The Money Psychology: Minimalist Living and Sensible Spending

By Evan Gerdisch, Contributor, Fea Money Financial Literacy School. Photo Credit Unsplash

The modern and oft-blogged view of minimalism appears to be at once very old and very new. The term itself was first widely applied to art and design trends in America during the 1960s and 1970s, but its guiding philosophies are much older. Certainly, the simplicity espoused by Japanese Zen philosophy influenced minimalist architecture and design, and the sentiments behind it- namely of freedom and essence of living- align with many modern perceptions of a minimalist lifestyle. 

In recent years, however, certain elements of minimalist living have been touted as panaceas. A common, albeit reductionist, view of minimalist living is that Scandinavian decor or culling your wardrobe will automatically engender happiness. Certainly, these elements can be a part of the equation, but they do not get to the heart of minimalism. 

What is Minimalism?

As with most buzzwords, “minimalism” and “minimalist living” have as many definitions as there are bloggers, but most preach living a discerning, pragmatic lifestyle.

I’d add that minimalist living is asking “Why?” instead of “Why not?” Too often, our decisions as consumers are guided by the motto, “Why not?” If an awesome jacket is 70 percent off, I immediately think, “What a deal! Why not buy it?” A minimalist mindset me would ask, “Why do I want this jacket? Will it contribute to my long-term comfort, productivity, or happiness?” If the answer is “no,” then I move on. Consequently, minimalist thinking is invaluable to budgeting, but more on that in a minute.  

Live with Less; Live for More

Minimalist living is not just about consuming less. It is, fundamentally, a tool that helps you prioritize and live more deliberately. The focus on possessing less stuff is simply a manifestation of the mindset that minimalist living creates. 

The first step to minimalist living is not to throw out unused clothing; the first step is self-reflection. Prioritize your career, social, and personal goals, and then determine what possessions contribute to you being able to meet these goals.

If you want to start developing the minimalist mindset, but find the prospect a bit overwhelming, just start small.

Minimalist Living and Financial Wellness

A hugely beneficial side-effect of minimalist living is that it encourages economical thinking in a few key ways: 

Minimalist Thinking Rejects Consumerism and Conspicuous Consumption

If you ask, “Will this contribute to my long-term happiness or productivity?” before every purchase, you will no longer make frivolous bargain-bin buys or splurging on unnecessary luxuries to build an image.

After all, a central tenet of nearly all descriptions of minimalist living is that you are not defined by your possessions. What you own should facilitate your well-being and nothing more.

Minimalist Living Encourages More Deliberate Purchasing

That is, choosing the right item for the job even if it costs more money. After all, high-quality purchases may cost more initially, but they last longer and perform better than cheaper counterparts, saving you money in the long run. 

For example, when looking to purchase a new pair of shoes, the thought process of a minimalist might go, “What shoes will match with most of my outfits, be appropriate for a variety of occasions, and last the longest?” The pair that best fits this description will almost certainly cost more but will also last longer, eliminating the need to constantly replace them and creating less long-term stress as a result.

Minimalist Living Challenges You to Assess Your Financial and Personal Circumstances, as Well as How These Factors Interact

With a bit of self-reflection, anyone with considerable debt will make one of their top priorities to get out of it, considering the psychological and physiological stress it can put on a person. 

Being mindful of what you purchase and how it contributes to the life you want is a great start for debt reduction and better money management. For instance, consider what you put into your body. Minimalist living doesn’t necessitate that you eat organic and vegetarian, but it does challenge you to consider how your diet influences your happiness and success. Start simple and eat out less. Restaurant portions are often unnecessarily large and are rarely healthy. Cook at home instead. This will save you money, allow you to shape your own unique tastes, and help you realize what you do and do not need and use in your kitchen, helping to reduce household clutter. 

Ultimately, minimalist living is a mindset to help you prioritise. It fosters a shift in perspective from “What do I want?” to “What do I need to live how I want?” The distinction may be minor, but it can have a huge impact personally and financially.  

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