Four 'Against the Grain' Ways to Save Money

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More is not necessarily better, even in finances.

With the economy having trouble, many financial experts are recommending downsizing as a way to save money. I would take it a step further and argue that it's one of the quickest and easiest ways to build wealth.

While the term "downsizing" has a negative ring to it due to the connotations of people losing their jobs and the image that you're being forced to give up more for less, in reality it should be viewed as simply learning to buy the correct size that fits your needs. The only reason that most people need to downsize is because they have always bought more than they needed in the past.

Here are a few examples of why most people should downsize:

Your house is too big.

The conventional wisdom when buying a house is to buy the biggest house that you can afford. As the housing crisis is making clear, many people took this concept a step further and bought houses even bigger than they could afford, thinking that it would be a good investment. They are paying the price now for this ill-fated assumption. If you want to be wealthy, you should be looking for a home that fits your needs.

Take Warren Buffett. Even with a net worth of $62 billion, he lives in the same house in Omaha that he bought in 1958 for $31,500. Most people with far less money would have continually upgraded their home as they earned more, whether they needed to or not. Buffett's house meets his needs, and therefore he sees no reason to move. You could greatly improve your finances by following his example.