It was a habit of Sayyidina Rasoolullah sallallahu alaihe wasallam to wear simple clothing right up to the time of his demise, even though the standard of living had generally improved. After the conquest of Khaibar the economic situation of the Muslims became better. After the conquest of Makkah, the kings of other countries also began sending presents etc.. Despite this, Sayyidina Rasoolullah sallallahu alaihe wasallam did not change his standard of living. He lived simply and whatever was sent to him was distributed to others. A few examples have been mentioned in the book ‘Stories of the Sahabah radiyallahu anhum’.
Imam Nawawi says that this hadith and other similar ones point to the fact that Sayyidina Rasoolullah sallallahu alaihe wasallam loved the Hereafter and stayed away from luxuries. Thick and coarse clothing makes one feel humble and simple, while the wearing of fine clothing makes one feel great and proud.
My saint, Maulana Hakim Jameelud-Deen Naginwi Ad-Dehlawi related an incident of Maulana Gangohi that when he went for Haj and while performing tawaaf, a blind saint was sitting on the outer side of the Mataaf. Whenever Maulana passed by him, he said softly, “Wear the clothing of the pious.”
When Maulana completed the tawaaf and went to the side where the blind saint was sitting, he heard him say, “Khashin, khashin (coarse, coarse),” by which it was meant that the clothing of the pious was made of coarse material.
Sayyidina Rasoolullah sallallahu alaihe wasallam generally wore coarse clothing. There is also evidence that he, sometimes, wore clothing made of fine material due to some religious benefit, if it was available. He normally did not wear clothing made of fine cloth.