Why the Things You Skip Today Shape Your Financial Freedom Tomorrow

A minimalist scene featuring a closed leather wallet placed on a business book, symbolizing financial restraint and the wealth found in things not purchased.

We often assume, “That person must be rich—they drive a nice car and wear an expensive watch.” But one of the core messages from The Psychology of Money flips that idea entirely: real wealth is what you don’t see—what you didn’t spend.

According to the Federal Reserve, the median savings balance for U.S. households in 2023 was just $5,300. A Bankrate survey that same year found that 60% of millennials spent most of their paycheck within days of receiving it. Their savings rate hovered around 7%. In other words, looking rich and being financially secure are two very different things.

I learned this lesson the hard way. Early in my career, I spent money trying to fit in—designer sneakers, the latest phone, trips that looked good on Instagram. But behind the scenes, my bank account was always on edge. I was just surviving paycheck to paycheck. One day I finally asked myself: How much real wealth am I sacrificing just to look wealthy?

That question changed everything. I stopped spending to impress and started pausing before every purchase. Instead of asking, “Do I need this?” I began asking, “What could I gain by not buying this?” That mindset helped me reroute my money: I set up automatic transfers to a high-yield savings account, and I started investing monthly in the S&P 500 ETF through Charles Schwab. I reinvest all dividends automatically. The shift was gradual, but over time, my financial life became more stable—and more free.

Morgan Housel says, “Wealth is what you don’t see. It’s the income you haven’t spent.” A luxury car is money that’s already gone. A quiet bank account, by contrast, holds untapped opportunity.

Harvard Business Review backs this up: a study found that among individuals with similar incomes, those who practiced restrained spending built twice the net worth of those who didn’t. In other words, wealth often comes more from self-control than from salary.

This shift in mindset is growing among Gen Z as well. According to CNBC, more than one-third of Americans in their 20s now believe that minimalist spending habits are more effective for long-term wealth building than higher income. It’s not just a trend—it’s a survival strategy.

I still spend on things I enjoy. But now, I always weigh my purchases against the freedom I might be giving up. What I don’t buy often matters more than what I do. Every year, I even set a personal “flex budget” for guilt-free indulgence. This year, it’s $2,000. As long as I stay within that boundary, I can enjoy life without financial anxiety—and without sabotaging my system.

So ask yourself: what are you choosing not to buy today, and how might that choice expand your options tomorrow? Real wealth may just begin with the power to walk away.

This blog post is inspired by key ideas from The Psychology of Money, reinterpreted through the author's personal lens. No direct quotes are used. All rights belong to the original author.