Simplicity to Savings: How Minimalist Habits Boosted My Wealth

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Around late December and early January every year, the internet unloads an avalanche of money-themed New Year’s advice — resolution fuel for people trying to break old habits and start new ones. Well-intentioned as it all might be, the annual blitz can feel a bit overwhelming. The good news is that you only need to worry about a handful of things.

Read: What To Do if You Owe Back Taxes to the IRS

7 Minimalist Habits For Frugal Living To Help You Save Money

Building your wealth or saving a lot of money are both important steps to creating financial freedom in your future. Having a minimalist mindset can help edit your spending habits, lower the amount of money you spend on impulse purchases and help you start saving rather than waste money. Josh Richner of the National Legal Center advises:

“Make more, save more, invest more, give more, spend less, stress less. Easier said than done, of course, but consistent incremental changes in these areas will have a big impact over time.”

Put down the credit card and enjoy some simple living with these seven tips to save you in the long run:

  1. Educate yourself
  2. Scrutinize your purchases
  3. Eliminate temptation
  4. Tweak boilerplate money advice
  5. Plug the money leaks in your house
  6. Throw extra cash at your debts
  7. Keep good company

1. Educate Yourself

Jacqueline Gilchrist, the founder of Mom Money Map, is all about self-improvement through self-education. She wants people — especially young people — to make it a point to read about money whenever they can.

“Every time I read a personal finance book, I get a new perspective on how I can better grow my wealth,” Gilchrist said. “For example, after reading the book ‘Your Money or Your Life’ by Vicki Robin and Joe Dominguez, I realized how you don’t have to trade your time for money. There are many passive income streams like dividends and rental income that you can nurture that will help you reach financial independence earlier.”

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2. Scrutinize Your Purchases

For Angela Bradford of World Financial Group, the best change a person could make is to start second-guessing every purchase.

“The habit of saving is exactly that, a habit — and it can be taught,” Bradford said. “Thinking before you spend money — do I really need this?”

You should also get in the habit of not viewing money as a means of competition. Bradford discussed the importance of people “being conscious of where their money is going and not caring about keeping up with the Joneses.” That holds whether the Joneses are your neighbors in real life or influencers portraying unachievable lifestyles on Instagram.

3. Eliminate Temptation

Most of us have subscribed — knowingly or unknowingly — to more retailer newsletters than we would care to remember. In most cases, they’re worms on hooks — bait for your money.

“Retailer newsletters are usually sent out pretty regularly,” said Julie Ramhold, consumer analyst with DealNews. “And while they can be helpful if you’re watching for a sale, there are some that seem to always be having sales. If these newsletters tempt you into spending when you hadn’t otherwise planned to do so, it’s worth unsubscribing. You can always subscribe again later if you want to, especially around times when they may be having truly good sales, like around major holidays like Memorial Day or Black Friday.”

4. Tweak Boilerplate Money Advice

If you stumble upon what seems like good financial advice, don’t be shy about following it as an outline or incorporating it into your strategy. But remember, if it was written for the masses, it wasn’t written for you.

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“Everyone’s financial situation, needs, and goals are unique,” said Drew Parker, creator of The Complete Retirement Planner. “So it is particularly important not to rely on guesses, assumptions, generic benchmarks, or any advice that presents broad generalizations as specific goals. To know exactly where you stand, where you are headed, and how to get where you want to go, every household, regardless of their net worth or stage of life, owes it to themselves to create a comprehensive, individualized financial plan. This is a crucial step in assessing your current and future financial health and acts as a roadmap to becoming financially secure. It helps you to establish realistic goals, understand the direct impact that current decisions have on long-term results, and to track your progress.”

5. Plug the Money Leaks in Your House

Throughout the year, but particularly in the wintertime, it’s likely that your house is slowly but steadily leaking money through heat transfer and other energy-gobbling inefficiencies. Get in the habit of doing basic seasonal assessments a few times a year.

“Do a simple check around your home to save on energy this winter,” said Aimée Bennett, APR, principal of Fagan Business Communications. “Check your home carefully for any spots where cold air can get it. Pay special attention to windows and doors. Then, install weather stripping and door sweeps or ‘draft dodgers.’ Also check outlets, locks, air conditioning units, and recessed light fixtures.”

The Department of Energy’s Energy Saver program offers tips and tutorials on DIY home energy assessments.

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6. Throw Extra Cash at Your Debts

If you do cash in on lower heating bills, dedicate at least some of those savings to paying down more debt than you have to.

“Find a way to pay extra, even a little bit extra, on your outstanding debts,” said Melanie Hanson, editor-in-chief of EDI Refinance. “Even an extra $20 per month can add up quickly in terms of savings on interest payments.”

7. Keep Good Company

Tell me who your friends are and I’ll tell you who you are, the old expression goes — and if life seems like one string of bad luck after another, it might be time to surround yourself with some new people. 

“If you are not happy with where you are in life, then find new friends,” said Jason Parker from Parker Financial and the founder of RetirementBudgetCalculator. “Coach John Wooden said we become the average of the five people we spend the most time with. If you are broke, unhealthy, or depressed, look at the people you are surrounding yourself with. Wealthy people hang around with wealthy people. Healthy people have healthy friends. Birds of a feather flock together.”

Final Take To GO 

No matter if it is starting an emergency fund or getting a better handle on your spending habits, there can be simplicity in saving money and boosting your wealth. It’s not just about focusing on what you need to change but also if things are going well take the time to be grateful for the people around you and what you have.

“If you are happy with where you are in life, be sure to recognize how good you have it,” Parker said. “There are few things worse than people who have it all, and yet complain about how bad things are. We have to train ourselves to focus on the good.”

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FAQ

Here are more answers to questions about simplifying your finances.
  • What is simplicity in finance?
    • Simplicity in finance essentially means keeping plans and solutions easy so you can understand them, implement them and maintain them. A finance plan is easier to achieve if you can both comprehend it and execute it.
  • How can I simplify and save money?
    • Here are a few ways you can simplify and save money:
      • Educate yourself
      • Scrutinize your purchases
      • Eliminate temptation
      • Tweak boilerplate money advice
      • Plug the money leaks in your house
      • Throw extra cash at your debts
      • Keep good company
  • What is a great principle for saving money?
    • Outside of adding simplicity to your savings make sure to pay yourself first. In other words, allocate a percentage of your money into a savings account before using it for other expenses. This is an essential step to saving your money, and it can be done by including saving as an expense item in your spending plan or automating your deposits.
  • How much money should you have in savings?
    • Though this will vary depending on specific financial situation or expenses, many experts recommend having at least three to six months of living expenses in an emergency savings fund. This is to cover unexpected situations such as job loss, medical emergency or other unexpected costs.

Andrew Lisa contributed to the reporting for this article.

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