How can I spend less?
One things about psychology - people spend more money when its an abstract concept instead of having cold, hard cash. What does this mean? People spend more money when they use credit cards for day to day purchases. While I still use a credit card for day to day purchases, there's a big difference between bringing $200 to costco to pay for groceries and laying out 10 $20 bills vs swiping a card when you see a number flash on the screen. If you're truly looking to reduce expenses, keep this in mind. Try the Envelope Budgeting System. It is a pretty good system for managing your discretionary outflows. Also, be sure to pay yourself first. That means treat savings like an expense (mortgage, utilities, etc.) not an account you put money in when you have some left over. The problem is you NEVER seem to have anything leftover because most people's lifestyle adjusts to fit their income. The best way to do this is have the money automatically drafted each month without any action required on your part. An employer sponsored 401K is a great way to do this. Try having money automatically deducted from your paycheck and put into a retirement account or savings account.  As long as you don't have a problem with spending more than you have, the easiest way to stop spending money is to have it automatically put somewhere that you can't (or are unlikely to) touch it. "There are many tactics you can use.  If your biggest problem is regretting your larger purchases, I'd suggest giving yourself rules before making any purchases over a certain minimum dollar amount that you set for yourself.  For example, if that amount is $50 for an item, then any item starting at an average price of $51 would be subject to these rules. One of your long-term goals ought to be to become the kind of person who finds joy in saving money rather than spending it.  Make friends with frugal people - look for those who prefer games nights and potlucks to nights out at the club buying expensive drinks and dinners at the newest steak joint in town.  Learn the thrill of a deal, but even more learn the thrill of your savings growing.  You don't want to enjoy money in the bank for the purposes of becoming a miser.  Instead you want to realize that money in the bank helps you achieve your goals — buying the house you want, donating a significant amount of money to a cause you ardently support, allowing you to take a dream vacation, letting you buy with cash the car you always wanted, the possibilities are endless.  As Dave Ramsey says, ""Live like no one else, so you can live like no one else."""
I know folks who considered retiring to another country. Their conclusion was that while base cost of living was lower, the cost of the things that they enjoy doing -- not to mention the cost of spending time with friends they didn't want to give up -- would be sufficiently higher to erase most of the advantages. Those of us who grew up in or close to cities feel much the same way about moving out to less-populated and less-expensive parts of our own country.  Basically, when cost of living is high it tends to be because there are more people who want to live there and are competing for resources (and driving prices up). Low cost of living is generally tied to less-desired locations, for the same reasons. IF you can find a location that appeals to you, and if you can get the resources there which your preferred lifestyle requires, this may make sense. For a while there were a number of professional writers moving from the US to Ireland, in part because the Irish tax structure heavily favored writers and other creative artists. (Katherine Kurtz spent several years living in a renovated Irish castle.) I'm not sure how many have stayed there after the novelty wore off. "If I understand right, you're asking whether it's better to withdraw a currency that is more valuable or less valuable, in currency units, than your home country's currency.  That is, using your examples, you're asking whether it's better to withdraw euros when the euro is worth more than the Pakistani rupee, or when the euro is worth less. The answer is that it doesn't matter.  What matters is whether the euro is worth more Pakistani rupees than it will be worth later.  For instance, suppose that the exchange rate today is such that you can buy 115 PKR for 1 EUR, or equivalently, you can buy 1 EUR for 115 PKR.  (Realistically the rates would be different due to conversion fees, but I'll keep it this way for simplicitly.)  If tomorrow the exchange rate changes so that you need 120 PKR to buy 1 EUR, then you have to spend more rupees to buy a euro, so this is bad for you; it would have been better to buy earlier (when it was only 115 PKR for a euro).  If on the other hand the exchange rate shfits the other way, so that you only need 110 PKR to buy a euro, then this benefits you. because you are spending less than you would have if you had bought earlier.  So, in these terms, you want to change rupees into euros when one euro is worth fewer rupees (and you want to change euros into rupees when one euro is worth more rupees). It doesn't matter how many PKR you spend for a Euro in raw numbers.  All that matters is, are you spending more for that one Euro than you would have spent had you bought earlier or later?  Indeed, for your specific example, it is unlikely that one Pakistanee rupee will be worth more than one Euro in the foreseeable future; as far as I can see, the Euro has never been worth less than about 50 rupees. In practice, of course, it's hard to know whether the current rate is ""good"".  You can't easily know how currency rates will change in the future.  If you are just visiting for a short period of time, it probably doesn't make sense to worry about the exchange rates.  Just take out as much money as you need when you need it.  You're just as likely to lose money as to save money if you try to game the exchange rates.  If you're staying in a place for a longer period of time, it might be worth pulling a bit extra out at a time when the rate is especially favorable, but you're still unlikely to see major savings in the long run." "You could end up with nothing, yes.  I imagine those that worked at Enron years ago if their 401(k) was all in company stock would have ended up with nothing to give an example here.  