5 Surprising Budget Habits of Wealthy Financial Gurus
"He who will not economize will have to agonize," warned Chinese philosopher Confucius as early as the 5th Century B.C. His advice has survived the test of time and has become the mantra of many individuals in their quest for financial success.
However, you would think that once somebody "makes it," it's time to sit back and "treat yourself." Not so fast! Let's review five wealthy financial gurus who continue to save money in the most surprising ways.
1. Warren Buffett eats McDonald's every day for breakfast
With an estimated net worth of over $78 billion, Warren Buffett can definitely afford to sip mimosas for breakfast without sweating the bill. Still, the Oracle of Omaha revealed in a recent 2017 documentary that he sticks to a daily breakfast budget of no more than $3.17 at Mickey D's.
Buffett usually picks up his breakfast from the drive-thru of a nearby McDonald's on his way to the office. "When I'm not feeling quite so prosperous, I might go with the $2.61, which is two sausage patties, and then I put them together and pour myself a Coke," Buffett deadpans. Coke for breakfast, you ask? Buffett's investment company holds over 9 percent of shares from the drink company.
2. T. Boone Pickens owns a pair of shoes from 1957
Through his success in the oil and gas sector, T. Boone Pickens amassed a fortune over the years and ventured into the financing and investment sectors. In 2012, Pickens ranked #913 on Forbes' list of billionaires. Nowadays, he doesn't rank in that list at all because he has given more than $1 billion away through his philanthropic efforts.
Despite his financial success, the author of The First Billion Is the Hardest uses what he buys until it falls apart, which can be several decades later. "If I want something, I look at it, decide what it is, but it will usually be the best product. I've got a pair of loafers that I still wear that I got in 1957," he disclosed during an interview in 2011.
And it's not just shoes, Pickens limits the size of the pieces on his closet in general. "People are always surprised that I don't have a closet full of suits," Pickens told Kiplinger. "I buy three suits every five or so years and only own 10 total. That's all I need."
3. Mitt Romney hunts for cheap flights
While you may know Mitt Romney mostly for being a former presidential candidate, he is also the co-founder of the private equity firm Bain Capital. Through his work as a management consultant and private equity investor, he has a high net worth — estimated at $230 million by Forbes when he ran for office back in 2012.
Not a stranger to the finer things in life, you would expect Romney to stick only with premium buys. While he has purchased six-figure Warmblood horses, he also loves finding bargains. According to The New York Times, he is obsessed with scoring cheap flights on JetBlue. A longtime adviser to Romney supported that claim by stating that, when asked to change a flight, Romney hesitated and responded, "Well, it's a cheap flight. It's a middle seat, but I got a great JetBlue rate."
4. Jack Bogle eats PB&J sandwiches for lunch
One of the few investors with better returns than Warren Buffett is John "Jack" Bogle, founder and retired CEO of the Vanguard Group. If the Vanguard name sounds familiar, it's most likely because you own one of its low-cost index funds in your retirement or investment account. And you wouldn't be alone: Just the Vanguard 500 Index Investor Shares fund [Nasdaq: VFINX] has $292.36 billion in assets as of February 2017!
As the pioneer of low-cost passively managed index funds, Bogle believes that the key to making it big in investments is to aggressively minimize fees. And he sticks by this belief in life as well. Many publications have recounted that his go-to lunch food is peanut butter and jelly sandwiches. He began bringing a PB&J sandwich and an apple when he first started Vanguard because he refused to pay the prices charged in his own cafeteria. And when he does have to order there, he sticks with a simple grilled cheese sandwich.
5. David Cheriton cuts his own hair
A common daydream of individual investors is to uncover the next Microsoft, Facebook, or Apple, become the first one to invest in that moneymaker, and be set for life. Stanford professor David Cheriton happens to be one of those investors that hit the jackpot when in 1998, he wrote a check for $100,000 to Google founders Larry Page and Sergey Brin. Today, that investment makes up the bulk of his estimated $4.2 billion net worth.
As of 2012, the "Billionaire Professor" had invested over $50 million across 17 startups and companies, and continues to invest. To this day, he continues to plunk down checks in several other companies, such as AISense and ThreatSTOP.
With such an investing pedigree, you would think that he wouldn't mind splurging a bit on a nice haircut once a month. For over three decades, Cheriton prefers to cut his hair himself. "It's not that I can't fathom a haircut," said Cheriton. "It's just easy to do myself, and it takes less time," he confessed to Forbes. Since the professor is adept at making good calls, probably nobody would argue with him on this one.
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