Living below your means (LBYM) means spending less money than you earn. This allows you to save money and build up your financial reserves, which can provide security and stability in the future. It can also help you avoid going into debt or over-extending yourself financially.

To live below your means, you need to be mindful of your spending habits and make conscious decisions about where and how you spend your money. This might mean setting a budget, tracking your expenses, and making choices that prioritize long-term financial stability over short-term gratification.

Living below your means doesn't necessarily mean living a frugal or austere lifestyle. It's about finding a balance between spending and saving that works for you and your financial goals. It's also about making choices that align with your values and priorities, rather than being swayed by consumer culture or peer pressure. By living below your means, you can gain more control over your financial future and work towards a more secure and financially stable life.

LBYM discussions sometimes involve the safe withdrawal rate concept. By keeping the withdrawal rate low such as 3%, investors can avoid depleting their portfolio too quickly, as they may need to rely on their investments for freedom away from work.

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