Nine money secrets of the Amish

The Amish lifestyle — and how they handle their finances — can seem a bit mysterious to outsiders. Typically, our only glimpse of the Amish is when they're seen in their horse and buggy running errands in small towns across Ohio, Pennsylvania, and Indiana.

So this prompts a question: How do they handle their money and finances? And what can we glean from their thrifty lifestyle that might help us become more financially independent? Here are nine money secrets from the Amish lifestyle that you'll find fascinating — and hopefully educational, too.

1. They Avoid Debt and Credit Cards

While some Amish will indeed use credit cards for the reward points and convenience, the number who actually carry plastic is only in the 20% range. Most pay for things as they buy them in order to avoid any debt. They also live by the rule of always paying someone on time. According to Amish Bishop Ephraim Lapp, "To pay someone on time is an extension of the commandment 'Do not steal.' If it's due on the 10th and you pay it on the 15th, you are stealing that man's money for five days."

Also, the Amish focus on whether an item is a need or a want, and they teach their children the value of deciphering between the two in order to avoid unnecessary debt. By instilling this philosophy into their children from an early age, they raise appreciative kids who value the things they do have.

2. They Grow Their Own Food

The Amish grow almost all of their own meats and vegetables and not only save significant money, but serve much healthier meals in the process. While raising your own cattle and pork is simply not an option for everyone, you need very little space to start a small gardenor herb box of your own.

3. They Make Saving a Priority

While the average American saves in the 5% range, the average Amish adult saves close to 20% of their monthly income. Savings becomes a way of life for the Amish and creates a sense of financial independence. Knowing that you owe money to no one, and are actually accruing interest on your savings, is something most Amish cherish.

4. They Avoid Government Handouts

The idea of receiving food stamps, a welfare check, or government handouts is something the Amish frown upon. Part of this philosophy can be tied to their self-sufficiency and strong community which believes in helping each other when someone is having a rough spell financially.

5. They Value Experiences Above "Things"

When the Amish do make a purchase, they make sure the item provides value and is of high-quality, even if the item costs more upfront. Rarely, if ever, do they fall victim to flashy marketing campaigns designed to separate you from your money. They have the proper perspective when it comes to material things, and they place a high value on experiences and personal relationships.

6. They Are Smart Business Owners

According to Erik Wesner, who wrote the book An Inside Look at Why Amish Businesses Thrive, Amish small businesses have a survival rate hovering around 95%, compared to a 50% success rate for non-Amish. The reasoning has to do with leadership techniques and a strong work ethic. Business owners don't simply delegate all of the work and sit back and count the cash. Instead, they work right alongside new hires and create a sense of credibility with employees and customers, alike.

7. They Rarely Waste Anything and Fix Everything

Frugality and resourcefulness is a way of life for the Amish. Clothing that is worn beyond use is cut for rags, and broken tools are fixed before the thought of being discarded enters the conversation. Part of their philosophy has to do with everything having a purpose and they don't succumb to the desire of wanting the newest fashion line or brand. The admirable decision to delay gratification creates wealth that can be used for significant purchases like farms, homes, and cattle. All purchases that can actually add to long-term happiness and financial security.

8. They Buy in Bulk

The Amish are famous for buying goods in bulk, both as a way to save money via quantity discounts, but also as an affordable way to feed a large number of mouths. Remember, most Amish families have several children in the home, and thus are cooking large meals. When I say "bulk buying," I'm talking about more than an average trip to Costco. Amish families regularly buy rolled oats in 50 pound sacks, 400 pound bags of flour, and 200 pound bags of sugar. While these amounts are simply not feasible for most families, there is no doubt that buying bulk items, in reasonable amounts, is a great way to save money.

9. They Rarely Pay Retail

Because of the large family size in most Amish homes, they "shop smart" and consider thrift stores, salvage stores, and auctions as the most practical way to stock up on clothing, tools, and household items.The idea of paying full-price for an item is something the Amish avoid as they realize the value of buying high-quality used items at a discount, especially if they can repair items to "like-new" condition for free.

Despite contrary belief, many Amish families will shop at a local Walmart if one is nearby. They take advantage of the low prices and bulk sizes available in many locations. According to Amish America, "Amish do not have moral issues with shopping at large retailers, viewing it as a matter of practicality and economy. It is not uncommon to see long rows of Amish buggies lined up at the buggy rails outside of Walmarts and other stores in Amish areas, and to frequently find Amish shoppers in the aisles."

By taking an inside glimpse at the Amish lifestyle and how they handle their money, we can learn some pretty cool tools on handling our own finances. Tools that can undoubtedly help you spend less, save more, and put money in the proper perspective.

This article is from Kyle James of Wise Bread, an award-winning personal finance and credit card comparison website.