One thing I am very excited about is Minimalism. I am of the belief that the less stuff you have in your life and the less you focus your attention on the stuff you accumulate the happier you will be. This is where it leads me to how Minimalism can help you save money as your not buying stuff you don’t need. For sometime I’ve been following The Minimalists blog www.theminimalists.com and they have some really great tips for living a simpler life.
Late last year I had the pleasure of going to a talk and sharing a hug at the end with Josh and Ryan when they came to Sydney on their 100 city worldwide tour discussing their new book ‘Everything That Remains’. Its a great read on how minimalism really allows you to focus on what matters in life. I don’t think everyone should go throw out all their things and live in an empty house but i think putting less emphasis on buying stuff we don’t need is really rewarding. I at the best of times have been a really great consumer when it comes to purchasing the newest technology, latest fashions etc. but since giving minimalism a try I have been able to save a lot more money and when I do buy new things i spend some time deciding if it will add value to my life. Yes I still go out and buy new clothes and other things but definitely not as often as i used to.
In our society it is very easy to fall into the trap of wanting the best of everything and all immediately. Gone are the days we fix things when they break. Gone are the days we spend a year saving up for something we actually need. If you are in debt currently other than a home loan I would say try and apply minimalism to your life and pay that debt down. Life is too short to worry about paying off consumer debt for things that don’t add value.
The first step to financial freedom is reducing your credit card debt and if you have more than one credit card I would recommend cutting the others up and only keeping one. The next step is if you have a car loan write up a plan to pay that loan off sooner than the minimum repayments. What worked for me a few years back was to make double the repayments. I had 12 months left on my car loan and doubled my repayments and became debt free in 6 months. Car loans are a waste of money as you are paying a premium for a depreciating asset. By the time you pay the loan off you have probably paid more than double what your asset is worth. This was my lightbulb moment, after years of racking up debts while earning a great salary I was finally not having to pay any debt repayments at the end of the month. Instead i started compounding my wealth by saving and investing. Every month if you chip away at those repayments just think your one step closer to financial freedom.