Living like a millionaire  – without spending a million!

“Don’t buy that $300 bag to have nothing in it, buy that $20 bag and have $280 in it. Don’t go broke trying to look rich.” Warren Buffett

Last Thursday after one of our client meetings I had a post-meeting review session with one of our FALCON senior leaders. We somehow got to the point of „how to live like a millionaire“. I shared couple of ‚growth‘ hacks with him that helped me over the years to save money but still live like a millionaire. I thought it’s time to share some of them with you.

Courtesy to Wolf of Wallstreet,, 4. August 2018

Money: Spend less than you earn

This rule sounds so simple but I have seen couple of people who made a lot of money but haven‘t adjusted their lifestyle when their business/private life went sideways. In one very extreme case, I had (emphasis is on past tense as he screwed a lot of people incl. me) a close friend who made a lot of money but was living — over years — a super extravagant lifestyle. The only problem: his business & lifestyle were not generating any income. So he spent month by month (in fact years) without having a source of income. The moment he realised that he is running short on money he started borrowing it (including borrowing a significant amount of money from myself). Instead of adjusting his lifestyle and admitting that he had a problem he continued living his fabulous life (not to the amusement of friends & family). Long story short: Last week he was officially declared bankrupt owing more than EUR 950,000 (yes, owing not owning). I was totally shocked when I first heard about the figure +1 year ago. But it has cemented my paradigm (which has also been well summarised in the book „Rich Dad. Poor Dad.“) that regardless how much money you make you have to spend less than you earn. Sounds so simple yet most people don‘t follow it. This is how you accumulate wealth over (long) time.

Travel: Be smart with your miles (and your chosen credit card)

One of my biggest savings (without missing the ‚millionaire‘ status) was (a) to move from a typical credit card to one that gives me extra miles if I spend overseas (e.g. Citibank Premiermiles or if you have the little extra $$ on the side: OCBC or BOS Voyage) and (b) to only spend my miles that are between 2–6 hours on (private) economy flights and if it is +6 hours on business with my miles. Emphasis: with my miles. Don‘t spend the $5–10K of super hard earned money on business class. It is not worth it. If you do one thing right: use your miles wisely.

Experience: Invest in experience and not things

One good quote I heard once was ‚let go of the things you fear to loose‘. No, this was not from Dalai Lama or Desmund Tutu (btw: great book to read — The Book of Joy). This was from Yoda of Star Wars. I think it encapsulate something very important: don‘t buy (branded) stuff. And if you buy something branded: be ready to loose it from day 1. Don‘t get me wrong: I LOVE BRANDS (and paradoxically we do a lot of digital branding for our partners :). But don‘t buy (luxury) brands at full price. No one, literally no one will notice whether this Hermes bag is ‚fresh‘ off the shelve or a good-in-shape used bag. The difference? Likely 50–80% off the price. So please think about it 3x before you spend 10x the price of the actual price of the product. Talking about price: Price is not equal to value. Of course, if you value a fresh new Gucci bag highly then your willingness-to-spend is (much) higher. But if you want to live like a millionaire then you don‘t buy branded goods at a full price. Period.

The one thing that I love to spend money on is experience. No, not Instagram. Not the “my life is great and you suck“ kind of experience. I mean to work from or spend time at fancy places. One of my favourite spots are 5-star hotel lobbies. The trick: you have to pretend to be a guest, go to the business lounge (or cafe area) and order something to drink. Yes, your warm tea can be re-filled several times a day. And yes, you can — most of the times — print, scan and even take conference calls for free. Unfortunately, some hotels (e.g. W hotel in Bali) have incorporated a strict pay per use fee. The fall-back trick: get acquainted with the front service-staff. Sometimes (if you smile and have a good one-liner at hand) you will get a discount. Or they „close an eye“ for you. Highly dependent on the situation & mood. The best you can do: be very, very nice.

If you like to work and/or spend time in fancy places, there are some investments you should think of: e.g. you can buy one of the hotel member cards. For instance, the hotel accord card costs you around $350 and includes 1 free stay in their hotels and — this is the best of it — 50% off their F&B bill if you are going for dinner/lunch. It looks professional as you have a nice card (and not a cheap, printed voucher from Groupon) and they treat you as member (and discreetly reduce the bill amount).

