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Daily Decisions can make a HUGE impact!
| Expense | Cost per month | If invested in interest bearing mutual fund from 16-76 * |
| 1 Jcrew shirt | $90 | $11,622,000 |
| 2 pair of shoes on sale | $150 | $19,371,943 |
| 1 Anthropologie dress | $160 | $20,663,319 |
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You may say these are extreme examples of saving from a young age, and you are already 40. So let’s take a more conservative approach. For example, a 40 year old just starting to save could put $150 a month (the cost of one Anthropologie dress) into an interest bearing mutual fund* for the next 35 years and at retirement have $974,290 – or almost a MILLION dollars!!!
I took the cost of an outfit I recently saw on Polyvore – total of outfit $276. Invested monthly in a mutual fund* starting at 40 until retirement will bring $1,792,694. So the decision is ours - closet full of clothing that we tire of, give away, donate to Goodwill, constantly replenish or almost $2 million in cash........hmmmmmm.................
This stuff blows my mind! I write this as I am thinking about life and expenses and what I want over the long haul. It's true you may be able to save money and still buy whatever you want each month. It's all relative and it's all very personal. Everyone has to find that balance. Of course in this life we want to have fun and enjoy things! I am just trying to bring to mind a different way to look at things and become more mindful of how my daily decisions influence the big picture. I am also mindful that I am a steward of God's blessings and no money is really "mine" but entrusted to me to manage in this life.
Let me also say that there are many ways to go about managing finances. I really have a hard time reading budget books that say I have to wash out my Ziploc bags and line dry all my laundry- I'm not going to do it. But that works for some people. I love reading Money Saving Mom about how they have saved cash to buy a house! They will have no debt at all! It works for them. I also know people (like my boss) who are already multi-millionaires and have become so by using the OPM (other people's money) method and creative financing. It works for them! There are many ways to financial success!
If you want to do some "number crunching" of your own, based on your actual expenses there is a great calculator HERE. Go through your receipts or credit card statements from the last few months to get a true and clear picture of what you are actually spending on clothing for yourself. Put that number into the calculator, choose 12% as the rate of return (because over the long haul, that is typically what a good mutual fund return is) and you can play with the number of years you have to work with, etc. You may have it within your power to become a millionaire!
*I am using 12% rate of return on the mutual fund scenarios as Dave Ramsey does in his books. He said in the videos, even though the market is currently down, that over the long haul good mutual funds typically return at 12%.




