Minimalist Guide to Personal Finance (and the stuff that dreams are made of…)

October 29th, 2009 § 0 comments

Written by Everett Bogue | Follow me on Twitter

I’m going to say a slogan that you have probably heard before: spend less than you earn. It’s the only way to get out of debt. We nod, we get it. It makes sense, right?

So we spend less than we earn when we’re in high school, and then we spend way more than we earn in college, and then get out of college and most of us spend less than we earn and try to pay off those loans.

Than an interesting thing happens, if we have one of those day job situations that most people are in.

We get a raise.

And suddenly we have this extra thousand, or two thousand, or ten thousand extra dollars. Oh my! What are we going to do with all of this money?

I can tell you: most people spend it.

People are exceedingly good at spending all of the money they earn. I’ve known people who were making $12,000 a year and getting by fine in New York, I’ve known people making over $100,000 a year and struggling to save anything in New York. They were living in the same house, paying (nearly) the same rent.

But what if you spent way less than you earn?

What if you said to yourself: I don’t need to fill up my life with useless crap anymore. I don’t need my cable TV bill. I don’t need my first car, or my second car, or my third car.

I can tell you the answer, if it hasn’t already occurred to you. You’ll save money, you’ll pay off your debts, and then someday if you’re really lucky, you’ll be able to spend that money on your dream.

The stuff that dreams are made of.
If you live a minimalist lifestyle, spending exactly the bare minimum to survive every month. You’ll someday be able to do something. Or better yet, quit your job right now and you’ll be forced to spend the bare minimum to survive, and eventually you’ll actually do something.

Something that’s yours, something that you own, that you’re responsible for. Something so important that your actually passionate about it. These are the kind of dreams that you should be dreaming.

But all of this is confusing, they told me I wanted a house, that I wanted a full time job.
Some people get really confused here, which is understandable. You’ve been conditioned your whole life into thinking that dreams are a bigger house, they’re a bigger yard, they’re a new kitchen set, they’re keeping your old kitchen set in storage.

Dreams are not made of bigger houses.

I’ve seen where that old kitchen set sits in storage, and it’s dusty and not used very much. It’s in fact, useless.

A fork is just a fork, and a plate is just a plate. It doesn’t matter how fancy they are, and you certainly don’t need twenty five of them to eat dinner.

A dream isn’t a dream unless you do it.

You can’t have the money to do a dream if you spend it.

If you stop spending your money on perpetuating a corporate cycle of consume, destroy, consume destroy, you’ll be able to do something important.

How to save for the future, minimalist style.

  1. Make sure every cent you spend is for absolute necessities.
  2. Move to a smaller house, rent a smaller house, one costs less.
  3. Abandon cars, take public transportation (move to an area with public transportation.
  4. Save the rest for your dreams. You’ll have way more than you would if you spent it all.

Here’s an article and a blog that will help you.

The True Cost of Stuff [Mnmlist]

And basically read everything on GetRichSlowly

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