Partner: Find an independent partner

Uh….this is a very hard one. And I am sure my girlfriend will hate me for this one but I think it is a paramount point if you want to live like a millionaire (but not spend like a millionaire). Obviously, you love your partner and you do whatever it takes to make him/her happy (see “Brands” above). But something that has helped me very much is to make clear from day 1: „Darling, I am happy to finance our life. But I will not finance your lifestyle.“

What do I mean by that? I was — thanks to my Mum — raised knowing I have to take care of my family. So I do not expect and/or want my partner to work. Especially once we have kids. So I will make sure that we have ‚food on the table‘. But what I will not finance is an abundance of unnecessary spending on luxury bags, watches etc. Yes, I do buy it once in a while for a special occasion. But I will not finance a monthly ‚Chanel‘-bag craving. If my girlfriend wants to buy it more often, she can do it. Anytime. But not from my (hard and painfully accumulated) funds. So if you make this point clear very early on in the relationship (no, not at the first date): you will be able to identify the right partner if you want to live like a millionaire.

Your thoughts: he must be very stingy.

I totally understand and respect if you think that I am stingy. And yes, I agree — the 5-star hotel lobby experience is borderline. But if you ask my friends & family (at least this is what I hope if you ask them), they will confirm that I am very generous. I do donate up to 10% of my generated income on social causes. I do invite my family (occasionally) on family come-together, special trips (Leo, I hope you‘re enjoying New York :)) and other activities (e.g. family holiday which I value very high on my priority list).

But I am trying not to spend on the things that people expect you to spend ‚to look rich‘. I don‘t drive a fancy car (yes, I do rent a nice car 1–2x a year when I am visiting my family. Hint: rent it in Germany not Austria it is 30–40% cheaper but the same car). But I do not pretend and/or have to show off. Personally, I really enjoy going for lunch to our hawker stall next to our office (@Roy: let‘s go there on Tuesday again) or having a healthy fruit breakfast at home. I used to eat 3x a day outside home but I started to value to have at least 1 meal at home. Thanks Roland for the inspiration.

Rent vs. Buy your apartment

This is a tough question too. As my lawyer would say: it depends. It depends if you live in Berlin/Kreuzberg and apartment prices are still (more or less) affordable. Or if you live in Singapore or Hong Kong where real estate prices are incredibly high (and I do not believe that they will have the same growth rates in value that they had from 70‘ — 2000‘). In my case, I do share an apartment with my girlfriend in Vietnam and share one apartment in Singapore with my long-time friend and study colleague Roland. I actually live in a 12 square meter room that fits 1 bed, 1 wardrobe and all my books (I am a little bit nerdy in my leisure time). If I could choose, I would buy an apartment in a metropole with a young, hungry population (e.g. Saigon) but rent a small apartment/room in a city with high apartment/rental prices. In essence: It is not about whether you can afford it, but whether you need it. And no, I don’t need an overpriced apartment in Singapore or Hong Kong.

My last 2 cents. Literally.

In case you make money (for whatever reason) but especially if it is a one-time event (e.g. acquisition, you sell your cryptos or you win in the lottery) I got one really good advise to share from Stefan Glaenzer after my first company got acquired by Google: (1) live the same life as ‚before‘ for the first 6-month after the one-time event and (2) be prepared that your first investment will be your worst.

Obviously, as a 23/24 year old I was listening to him but not following his advise. In my case, I did super unnecessary trips and stuff (no, the weekends in London in „The Box“ or the first fully dressed Hugo Boss outfit, really fully from the socks, to shirts to the jacket and watch were — in retrospect — very unnecessary). I also did my first (and until now worst) investment in a company in Austria. Yes, this is a company that went bust. And yes, this is also the company were I participated at most of the subsequent rounds as there was an (emotional) attachment to it. In retrospect both these lessons have cost me a lot of unnecessary money. And I should have followed the advise of Stefan. But thinking about it, I calm down and refer to my points above: it‘s all about the experience. Isn‘t?

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