In the world of consumption we live in today the thought of living by the
mantra less is more is a far-fetched idea i mean if you don't own at least
three more iphones than your best friend then you're a loser right well let me
tell you that it's true that less can be more for instance less fights with your
partner means more happiness in your relationship moreover less fast food
means more sexy glances from becky at the gym the same principle can be
applied to your money and in this video i'll share with you how financial
minimalism will make you wealthy and if you're new to the channel then hit the
subscribe button below for more life-changing content so first off what
is financial minimalism well there's no official definition for this term the
word minimalism can be defined as a style of extreme simplicity and when
taken in the financial sense it basically just means that your financial
life revolves around what you need and cuts out what you don't for example do
you need to own a few shirts yes do you need to own 50 designer shirts probably
not now beyond cutting down the number of garments in your closet what are some
other ways that people employ financial minimalism in their lives good question
as i just mentioned financial minimalism can be employed in the consumer goods
you buy but it can also manifest in many other aspects of your daily financial
life in fact whenever i talk about saving money i discuss cutting down your
big three expenses of housing transportation and food and financial
minimalism can be applied in these areas of your finances as well for example
when it comes to housing do you really need that 2500 square foot home for just
you and your dog i mean the last time i checked a poodle didn't need a
three-bedroom house to itself by identifying that a two-bedroom apartment
will do you can easily save yourself hundreds of dollars a month while also
still meeting all of your living needs now what about that fancy car over here
sure it feels great to always have a brand new car in the driveway but is it
necessary after about the fifth drive in that car that new car smell will lose
its flare but those massive monthly payments won't cease to sting when the
money leaves your account in this instance financial minimalism would
indicate that a used vehicle will still get you from point a to point b without
the hefty price tag and this is a fact of financial minimalist religion finally
let's talk about food do people who want to live minimalistically eat yes do they
let their eating habits take every penny from their wallet absolutely not for
financial minimalists the reading style is more likely to come in the form of
bulk food prep rather than postmates and dinners out both options will fill you
up but the cost of the two are vastly different now at this point you're
probably thinking that being a financial minimalist sounds extremely mundane i
mean what's the point of making money if you're going to be living in a tiny box
and only eating ramen noodles right well first not everyone takes financial
minimalism to that extreme but secondly to those who have adopted financial
minimalism this way of living feels anything but restrictive and here's why
we live in a world where society places on us the expectation to own as many
things as possible our possessions in effect equal our worth this is why
people who drive around exotic cars get more praise than joe who drives a 10
year old prius alternatively buying the nicest house on your block will have
your family and friends raving about your new place much more than that
responsibly bought one bedroom apartment that would suit the financial minimalist
lifestyle instead unfortunately this false sense of worth that most of us
attach to our material goods is hurting us in many ways first it is making us
strain ourselves to never miss a step on the consumer spin wheel these days over
50 percent of millennials are working side hustles on top of their 9-5 jobs
and while part of this effort is due to stagnating wages and significant rises
and costs of living it's also due to people's fascination with possessing
every material good under the sun this is why you see people still lining up to
get the newest iphone the day it's released even though the new model is
nearly identical to the one they already own however for 99 of people living this
materialistic lifestyle is simply unsustainable even if you have a high
paying job and max out your credit cards there will always be someone else with
more spending power than you who will make your new jaguar look like a lemon
beside their 2021 bugatti it's this realization right here that presents the
first marker of why people who practice financial minimalism obtain wealth
earlier than the average american consumer instead of playing a game they
can't win they unplug from the consumer matrix and instead seek enjoyment from
what they have and not what they hope to have in the future for instance a
financial minimalist will be just as happy if not more happy with two plain
shirts than chad who owns 50 gucci shirts and counting now i'm not saying
that as soon as you adopt financial minimalism that you'll be wealthy i mean
doing so won't drop 5 million dollars in your bank account overnight the first
step towards wealth for those who adopt this practice is the attainment of
feeling wealthy before their bank account supports this fact for example
someone who can happily live off twenty thousand dollars with an income of a
hundred thousand dollars will feel significantly more wealthy than someone
who earns a hundred thousand dollars and spends a hundred thousand dollars now
you may be saying to yourself but i don't want to just be wealthy in my mind
i want more zeros in my bank account as well and this too can be achieved when
financial minimalism is adopted as i pointed out earlier when you adopt a
financially minimalistic lifestyle you will naturally be living much more
frugally it's pretty obvious that owning a mansion versus a one-bedroom apartment
will have you paying two very different mortgage payments and these savings will
appear in all aspects of your finances once you learn to live off less however
one cost that many people overlook and that may be the most important for
building monetary wealth is the opportunity costs a financial minimalist
sidestep by adopting this particular way of living now if you're unfamiliar
