How to Be a Financial Minimalist

What is a Financial Minimalist?

Let’s start by defining what a financial minimalist is not, which is someone who’s entrenched in the consumerist lifestyle — where there’s more to lose than just money. In the pursuit of excess and extravagance, you can lose precious time with loved ones and time to focus on your passions. A staunch consumer also has a tendency to gain financial stress, overwhelming clutter and the mindset that more and nicer are better.

Minimalism is always going to look different from person to person based on any number of important factors. – Joshua Becker, Founder of Becoming Minimalist

Living a financially minimalist lifestyle means relinquishing the power that spending money has over you and devaluing possessions, while simplifying how you manage money. If you’re ready to trade in consumerism for financial minimalism, we have eight tips to help you get there.

Joy Exists in Owning Less

Is the purpose of your life to chase more, bigger and better possessions? How much will you need to own to feel fulfilled and happy? It could be endless… See if you can detach feeling joy from things you accumulate, and seek joy in more meaningful ways that are non-materialistic.

Reducing your materialist tendencies is highly likely to make you happier — and the good news is it will cost you nothing. – Jason Butler, Personal Finance Expert

Patience is Required

As you begin your journey, it’ll take time to experience the rewards of buying less and saving more. Over time, impulse spending and the need for instant gratification may dissipate as growing savings brings greater satisfaction. Stay committed and trust the journey!

Cut Maintenance Costs

It takes time and money to maintain the items we own. Let’s say, for example, you own a large house. You have to spend more time on its upkeep — as well as more funds to repair, renovate, decorate and outfit the home. Is all the extra space necessary?

Americans will have to spend nearly $9,400 in hidden costs to own and care for a median-priced home. – Zillow and Thumbtack

Cherish What You Have

The temptation to always upgrade and replace your stuff is real. To resist, try to value what you have now, and adopt a responsibility to take greater care of it! Reduce your consumption by extending the lifespan of your possessions with some extra love and attention.

Don't Get Caught in the Comparison Trap

Fact: There’s always someone who has fancier things and more than you. If you’re constantly trying to keep up in the rat race by living beyond your means, you’re setting yourself up to lose. Is showing off a shiny life really worth spending frivolously and going into debt?

The greatest protection against falling into the comparison trap is to develop and maintain a stable sense of self. – Psychology Today

Spend with Purpose

Give your finances an in-depth audit and thoughtful assessment. Looking back, some past purchases may not have been the best use of your money… Discovering your financial values and focusing on priorities can help you spend more intentionally without a chance for regret.

Lower Financial Stress by Consolidating

Managing multiple bank accounts, credit cards, debts and investments can be a major source of stress. Get a stronger grasp on your finances by keeping minimal checking and savings accounts, using fewer credit cards, and consolidating debt and investments like your 401(k).

90% of Americans say that money has an impact on their stress level. – Report by Thriving Wallet

Your Finances, Simplified

If you budget, great! However, keeping a budget doesn’t necessarily ensure you’re allocating your money in the best way you can. See if you can tighten your budget by cutting categories or decreasing a category’s limit. Narrowing down goals to one or two can help too.

Becoming a financial minimalist doesn’t happen overnight, and you don’t have to abide by all the “rules” on how to be one. Adopting only a few tips may be all you need for changing your mindset and dismantling your desire to buy, buy, buy. To help you stay the course, set up monthly meetings with yourself (or with whom you share financial responsibility), to notate setbacks, success, progress and ways to improve.

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The material presented here is for educational purposes only, and is not intended to be used as financial, investment, or legal advice.