“The way to build your savings is by spending less each month.”
– Suze Orman
You may have become interested in minimalism after hearing how you can save money by simplifying, but found your savings aren’t mounting up as you expected or that you’re not able to pay off debt as you planned.
Unfortunately, decluttering alone doesn’t do the trick. So, how can you save money by simplifying?
1. Declutter enough to stop renting a storage unit, move to a smaller home and/or rent out extra space in your home.
2. Make sure you update your insurance policies if you no longer have expensive items you insured separately (on a rider) or if the total value of your possessions has significantly decreased.
3. Eat and drink more simply. Eat out less, and try eating more “real food” and fewer processed foods. Drink more water and less soda, coffee, milk, juice, sports drinks, tea and alcohol.
4. When it comes to holidays and other gift-giving occasions, give of your time instead of your cash.
5. Make it yourself. Homemade cleaning solutions are cheaper and greener.
6. Exercise simply and cancel your gym membership.
7. When deciding which activities to cut back on to give yourself more free time, consider the expense. This includes not only fees, but also necessary clothes as well as the cost to get there (gas, bus fare).
8. Invite friends and family over for a potluck instead of going out.
9. If you sell items as you’re decluttering, earmark that money to pay debts or go into your savings account – do not treat it as fun money.
10. Spend less overall. Don’t just buy less stuff. If you go out to dinner with the money you saved from not buying a new book, you won’t save money by simplifying. [I’m not saying you shouldn’t spend on experiences instead of stuff; studies show that spending on experiences can make us happier. Just that if saving money is your goal, you must focus on spending less.]
If you’re interested in more structured plans for budgeting and saving money, visit your library for books by Dave Ramsey, Suze Orman and other personal-finance gurus. Skim through a few books by different authors until you find an approach that fits your lifestyle and personality.