How to Spend Less: The Minimalist Approach to Money

“Keeping up with the Joneses” is a popular idiom in many parts of the world that has been used to compare one’s accumulation of material goods with their neighbors. And not being able to keep up with the Joneses has been perceived with having cultural or socio-economic inferiority.  The problem with keeping up with the Joneses is that it causes people to live beyond their means and spend money on stuff that ultimately will not make them happy.

Not worrying about what the Joneses have or don’t have is one of the key concepts for how to spend less using a minimalist approach to money. Which brings us to today’s post, which was inspired by a great book I read recently called Do Less: A Minimalist Guide to a Simplified, Organized, and Happy Life. In it, author Rachel Jonat discusses how to take a minimalist approach to many areas of your life. The chapter that most caught my eye was the one focused on how to spend less using a minimalist approach. In the chapter, Jonat asks a question which will help you determine whether or not minimalism will help you rethink your approach to your finances:

“Take a moment to think about your financial life. Do you feel in control of your spending habits? Are you living well below your means, or do you always hit a cash crunch at the end of the month? Are you often asking yourself, where did all my money go?” ¹

If you answered “yes” to any of the above questions, you are not alone, these are common struggles for many of us! However, by taking a minimalist approach to money you will learn how to spend less and hopefully overcome those struggles!

The Minimalist Money Mindset

We were all raised differently and have a different history with money which gives us our own unique mindset when it comes to money. Our aspirations for retirement, wealth, and disposable income may be grand, which may make it seem that minimalism is at odds with our money goals. The truth of the matter is that not only can minimalism complement these goals, it can also help us reach them!

As Jonat says:

“The first step to a minimalist money mindset is simply opening your mind to reshaping how you meet your goals. You need to get comfortable with being a bit uncomfortable and blow up some of your assumptions about how you have to spend your money.” ¹

Is It a Need or a Want?

The main idea she presents is to look at how you are spending your money and to figure out what is a “need” and what is a “want”.

Needs are things such as medicine, food, shelter, and clothes – everything else is merely a want.

The concept of minimalism with respect to money has you asking questions such as, “is this a need or is it merely a  want? For example, that big house you live in – would it be possible to downsize and move to a different area that is closer to work? Doing so could cut your commute time, vehicle costs, mortgage or rent costs and give you more time and money for other stuff.

And remember, needs and wants aren’t just big-ticket items like houses and cars.  Do you really need the most expensive cell phone on the market?  Do you need to eat out for lunch every day or could you pack a lunch?

I really like a piece of actionable advice that Jonat gives which is to:

“Tally up what your wants amount to for a month. Count everything that you don’t truly need, including home Internet service, the lawn mowing service, and the monthly grooming service for your dog. It can be astounding to see how the small extras—the upgrades, the things we often think of as being needs rather than wants—eat up your dollars.” ¹

Spending Money on What You Value

Another great concept Jonat discusses is spending money only on stuff you value. Let me ask you a question – when you buy stuff do you really think about whether it is something you value in life or do you buy first and think later?

The idea is to prioritize what you value in life (i.e. education, travel, your health, time) and start your minimalist value-spending choices from there.

Nevermind the Joneses!

Another reason for some people’s spending becoming so out of control with respect to their values is thinking that we need and want what others around us have.  It’s the whole idea of keeping up with the aforementioned Joneses.

As Jonat points out:

“It sounds cliché, but spending money and buying things doesn’t bring happiness. But having what you want—what you truly need for wellness and the time and focus to do things that really matter to you—that is a recipe for a contented life.” ¹

And by the way, let me tell you something about the Joneses, they aren’t happy.  You see, by wanting more and buying more they have become trapped in a vicious cycle where nothing is ever enough.

Some Simple Tools for How to Spend Less

Let’s now take a look at some great tools that Jonat recommends for how to spend less by using a minimalist approach with your finances.

Use a budget

While many think budgets are complicated, boring, and meant to limit spending, that simply isn’t true. Instead, they can help us say yes more often and help us see that we have more money than we need and that we have everything and more than we need.

