Home » What is minimalism and its benefits in managing personal finances?

What is minimalism and its benefits in managing personal finances?

What is minimalism and its benefits?

Photo courtesy Beazy on Unsplash.

A minimalist lifestyle is when we choose things that provide value in life and avoid the unnecessary things that only serve to distract us. It involves managing with fewer resources and things in our possession.

There is a relationship between minimalism and personal finance. The things that bring value in life are completely connected to our habits of spending, saving, and investing. The unnecessary spending habits have to be put in check to reach our financial goals.

Minimalism is the philosophy of finding happiness in what we have. Minimalist persons focus less on material possessions and more on what they have and this is what makes them happy. It means choosing to live life with a great purpose. People don’t purchase things that they don’t really need.

Some characteristics of a minimalist person-

  • A minimalist person likes to keep his life simple, maintains a balanced perspective of things and knows that too much of anything is bad.
  • Their wardrobe is simple and they purchase clothes that are really needed. There would be few clothes and they can mix and match to suit the occasion.
  • Every space in the house is well organized and they don’t keep things more than what is required.
  • The minimalists are very selective in the things they purchase and buy only the things that are required. They don’t shop around for fun. This has another advantage and they are left with more time that they can use to their advantage.
  • They try to lead a zero waste lifestyle and this is beneficial to the environment with less of wastage.
  • The minimalist person is content with what he has and does not try to copy others going on a false ego trip. This leads to a much happier life.

How to create a minimalist home-

  • Start attending to one room in your house at a time and not all the rooms at once which will divide your attention.
  • See the visible spaces which can be de-cluttered and after this work on the hidden spaces like drawers, cabinet and the cupboard. Try to find if the things bring any value to the room or else try to remove them. Remove the unnecessary decoration that would have added over the years.
  • Repeat this process for the other rooms and having less of the unnecessary items would make it easier for the home to be maintained neat and clean. Other than the decorations there would be items like the clothes, toys, cooking utensils and the rarely used furniture.
  • After going through the steps mentioned above resist the temptation to buy unnecessary items again after seeing the advertisements for sale.

Benefits of minimalism-

Minimalism has many benefits and some of them are discussed below-

  • Individuals have a habit of collecting things they don’t need. If you look around, you will find people who have collected additional things that are not really required, be it the clothes, kitchenware or other household items. Being a minimalist helps people to stay content with only the few items and they begin to enjoy the things that they have.
  • People start spending money as soon as they receive salary. Being a minimalist would help you to save money and you would be able to reach your financial goals easily.
  • Removal of unnecessary things would mean that you would be left with few things that you love and the things that connect with the purpose in your life. There would be fewer things to clean resulting in more tidiness and saving of time.
  • You will have more time to spend with the people you love than on unnecessary gadgets and the time spent in collecting them.
  • Minimalists don’t try to compare themselves to the people who run after material things which are not so vital. They are content with the sufficient and important things that they have.
  • There would be less stress as you would not be running around to procure unnecessary items and the ways to make money to procure those items. This would lead a person to be stress-free and healthy.
  • Less stress and good health would lead a minimalist person to be happy as he would be less attached to the material things which would give him a sense of freedom and purpose in life.
  • There is less of waste generated which benefits the place where they live and an improvement in the environment.

Minimalism in India-

India is a developing country and there is less consumerism but it is slowly growing. In Western countries, there is a greater amount of consumerism. This can be due to higher per capita income but minimalism is gaining importance. The people have debt right from student loans to car loans and credit card loans. There are about 3 credit cards for every 100 persons in India while it is 32 cards in the USA. Actually, many of the gadgets the youth hanker for are not needed in life.

We can take the example of Mahatma Gandhi who led a very simple lifestyle. He practiced minimalism in all areas of his life and when he died he had less than ten possessions. Everyone can’t be like Mahatma Gandhi but we can take an example of simplicity from his life. Besides this, we can practice a zero-waste lifestyle which can be beneficial for our environment due to less wastage of materials.

How minimalism can benefit in managing personal finances-

We have seen many job losses during the Covid-19 pandemic. If we have a minimalistic lifestyle we can manage such difficult situations more easily.

Minimalism can be used to manage the budget better. When you make a budget you will know where to cut down on things that are not necessary. This can be aligned with the long-term goals. A person can reduce his unnecessary spending and direct the money saved towards investments.

Not using too many credit cards and not taking loans unless necessary would reduce unnecessary debt and would help you to reach retirement goals easily. The minimalist lifestyle when carried into retirement would hold a person in good stead without having to depend on anyone for money.

A minimalist person adds only the things that bring value to his life. The world today is dominated by persons who chase the latest gadgets and other materialistic things but a minimalist person only wants to make life simpler and easily manageable. This results in them being less stressed. When a person has found the purpose of his life and has his finances under control he can give back to society through donations which would bring true joy and happiness in his life.

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