding unnecessary extravagance, and not letting your lifestyle outpace your financial reality. Sticking to a budget also helps!
Contrary to the stereotype, living like a poor person isn’t about seeking immediate gratification or chasing after temporary highs like the dopamine rush from buying luxury goods or indulging in excesses. It’s about appreciating the value of lasting contentment over fleeting pleasures. While some living in poverty might be driven by the need for instant satisfaction, adopting a humble lifestyle emphasises the wisdom of making thoughtful, long-term choices that contribute to overall well-being.
In essence, it’s a call to live authentically, appreciating what you have, and making intentional decisions that align with your values and financial capacity. It’s not about mimicking a state of lack but rather about finding a balance between enjoying life and being responsible with your resources. Even I make an effort to take care of my mind and body!
Conclusion: The Poor Person Paradigm
Living like a poor person, if understood as taking the philosophy of minimalism, may actually help you build wealth. More importantly, it can teach you self-control and even help you actualise yourself.
There is much left of my journey and many things for me to learn and improve. I am learning, like you, more about how modes of thinking and mental models can transform our lives for the better. Thanks for reading, and see you next time.