opportunity cost is a benefit given up when another alternative is chosen for
instance staying out late and getting blackout drunk comes with the
opportunity cost of having a productive morning the next day in a more
consumer-centric example of buying that 50 000 boat means giving up an
opportunity to acquire another rental property unfortunately in life you can
have your cake and eat it too and opportunity cost is a great example of
this being the case however guess what happens when you stop living your life
with the sole purpose of owning every material good ever made that's right you
stop and create these opportunity costs for example since you didn't buy those
designer shoes you didn't give up the chance to save money this month spend
money on a course or buy a shelf's worth of new books as you're probably coming
to realize financial minimalism is simply about allocating your resources
in a less consumer-centric way and this is powerful when it comes to your wealth
creation efforts as you can imagine when you are blowing every last penny that
you have on useless material items you'll have more money to save and
invest for most people investing for the long term is the only way they will ever
achieve real levels of wealth and they can thank their friend compound interest
for that pleasure however when often overlooked way that financial minimalism
will contribute to your overall wealth is by giving you back time that you
wouldn't otherwise have if you were in a constant spending frenzy as i mentioned
earlier a ton of people these days are working two or more jobs and many of
these circumstances are due to people trying to keep up with their poor
spending habits fortunately when you adopt financial minimalism you unlock
precious time that you would otherwise not have access to which is wealth in
itself if you ask me however in a more practical sense this time gained back is
half of your wealth building pie we just talked about having cash as being a way
to generate significant wealth through regular investing but you should be
putting your abundance of time towards making more money as well this means
that instead of being forced to work more overtime at your dead-end job or
working part-time for minimum wage you can instead spend time on a side hustle
or business that will allow you to take your income to the next level whether
you realize it or not those who become wealthy and those who don't only have
one thing in common how they allocate their two most important resources of
time and money by adopting financial minimalism you will instantly gain
access to more of both which is why it is such a powerful wealth generation
tool that anyone can employ so now you know that financial minimalism can
streamline your wealth right you may even think that it sounds perfect in
every single way but i can tell you it isn't sure being a financial minimalist
will allow you to live more simply and have access to more money than you've
probably ever had before but as the saying goes without sacrifice there is
no progress and unfortunately many people take this idea of sacrifice a
little too far we see this mistake being made all the time in the financial
independence retire early community where people are enticed to live off as
little as they can in an attempt to retire at the earliest age possible as
such they wear rugged clothes shower once a week and refuse to get around by
any other means than on foot now i am all for saving money but when i have to
sacrifice my personal hygiene to get there one must reconsider the cost of
their actions and this is where the imperfections of financial minimalism
come to light many people who are striving to make the most financial
progress in the shortest period of time often give up everything in their
day-to-day life to get there they cut out that coffee date with that cute girl
at work or they push off a family vacation until they have at least 250
000 in the bank sadly that girl isn't going to wait around forever and your
opportunities to vacation with your kids will only last so long which is why
financial minimalism needs to be met with some sensibility should you still
prioritize living simply yes but not at the cost of giving up all enjoyment in
your day-to-day life so the final question we need to answer here is how
do you maximize financial minimalism to achieve all of your financial
aspirations without ruining your lifestyle in the process here's what i
suggest first gain an appreciation for what material goods in your life
actually bring you value and which don't for me having a home gym allows me to be
self-reliant when it comes to meeting my health goals and saves me a ton of time
commuting so this is a purchase that makes sense for me however buying an
expensive car that would only cause me hard palpitations when i bring it to the
dealership for repairs isn't where i feel my money is best used taking some
time to assess your spending values will allow you to start to craft a spending
plan that makes sense for you then once you cut out all of these unnecessary
expenses ideally you'll have more access to the two core resources that are
required for wealth generation time and money with your time you need to be
using it to learn and grow more specifically since you should have
saving down pat at this point you want to learn how to earn more money whether
that's getting ahead at your job starting an online business or
developing a skill you can use as a well-paid freelancer then when you
continue to gain access to more money the final step is to move as much of
that money into assets that will grow your wealth over time assets like real
estate growth stocks index funds are all vehicles for wealth creation that you
must use to get ahead because simply saving alone won't do it at the end of
the day adopting the financial minimalism lifestyle is about two things
first it's about detaching from the consumers and mindset that plagues most
people which in turn will naturally allow you to feel more financially
abundant second it's about freeing up more cash to put towards your future
wealth goals therefore when done right becoming a financial minimalist will
have you feeling wealthy now and being wealthy in a matter of time hey it looks
like youtube thinks this next video is the one that will change your financial
life forever give it a watch and let's see if they're right