Frugal Habits of the Millionaire Next Door

To call Dan Nainan frugal is an understatement. He lives in New York City, home to the worlds largest public transit system, but insists on walking. Everywhere. Sometimes for miles on end. When he travels he prefers to couch-surf, and dont be fooled if you see him at Starbucks. Hes not ordering any lattes. He just stays for the free Wi-Fi.

Oh, and did I mention hes a millionaire?

There are two ways to become a millionaire. You either make a lot of money or be a frugal person, says Nainan. Ive kind of combined those.

Also see: Daily Habits of the Wealthy

In fact the 32-year-old has managed to save a whopping $1.6 million nest egg despite quitting his day job as a software developer five years ago to pursue stand-up comedy. He says what began as a hobby now earns him tens of thousands of dollars per appearance money that mostly goes to savings.

Also see: When It Pays to Quit Your Job

In my business, you never know when the phone will stop ringing. There are so many entertainers who are more successful and famous than I am, but they end up poor because they throw all that money away, he says. Its very important to save for my retirement.

More of Nainans frugal habits:

Pay Little to Travel

Even if he gets a generous travel stipend, Nainan keeps his journeys cheap. I took a $1 bus to Boston for a show I was paid $10,000 to do. I use Couchsurfing.com and AirBnB.com to stay for $60 a night or even free. Instead of taking a car to the airport, I take the AirTrain. A 10-ride ticket is only $25.

Respect Your Roots

Im half Indian and half Japanese. Both cultures are extremely, extremely frugal. Indians are especially known for being unbelievable tightwads. I guess its in my blood.

Never Buy New

A self-described gadget freak, Nainan shops for electronics on eBay, often scoring items for one-fifth their price, and frequents the library for the latest best-seller and even language-lesson CDs. I dont buy new furniture. Thats for suckers. There are many people who put stuff on Craigslist, and then as their moving day approaches, they get desperate and give it away for free. Thats how I gota bedroom full of furniture, he says.

Also see: 7 Things to Never Buy New

Do as the Millionaire Next Door

His million-dollar lifestyle may seem counterintuitive, but its pretty much by the book as described in Thomas Stanleys best-seller, Secrets of a Third-Generation Pawn BrokerThe Millionaire Next Door

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. After all, being frugal pays. Nainan spends no more than $10 on haircuts and $15 on dress shirts. And those run-down sunglasses? Hes had them for five years and counting.

Also see:

No-Gifts Policy

Another way he saves? Nainan refuses to buy gifts for family and friends. Ive trained my friends and family for years not to expect anything from me and, more importantly, not to give me anything. There isnt really anything I need. I live pretty simply.

Nainans lifestyle is up for debate, but its clear that his choices have earned him millionaire status. Is it worth it? Let us know. Connect with me on Twitter @Farnoosh and use the hashtag #FinFit.