Money lessons you can learn from frugal celebrities

By Personal FinanceFOXBusiness

Who topped the list of the highest paid celebrities?

FBN's Susan Li on Forbes' ranking of the highest paid celebrities.

Champagne wishes and caviar dreams aren't on the minds of every celebrity. In the lifestyles of the rich and famous, some celebrities are more focused on coupons and cost savings.

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“Unfortunately we hear a lot of the salacious stories about over spending by celebrities, but I think there’s a lot of really good skills that we can learn from them,” says Christopher Tracy, president of financial wellness at Mvelopes. “Regardless of the income level, good money management habits are crucial to success at every income bracket - whether you have a seven figure salary or you are just scraping by.”

Tracy says there are four key areas to watch in the lifestyles of the rich and frugal: how celebrities save, how they spend, their borrowing habits/debt levels and how they plan.

Warren Buffett

Warren Buffett, chairman of Berkshire Hathaway and one of the world's richest men, still lives in the home he bought in 1958 for $31,000. In the HBO documentary, “Becoming Warren Buffett,” the billionaire said on most days he never spends more than $3.17 on his daily breakfast at McDonald's.

What you can learn:

“When your income increases, your spending should not,” says Tracy. “When you can keep your expenses in check even as your income grows, that’s going to set you up for success later on. Whether that’s saving for retirement or the kids’ college tuition.”

Gwyneth Paltrow

Gwyneth Paltrow may have started her career as an actress; but she is now a successful businesswoman and owner of the lifestyle company Goop. While she has the funds to hire a world-class interior designer, Paltrow said on Goop.com that twice she attempted to redesign her living room on her own.  

What you can learn:

“Don’t outsource tasks you can easily do yourself,” Tracy says. “When you look for opportunities to manage those types of tasks yourself, you will reduce expenses and save a lot more money.”

Leonardo DiCaprio

Actor Leonardo DiCaprio is well-known for starring in films such as “Inception,” “The Revenant,” and “Titanic” – one of the highest grossing films of all time. While some celebrities overspend on their vehicles, the Oscar-winning actor is known to drive a Toyota Prius.

What you can learn:

“When you do that, you can save a lot of money in terms of the overall expense,” Tracy says. “You may also qualify for some tax credits. Save money on your ongoing expenses through less gas consumption, but also do something good for the environment.”

Jennifer Lawrence

Jennifer Lawrence, star of the popular “Hunger Games” franchise, was ranked Forbes Magazine’s highest paid actress in 2015 and 2016. The actress lives a thrifty lifestyle and told the U.K. magazine Fabulous she prefers to clip coupons.

What you can learn:

“In today’s economy, you don’t necessarily have to be clipping paper coupons,” says Tracy. “There are a lot of apps where you can get digital coupons. That makes it easier than ever to save money on the purchases you are making.”

Ed Sheeran

Ed Sheeran, the musician behind hits including “Thinking Out Loud” and “Shape of You,” ranked ninth in Forbes Magazine’s 2018 list of the top 100 highest paid entertainers. Sheeran said in an interview with the Irish Examiner that he doesn’t spend much money and gives himself a monthly allowance. 

What you can learn:

“If you don’t want to get into the details of a budget, giving yourself an allowance is a great way to manage your overall expenses,” Tracy says. “We love to see when someone gives themselves a tight allowance in comparison to their income.”

Kristen Bell

Actress Kristen Bell was the voice of Princess Anna in “Frozen” -  the highest grossing animated film on record. In an interview on “Jimmy Kimmel Live,” Bell said she spent only $142 on her marriage to actor Dax Shepard.

What you can learn:

“We see far too many examples where we feel pressure to spend more on special events,” Tracy says. “The reality is, there’s a lot more you can do to celebrate the occasion and spend less. Kristen represents that very well by focusing on the occasion and not overspending on that type of activity.”

Keira Knightley

English actress Keira Knightley is well-known for playing Elizabeth Swann in the highly successful “Pirates of the Caribbean” franchise. Glamour Magazine reported that Knightley said she restricts herself to a yearly allowance of $50,000 a year. Subsequently in an interview with TIME, Knightley said while $50,000 is a good amount of money to live on, she does not survive off that amount. Nevertheless, Tracy says there are two important lessons we all can use.

What you can learn:

“One - is setting an annual budget,” he says. “The idea of planning really helps set you off on a better course in your financial health. Two – is when you can maintain a budget that is far less than your income, you are able to set aside a good portion of that for other goals – whether it be savings, investments or other activities.”

“Our habits are going to dictate our financial wealth,” Tracy adds. “There are a lot of things you can learn from celebrities. They don’t have to be big items or big changes.” 

Linda Bell joined FOX Business Network (FBN) in 2014 as an assignment editor. She is an award-winning writer of business and financial content.  You can follow her on Twitter @lindanbell