It’s also a philosophy that can have a considerable impact on your finances–and not necessarily a positive one. Here’s what you need to know before you try to live a minimalist lifestyle.
How Minimalism Can Improve Your Finances
Those who embrace a minimalist lifestyle don’t necessarily do so with the express motive of improving their financial situation. But many quickly discover that minimalism can have a positive impact on their finances since many of the principles point to healthy money habits. Here’s why:
Minimalism Discourages Excess
The minimalist lifestyle rejects overconsumption and instead encourages you to limit your possessions to the essentials. Instinctively, this means buying fewer things and spending less money on cleaning, maintaining, and replacing your belongings. Also, while you can become and be a minimalist without being debt-free, the two lifestyles often go hand-in-hand. Through the process of shedding possessions and from the desire to avoid excess, many minimalists become and stay debt-free by setting realistic goals. Additionally, because minimalism is a countercultural lifestyle, those who embrace it are not plagued by having to get out of the debt cycle.
Minimalism Forces You to Prioritize Your Spending
Many people incorrectly assume minimalism means having an aversion to buying anything. While this indeed could be one approach, minimalism is less about avoiding spending and more about spending intentionally. Living with less will force you to think twice about what you buy. You learn to distinguish your needs from your wants. And if you’re maintaining a debt-free lifestyle, naturally, you’ll approach your spending accordingly.
Minimalism Encourages Simple Living
Not only is minimalism about having less, but it’s also about doing less—or at least doing less of the things that don’t matter. This lifestyle can mean dropping costly commitments and activities that only add busyness to your life and no value.
How Minimalism Can Hurt Your Finances
Besides the overarching theme of crafting a life with less stuff and more meaning, there are no hard and fast rules to minimalism. Everyone can define and work out their unique version of it. As a result, it’s quite possible to approach minimalism in a way that hurts your finances. Here’s why:
Quality Comes With a Price
A core tenet of minimalism is to prioritize quality over quantity. And that makes sense; if you are living with less and doing less then those things can and should be of quality. But high-quality clothing, food, furniture, travel, etc., can be expensive. And in the pursuit of living out this maxim, there is potential for one to stretch beyond their means. This expense certainly is contrary to the whole idea of minimalism, but depending on one’s approach to the lifestyle, they may walk down that road.
Purging Can Cost You
One of the first acts of embracing minimalism is to declutter and purge your home and life of unnecessary belongings. This experience brings to light just how much stuff you have that you don’t need. But depending on how you go about purging and decluttering, it can be an expensive endeavor. Should you embrace the popular KonMari Method and only keep items that “spark joy,” you may choose to discard and replace possessions that you don’t love but are necessary—a costly approach. It’s also possible to be overzealous in your purging, tossing items that you’ll later discover you do need and have to rebuy.
Simple Isn’t Necessarily Cheap
Like prioritizing quality, pursuing simplicity often comes with a price. If you choose to apply simple living holistically, then you likely will rethink what you eat, drive, wear, and what products you use. Living organically, sustainably, and the like can be costly. Embracing simplicity as a mantra could result in a lifestyle upgrade. As a lifestyle, minimalism can improve your finances, but whether or not it does depends on your version of it, Keep in mind that the goal behind minimalism is to enjoy a life of freedom and meaning. Should you choose to embrace it, make sure that the path you take achieves that objective.
