Practice Minimalism to Simplify—and Boost—Your Financial Life

Jul 7, 2020 | Lifestyle | 0 comments

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Minimalism isn’t just about a tiny house, capsule wardrobe, or Marie Kondo. It can even mean different things to different people. But at its core, minimalism is about “less is more.” In personal finance, it doesn’t mean you stop spending money. Instead, eliminate distractions. This way, you can create more opportunities to spend on things that matter-and shift your mindset from making money to enjoying life.

1.  Declutter & Organize Finances Better

Clutter is the enemy of minimalists for various reasons. It creates visual and mental chaos, and having too much stuff means you have spent money on things you rarely use or need. Even if you don’t switch to a thoroughly minimalist lifestyle, it’s good practice to declutter regularly. You can earn extra income and keep your living space organized by merely selling old clothing, shoes, and household items.

Decluttering may also mean consolidating your bank accounts into a single savings account and one checking account. You can then simplify your banking and track your finances better. If it’s possible, cut back to one credit card. Choose one that offers the best rewards and interest rates. It will be easier to manage your monthly spending and handle payments with one credit card than having five or ten.

2.  Adopt The One-In , One-Out Rule

This rule of minimalism is simple: every time you buy something, you have to get rid of another thing you already have in the same category. Say, you want to buy a new belt, you have to let one of your old belts go. That is easy when you haven’t decluttered, but once you’ve pared down, it can be a harder decision. In a way, this helps you be mindful of every purchase and break the habit of impulse buying. Plus, with a formed habit of buying what you only need, you can free up money to invest and secure your future.

3.  Go For Multi Purpose Investments

To do more with less, minimalists often focus on items that serve multiple functions. Instead of merely buying a new wooden bed frame, they will look for one with built-in storage. You can take the same approach not only on your new purchases but also on investments. For instance, get a life insurance policy that comes with investment plans. You can cash in the investment to enjoy your retirement years. And with life insurance, your family’s financial future will be secured after your death.

4.  Value Experiences Over Material Things

The coronavirus pandemic has probably shown you what’s essential and what’s not. Build on that by looking at shopping as something you need, not something you do as a hobby or therapy. Many minimalists emphasize that acquiring less allows you to free up more time and money to create experiences. With or without pandemic, spending time with your loved ones should always come first.

Whether in fashion, home design, or personal finance, minimalism is about discovering what we need. By living with less, we have more room in our lives for things, experiences, or people who truly matter.

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– a contributed post

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