While everyone needs to consider the larger issues of their financial futures, I am going to address the immediate issues which will make it easier for you, in time, to deal with the larger issues. Here is a very helpful article on the deeper financial issues that must be addressed once you are out of daily damage control mode.


Partner Up: Things Are Easier When Done With Someone Else

Sit with your spouse or partner.  If you are single, find a friend who also has long range hope for their future and who want to change their lives for the better. Go over each of the items below.  If you are mates, and your income and spending habits are linked, make sure you are on the same page.  Bottom line, partnering up, just like with workouts, creates accountability and camaraderie.

Reality Check: Discover Your True Net Worth

It’s incredibly basic and overly simplistic…but it’s a start and it’s an accurate representation of where you are financially … Grab a piece of paper and make two columns.  On the first, label it “ASSETS”.  List everything that you own…house, furniture, car, savings, … and the worth of each item.  On the second column, label it “LIABILITIES” and list how much you owe for each of the items from list one.  Also, list any debt not represented and which is owed to personal loans, credit cards, school loans, etc….  Now, deduct all liabilities in column 2 from your assets in column 1.  This is your current worth.  For most people, this is abysmal news.  But, you know what?  You need it…you need this reality check so that you can start living proactively.  You need to take a long look at your immediate financial picture.  Don’t get depressed; it’s counterproductive to be angry with yourself.  Rejoice that you are taking action. Think of ways you can make the columns a bit more pleasing.  Can you trade that sports car in on a more reasonable car with low mileage but which won’t take half of your monthly salary to pay installments and repairs?  Can you eliminate future debt by cutting up the credit cards or, as used to be recommended, freeze them in a tub of water so that using them is no longer a spontaneous act? Can you negotiate lower interest rates on these cards/combine debt onto one low-interest card?  Think of other ways that you can start eliminating the reality of column 2 so that column 1 becomes something in which you can find peace.


Don’t Try To Keep Up With The Joneses: Become The Joneses

One of my favorite bloggers is Joshua Becker and his blog is Becoming Minimalist.

His journey started nearly a decade ago living with enough.  On his blog post “The Journey Begins”he states, It all started harmless enough on a spring Saturday morning as my 5-year old son and I went to clean the garage. The neighbors happened to be outside planting gardens, watering flowers, and tending to the outside of their two-level home.

Nearly three hours later, we were still working on the garage and the neighbors were still outside working on their home. My neighbor turned to me and said sarcastically, “Ahh, the joys of homeownership.”  I responded by saying, “The more stuff you own, the more your stuff owns you.”  Her next sentence struck a chord with my soul. Her response was, “That’s why my daughter is a minimalist. She keeps telling me that I don’t need all this stuff!”

“A minimalist?” I thought. “How attractive, how freeing – I want that in my life.”  Please read the rest of his post here and check out the ensuing stories of his family’s pursuit of simplicity and “enough” along with his multitude of posts of how to achieve this lifestyle.

A client of mine once lived a life with the Mercedes, Hummer, brand new Jeep, and Suburban in the driveway of her multi-million dollar home (one of three).  She and her husband’s lives were mortgaged up to the hilt and he worked 16 hour days while she, alone, tended to the children.  When they took trips, they were business trips she happened to be “allowed to attend”; never family vacations. Eventually, her husband strayed and she stopped caring.  They divorced and subsequently lost everything.  Caught in the midst of this loss was the confusion of the children who had absolutely no idea why their world and way of life was changing.  

Which of these two families would you rather be?  If you lived in a home between the two, which would you be more envious of?  If you’re reading this website…this blog…this very post, my guess is the minimalist that lived with peacefully  “enough”.  Become that family.

finances - minimalism, collect moments

Check Your Mindset: Let go of Any Unhealthy Childhood Concepts of Money

I once had a client who grew up in a family with a strict religious (operative word) mindset.  “Money is the root of evil”…When, in reality, it’s the LOVE of money that is at the root of many evil deeds.  Regardless, she grew up believing that it was honorable to eschew money which made her live without…without needed items…without goals for her future (financial and career as well as desire and enjoyment).  I had another client who also grew up without…without adequate clothing…food…and love.  When she grew up and was able to make a nice salary, instead of saving for the future, every month she blew her money on needless items.  There was a high with every purchase followed by the depression associated with regret.  She was trying to fill a void that was, in reality, an endless pit.  Neither is a healthy approach…living without and living with too much is not living in peace.