However, more likely is for you to end up with less than you thought as you see other choices as being better that with the benefit of hindsight you wish you had made different choices. The strategies will vary as some people will want something similar to a ""set it and forget it"" kind of investment and there may be fund choices where a fund has a targeted retirement date some years out into the future.  These can be useful for people that don't want to do a lot of research and spend time deciding amongst various choices.  Other people may prefer something a bit more active.  In this case, you have to determine how much work do you want to do, do you want to review fund reviews on places like Morningstar, and do periodic reviews of your investments, etc.  What works best for you is for you to resolve for yourself. As for risks, here are a few possible categories: Time - How many hours a week do you want to spend on this?  How much time learning this do you want to do in the beginning?  While this does apply to everyone, you have to figure out for yourself how much of a cost do you want to take here. Volatility - Some investments may fluctuate in value and this can cause issues for some people as it may change more than they would like.  For example, if you invest rather aggressively, there may be times where you could have a -50% return in a year and that isn't really acceptable to some people. Inflation - Similarly to those investments that vary wildly there is also the risk that with time, prices generally rise and thus there is something to be said for the purchasing power of your investment.  If you want to consider this in more detail consider what $1,000,000 would have bought 30 years ago compared to now. Currency risk - Some investments may be in other currencies and thus there is a risk of how different denominations may impact a return. Fees - How much do your fund's charge in the form of annual expense ratio?  Are you aware of the charges being taken to manage your money here?" The same can be done in the USA depending on what city and how richly someone wants to live.  I went to a fine public school in suburban US and I walked to school just a few blocks, free, as are all public schools.  As for medical bills and your best friends mother, it is also not expensive to die of cancer in the USA!  But, you did not tell me how big of an apartment can be had in Lisbon for a minimum wage worker spending less than 30% of his income, nor how big is a 2 bedroom apartment there. "There is a saying in business: what gets measured gets done. Track every expense you make. Later, look over what you have learned. If 5% of your total budget is going to something frivolous, maybe you could halve it? If 1% or 0.1% is going to that frivolous expense, there's not much to be gained even by eliminating it. If you spend $200/mo on coffees, dropping those will help. If you spend $10/mo on coffees, you need to look elsewhere for your big savings. Have a target: I want to put $X into savings each month. Therefore I can only spend $Y. What do you have to change about last month's spending patterns to get down to $Y? Where are the easy targets for you? They will be different than the easy targets for me. What absolutely cannot change for you? Once you know the costs of what you're doing, you will know where it's possible to save, and where it's ""worth it"" to economize." "First of all, I have to recognize up front that my ""spending personality"" is frugal. I don't recreational shop, and I save a lot of my total income. Building a budget and sticking to it is difficult, especially for people who are closer to living paycheck to paycheck than I. Theoretically, it should be easy to stick to a budget by overestimating expenses, but for many people planning to spend more than necessary isn't a luxury available. That said, I have a system that works for me, maybe it can work for you. This system lets me see how much I have to spend, and close to optimally arranges assets. As you can see, this system relies on some pretty strong upfront planning and adherence to the plan. And what you might not realize is that you can deviate from the plan in two ways: by spending variations and by timing variations. Credit should really help with a lot of the timing variations; it takes a series of expenses and translates them into one lump payment every month.  As for spending variations, like spending 20 dollars for lunch when you only budgeted 5, it turns out this technique helps a lot. Some academic work suggests that spending with plastic is more likely to blow your budget than cash, unless you make detailed plans. But it sounds like your main problem is knowing whether you can afford to splurge. And the future minimum balance of your checking account can be your splurge number." "People should borrow and spend less, and save more.  Is this truly correct? Isn't the fundamental problem high supply and no demand?  Shouldn't it be ""borrow less but spend more"" - which of course would mean getting higher wages.  Am I wrong? Please to be educating." "One of the most effective tools we have to keep ourselves from doing things is procrastination.  Most of the time procrastination is a bad thing because we use it to avoid doing things we should be doing.  But it's equally effective at keeping us from doing things that are not good for us, like overspending or overeating. How do we procrastinate things like this?  Put it on a big, fat, TODO list somewhere that you seldom look at.  That will get it out of your head...your subconscious will not keep bugging you about it because it's not worried about forgetting it.  Save the discount code in the list so you know you will have it if you ever want it.  Put other things that you are unlikely to do any time soon on that same list.  Then move on with your life and enjoy your freedom from useless and expensive clutter. I use online TODO lists (also google docs) for keeping track of things I'm supposed to be doing.  One of my lists, ""long term purchases,"" contains a bunch of expensive stuff that I have wanted at some point but not gotten around to purchasing.  I think the list has saved me a lot of money.  Stuff stays on that list a long time.  Ultimately most of the items on the list either become cheap or I lose interest in them. There's a reason salesmen push you to buy NOW NOW NOW.  They know if you procrastinate the decision, you are much less likely to buy."