Minimalism For People in Debt

Can Changes in Lifestyle Help Me Stay Out of Debt?

Whether you’ve accrued debt due to living beyond your means or as a result of a medical or other emergency, looking at your spending habits is a good way of beginning the journey to both paying down debt and being free of debt for good. We know that having a debt payoff plan is the most beneficial tool for attacking your debt.

One useful tool to making a payoff plan is the practice of minimalism. A minimalist approach to getting out of debt not only helps you stick to purchasing only those items you truly need or want instead of mindlessly spending, but it also helps you not to mindlessly save. In our desperation to pay down our debt we can sometimes be too ruthless with our budgets and deprive ourselves of things that are important to our happiness. This can cause us to throw our budgets out the window as we mindlessly buy things to make ourselves happy again. Minimalism can teach you to instead know why you are spending the money you spend, thus arming you the freedom and knowledge to make better budgetary and financial decisions.

What is a Minimalist Lifestyle and How Will it Help with Debt?

Minimalism is a lifestyle practice whose purpose is to help individuals focus on what is most important in their lives by helping them to rid themselves of distraction and unnecessary consumer spending. In other words, minimalists search for happiness through life and experiences rather than through things. While selling your 2-bedroom house and living in a studio might not be the answer to your budget or debt issues, there are certainly many minimalist tricks and tips that you can use to pay down your debt and become debt-free.

Since minimalism is a practice, not just a strategy, there is a bit of a mindset change needed to begin your minimalist journey to becoming debt free. The most important step is to understand where your priorities lie in your life so that you know what is most essential for your personal happiness and what you can do without. Here, minimalism doesn’t promote getting rid of all your things just to own less things. Rather, it shifts our purchase patterns toward those items that truly bring value to our lives.

How to Pay Down Debt with Minimalism

The first step is to analyze your spending habits. Part of this is understanding where you are spending money needlessly. Another part of this is to analyze the thought patterns behind your spending, because (unless your debt is due entirely to unforeseen medical or other emergency expenses), it is due in part to these spending habits.

The second step is learning to budget. You’ve already done the hard part of figuring out what you spend, now it’s time to see how what you will continue to spend your money on and what you can live without. You don’t have to do without everything at the beginning, but the more you get rid of the things you find you can live without, the easier it is to live with less.

The third part is simplifying your finances. Try to close down all your unnecessary accounts (such as unnecessary credit card accounts). Pay for everything with cash so you can avoid the mindlessness of using cards. Actively knowing what you want, how it fits into your life values and how much you are spending relative to your budget will help free you from financial burdens. Spending money on only the things that are truly important also helps you to enjoy your purchases more because you know you didn’t waste your money.

Look for Help

Sometimes you’ve just really overdone the spending and it becomes necessary to consult with someone to help you gain control of your finances and to keep your head above water. This is a good time to reach out to CreditGUARD for your financial questions and any questions or tips you might need about financial literacy.