Money Drunk book

Develop healthy concepts of money and what it takes to make your life run smoothly and without stress (stress of living without/stress with living too much).  Although it was originally published in 1999, Money Drunk by Julia Cameron and Mark Bryant is still one of the best books on the subject.  The jacket of their book reads:In a society where it is often easier to discuss sex than money, many of us have hidden issues about personal finances. But when fending off bill collectors, begging for salary advances, or borrowing from relatives becomes a way of life, unresolved money problems can lead to enormous stress and destroy relationships, careers, and lives. Do you recognize yourself or someone you love in any of these descriptions?


Do you buy things and hide them?


Do you refuse to watch your money because one big deal is going to make everything all right?


Is the pay the only thing you like about your job?


Do you feel morally superior to people with money?


Are you afraid to say no to your partner about money?


Through their highly effective seminars, Mark Bryan and Julia Cameron have helped many people free themselves from the painful cycle of acting out with money. The Money Drunk offers new perspectives on the real roots of money problems, showing how to dismantle negative family and societal programming about money and how to undo the destructive patterns that sabotage your financial success. The program teaches new, more constructive habits to anyone who has ever had a problem with money.”

finances - minimalism, Thoreau

Invest In Your Future:  HINT…You Are Your Future

Sit down and realistically look at what you want your life to look like.  Make lists, draw pictures, design a vision board.  Does it look like CONTENTMENT…peace, contentment, experiences, freedom?  Does it look like relaxation and adventure in retirement?  Or, does it look BLEAK….long hours paying interest on credit cards for items you’ve long donated, lost or broken?  Does it look like potentially dying or living incapacitated before you were able to retire?  Does it look like losing your home because the market took a downturn and you couldn’t keep up?  Realize that, if your reality is pushing you toward the latter picture, you need to change NOW.  If your desired life looks like the former and filled with contentment, are you on that road?  If not, as with “bleak” change your ways now, implement these rules.


Squirrel Away Three Months Worth of Nuts: Monthly Bills x 3 Brings Peace of Mind

One of my clients spoke of how they had learned early on to make sure, regardless of IRAs, retirement accounts, etc… the one thing they were supposed to always keep close at hand is a liquid bank account with enough funds to cover at minimum 3 mos of expenses (6 mos is preferable).  In fact, many rental agencies these days will not lease to you unless you can prove a net income of at least 3 times the amount of monthly rent for the unit.  This is a good rule of thumb and should be extended to having three months of these monthly expenses readily available.  This liquid account should be your goal before any vacations, new cars, large purchases, etc… are ever considered beyond planning as a future desire.

finances - minimalism, 85 years

Change Makes Progress:  Reevaluate Your Budget Every Month or Two

At the beginning of this next month, put an envelope in your car and one in your purse/briefcase or on your nightstand.  Every single day, with every single purchase, put the receipts in these envelopes.  As you put them in, make sure it’s visible if it was cash, check, credit card, or ATM.  At the end of the month, sit down with a stack of the bills from the month as well as these receipts.  Evaluate your expenses for the month and your purchases.  Compare this to your net income for the month.  This will help you come up with a realistic monthly budget as well as make you realize that the five $5 lattes you have throughout the week might not be the wisest way to spend $100 for the month.  Once you come up with a budget that you can live with, reevaluate every few months.  New expenses may come up that are necessary.  Alternatively, you might have switched out that daily latte habit for something equally as unnecessary and costly.  Nip that in the bud.


Freedom To Live With Enough: Giving Away Things Make Us Free

Again, I can’t help but recommend Joshua Becker’s blog on living a minimalist life.  If you haven’t read my blog posts on decluttering your home/life and decluttering your mind, do read them.  They are necessary steps to financial freedom that occurs when you realize you don’t need to keep overspending and to giving you steps to living a life of organization, peace, and contentment.  Additionally, if you are like most of my clients, most of the things that you don’t need…that you’d be fine giving away…are in perfect condition.  The relief at ridding yourself of these unnecessary items will go hand-in-hand with the great feeling of knowing that you are helping someone who is in need….even if that’s you by selling the items and putting them into your “squirrel account”.

finances - minimalism, lemons

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