Simplify those bills!

The idea here is to take your monthly bills and figure out which ones are necessary (such as mortgage or rent, insurance etc.) and which ones may not be necessary (such as cable, cell phone bills, cable subscriptions etc.)

First, look at your necessary bills and see if you can figure out how to renegotiate or reduce them. For example, can you re-negotiate your mortgage or home insurance to knock some money off?

Next, look at those bills that may not be necessary and figure out which can be reduced or eliminated. For example, do you really need the most expensive cell phone package? Could you reduce your cable bill by just having Netflix and streaming everything else?

Reverse Budgeting

This is one that I use personally, and I find that it works like a charm for me. The idea is to figure out how much you want to put into savings per month, then once that is done you allocate “x” amount, say $3,000, to live off of until your next paycheck comes in.  What I love about this method is its simplicity and the flexibility to spend money on what you see fit. Plus. it makes you really think about how you spend your money.

Wait 30 Days

This tool simply has you wait 30 days before buying something that you want. Many times, what happens is that after 30 days you realize you don’t need it or you have something that already did the trick. It helps you pause to really think about whether or not you need something.

 Use a List When You Shop

How many times have you gone in to buy one thing and come out with a bunch of crap you don’t need? A great deal is hard to resist, right?  The idea here is that by thinking about what you want beforehand and making a list will help you resist all those great deals!

Don’t Go to Stores!

You can’t buy something if you don’t go to a store! Avoiding stores in the first place is another way for how to spend less. And for you smart asses who say, “Well what about online shopping?” Well, I was just getting to that if you wouldn’t interrupt me!  As I was going to say, no online browsing allowed either!

Schedule a No-Spend Day

This one is more of a challenge and the challenge is to see if you can get into the habit of not spending anything for one whole day. So, plan ahead and see if you can go one full day without spending any money!

Find Out What’s Free!

The last idea is to find stuff that is free or figure out how to have fun without spending a dime. From getting books at the library to having friends over for a potluck, to playing tennis on public courts – see if you can come up with a list of stuff you like to do that doesn’t cost money!

Back to the Joneses…

If you were wondering where the phrase “Keeping Up with the Joneses” originated, according to Wikipedia:

“The phrase originates with the comic strip Keeping Up with the Joneses, created by Arthur R. “Pop” Momand in 1913. The strip ran until 1940 in The New York World and various other newspapers. The strip depicts the social climbing McGinis family, who struggle to “keep up” with their neighbors, the Joneses of the title. The Joneses were unseen characters throughout the strip’s run, often spoken of but never shown. The idiom keeping up with the Joneses has remained popular long after the strip’s end.” ²

Interesting, huh?

Speaking of having too much “junk in the trunk” that you don’t need, I can’t help but wonder what Mr. Mormond would think about how his phrase also inspired the name of the popular reality show “Keeping Up with the Kardashians”!

Until next time, figure out how to spend less, forget about the Joneses, and as always…PYMFP!
–Rick

P.S. Wanna know more? Check out the entire book.

Use It or Lose It

Some things to keep in mind for how to spend less that we discussed in this post are:

(1)  Figure out if it is a need or a want.
(2)  Try to spend money only on stuff that you value.
(3)  Nevermind those damn Joneses!
(4)  Use a budget.
(5)  Simplify those bills!
(6)  Reverse budget.
(7)  Wait 30 days.
(8)  Use a list when you shop.
(9)  Don’t go to stores.
(10)  Schedule a no-spend day.
(11) Find out what’s free.

When to Use It

Use these ideas on how to spend less when you want to know how to spend less!

What Do You Think?

Do you use any of these strategies currently for how to spend less? If not will you use any of them? Are there are that you use that we didn’t discuss? Please share your thoughts in the comments below!

References

¹ Do Less: A Minimalist Guide to a Simplified, Organized, and Happy Life by Rachel Jonat

² https://en.wikipedia.org/wiki/Keeping_up_with_the_Joneses

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