Please join me in wishing Ingvar Kamprad a slightly belated happy birthday. He turned 80 on March 30.
You know who Ingvar Kamprad is, right? Well, actually, there's a good chance that you don't. But you should. His initials form the first half of his famous company's name -- IKEA. You know, the Sweden-based international home-furnishing powerhouse? And I do mean powerhouse. It's the world's biggest furniture retailer, with more than 200 stores in more than 30 countries, including Saudi Arabia, the U.A.E., Malaysia, Slovakia, China, and France. There are 27 stores in the U.S. at the moment, with several more on the way.
I'm a fan of the well-designed, affordable wares and wish I were a shareholder, but alas, the company is privately held -- by Mr. Kamprad. He's the world's fourth-richest man, thanks to his booming business. So as the firm rakes in billions in sales, Kamprad holds the profits. Is he therefore tooling around town in a top-of-the-line 2006 Saab, or enjoying caviar on his private jet? Not exactly. You see, the guy's ... er ... what you might call frugal.
According to a Reuters article, Kamprad drives a 15-year-old Volvo and flies economy class. His rationale should inform us as investors and inspire us as consumers. Kamprad believes in avoiding waste. His employees are encouraged to write on both sides of a sheet of paper. He explains that every bit of money saved can be used to grow the company, as it expands into China, Russia, and elsewhere. So being frugal is not a pointless, petty endeavor, but instead an extremely valuable practice.
As I pointed out in an earlier article, "I'll Never Be Rich," it often takes a certain frugal mind-set to help someone achieve wealth. Millionaire-next-door stories confirm this. We would do well to examine our own lives and see where we might be able to spend less and save and invest more.
Interestingly, there are lots of companies that can help you live a more frugal life. IKEA is one of them; it offers items such as $200 sofas and even tries to lower its prices each year. There are plenty of public companies, too, that help. For example, if you shop more at Safeway and make more meals at home, you can save a lot by not eating in restaurants. If you buy a very fuel-efficient car, such as a Toyota (NYSE:TM) Corolla, you'll experience fewer crying jags at the gas pump. Go to Funagain.com and buy a few board games, and you'll likely prevent yourself from wasting money on bad movies at your local googol-plex. Check out the coffee at your local mom-and-pop deli -- it may taste better than Starbucks (NASDAQ:SBUX) coffee and probably cost you less, to say nothing of supporting local small businesses.
You can even save money while investing. Spend a few minutes in our Broker Center, and you may find a brokerage that will serve your needs better and cost you less than your current brokerage. Indeed, some very reputable brokerages now charge commissions of $5 or less per trade. (Our comparison table may be particularly helpful.) You might also want to poke through the websites of some contenders for your investing business, such as Fidelity, Ameritrade (Nasdaq AMTD), E*Trade (NYSE:ET), and Schwab (NASDAQ:SCHW).
Here's to a frugal, but rich, life!
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Longtime Fool contributor Selena Maranjian does not own shares of any companies mentioned in this article.
