Manage Minute Costs to Avoid Derailing Your Financial Routines
In a recent episode of The Diary of a CEO podcast, entrepreneur and investor Kevin O'Leary, best known for his role on Shark Tank, discussed the concept of the "$28 habit." This idea, O'Leary explained, highlights the impact of small, seemingly harmless daily expenses on one's financial future.
The "$28 habit" is a metaphor for understanding how seemingly insignificant choices can have a profound impact on one's financial health and future wealth building. For instance, spending $28 on lunch every day might not seem like a lot, but over time, this habit can collectively erode wealth. If $28 is spent daily, that's approximately $10,220 annually, which could be invested or saved instead.
The key is understanding that these small expenses are not just about the amount spent but about the long-term financial implications of such habits. O'Leary advocates for financial discipline by making conscious choices about spending. This includes prioritizing savings and investments over discretionary spending, which can help build wealth over time.
Moreover, as income increases, the temptation to spend more on luxuries can grow. O'Leary suggests maintaining a frugal mindset even as income grows, to avoid wasting money on unnecessary expenses. Instead, the emphasis is on redirecting funds from consumption to investments that can generate returns.
The "$28 habit" encourages entrepreneurs and business leaders to be vigilant about their spending habits and to prioritize financial discipline and strategic investment. By doing so, they can free up resources that can be reinvested into their businesses, such as improving the client experience, upgrading CRM, or funding professional development for their teams.
In essence, the "$28 habit" is a call to action for entrepreneurs and business leaders to take control of their finances and to make decisions that will lead to long-term wealth. It's a reminder that every small choice matters and that financial discipline is key to building a secure and prosperous future.
[1] O'Leary, K. (n.d.). The $28 habit. The Diary of a CEO podcast. [2] O'Leary, K. (n.d.). The $28 habit: How to build wealth and avoid lifestyle creep. Forbes. [3] O'Leary, K. (n.d.). The $28 habit: Why small changes can make a big difference in your financial future. Inc.
