Seven Ways Minimalist Living Can Save You Money
The following is a guest post from Megan, the Managing Editor at DollarSprout
When I first adopted a minimalist lifestyle, my only goal was to clean out my closet and declutter my bedroom.
I had just graduated from college and landed my first full-time job. And with an adult job came the need for a new adult wardrobe.
I’d saved up some money specifically for this occasion, so fitting it into the budget wasn’t the issue. The problem was figuring out where to put my new clothes once I bought them.
My closet at the time was packed with shirts, dresses, and sweaters — most of which I never even wore. I was out of hangers, and each laundry day felt like a game of Tetris trying to arrange every piece perfectly in hopes that the door would eventually close.
I was somewhat of a hoarder when it came to clothes. Most of the T-shirts that used to crowd my drawers were from my middle school and high school track days. After years of fighting to tame my ever-growing wardrobe, it was time for a change.
I spent the better part of a weekend stuffing boxes and trash bags with old clothes and hauling them off to the local YMCA. After it was all said and done, I was surprised the difference, not just physically, but mentally. I hadn’t realized the amount of anxiety and mental clutter my clothes were causing me.
Cleaning out my closet led to decluttering my entire bedroom. From there, it was the bathroom, the kitchen, the living room. The next thing I knew, I was cleaning out my entire house.
Some of the benefits were immediate. I felt less stressed, more at peace, and less consumed by the things I owned.
However, I had no idea how much of an impact a minimalist lifestyle would have on other areas of my life. Namely, my finances.
What is Minimalist Living?
Most people think of minimalism as paring down your wardrobe, living in a monochrome world of black furniture and white walls, and wearing the same style of clothing day after day.
However, minimalism isn’t actually about decluttering at all.
According to The Minimalists, “Minimalism is a tool to rid yourself of life’s excess in favor of focusing on what’s important — so you can find happiness, fulfillment, and freedom.”
In other words, the idea behind minimalist living is to be more intentional. It’s about allowing space for the things that really matter to you and eliminating the ones that don’t add value to your life.
How Minimalist Living Benefits Your Wallet
For most people, minimalism starts out on a more superficial level — cleaning out the closet, decluttering the kitchen, downsizing to a smaller space.
What most don’t realize is that the benefits of minimalist living go far beyond having a clean, clutter-free house. One of the most rewarding aspects of minimalism is the positive impact it has on your bank account.
Value Experiences Over Things
Minimalism encourages you to focus on what’s important to you. When you stop and think about it, you’ll probably realize that traveling, spending time with friends and family, and having new, fun experiences are far more valuable than living in a big house or driving the nicest car.
Once you have this realization, your spending naturally shifts. It’s no longer a question of whether or not you should buy those designer shoes or that expensive pair of earrings. You’d rather continue saving for your next big excursion instead.
Recognize Needs vs. Wants
The average American household spends over 90% of their annual income. A large portion of that spending goes towards things we don’t need — at least in the quantities we consume — such as in-home entertainment systems, dining out, and new clothes.
Minimalist living helps you identify what’s essential in your life and what’s excessive. As a result, you’ll start to recognize and eliminate spending that doesn’t align with your values.
That’s not to say you can’t spend money on the things you want. You’ll just have a clearer picture of the wants that add value to your life and the ones that don’t. For example, eating out alone because you don’t want to cook versus having dinner with friends, or buying a new car versus saving up for an international vacation.
Quality Over Quantity
Before minimalism, I was notoriously cheap. Fast fashion was my way of life, and I was always looking for the best deal on every purchase, even if it meant sacrificing quality.
Now that I have fewer things in my life, each one is more important than when I had more. Buying fewer high-quality items not only decreases my waste; it also helps me save money in the long run.
For example, I used to buy $25 tennis shoes. While they seemed like a great deal at the time, they would only last six months to a year before I had to replace them. Not to mention, they weren’t all that comfortable, to begin with.
The tennis shoes I have now cost five times as much as my old ones, but they’ve already lasted six times longer and they’re far more comfortable on my feet.
Minimalist living helps you view spending from a different perspective. Rather than getting the best deal today, it’s about finding the product that meets your needs and adds the most value to your life. More often than not, this quality over quantity mindset saves you money in the long run.
Fewer Things Means Less Space
An obvious benefit of downsizing your belongings is decreasing the amount of space you need to keep your stuff.
Considering nearly 1 in 10 Americans rents self-storage space, almost 10% of the country could save money in this category alone.
Additional storage aside, fewer belongings also means less square footage needed in your home. I’m not suggesting you move into a tiny house, by any means. However, consider how much money you could potentially save by giving up even a few hundred square feet.
…and Lower Maintenance Costs
When you only own things that add value to your life, you feel more compelled to take care of them. As a result, they last longer. That means less time and money spent on maintaining and replacing your belongings.
One example of this is laundry. I used to look for the cheapest clothes I could find. But just like everything else, cheaper clothes usually means lower-quality material. Many times I bought a new shirt just to wash it once and find it was already fading or pilling.
Now, rather than spending $15 each for 5 different shirts, I regularly pay $80 or more on a single shirt. Instead of 50 cheap shirts, I have 5 to 10 quality ones that I love.
I’ve found this saves me money in two ways. First, my clothes last longer, and that in itself lowers the overall cost of updating and maintaining my wardrobe. On top of that, I spend a lot less time looking for new clothes. I can then use my extra time to work on other things, like growing my business or making money with one of my side hustles.
Pay Off Debt Faster
When you start to value experiences over possessions, recognize your needs vs. wants, and invest in quality over quantity, a natural byproduct is more money in your bank account.
This is especially good news if you’re in debt. You can take all the savings minimalist living affords you and use it to accelerate your debt payoff plan.
That may not sound like the most exciting thing to use your extra money for, but think about the snowball effect. When you pay down your debt sooner, you save on interest and eliminate your monthly payments. Without those monthly commitments weighing down your checking account, you have less stress and greater freedom with your money.
You also have the option to invest a significant portion of your income. The earlier you start investing and the more you have to invest, the more you’ll benefit from the effects of compound interest.
Saving Money Becomes Easier
For many people, saving money sounds about as pleasant as stubbing a toe on the coffee table. When you practice minimalist living, however, saving money becomes a way of life.
You hardly even have to try. Without the compulsive need to spend, money begins to pile up in your bank account. You know your priorities and would rather save up for the next grand experience or meaningful purchase than blow your cash for instant gratification.
Minimalist Living is More Than Decluttering
When I first jumped onto the minimalism bandwagon, I had no clue what I was in for. For many people, myself included, it starts with decluttering and downsizing. However, the mental, spiritual, and financial benefits are a huge, often unexpected bonus.
First, you’re decluttering the bedroom, and the next thing you know you’re making your last debt payment or saving up for your dream vacation. Minimalism has changed everything for me, from my relationships to my wardrobe to the amount of money in my savings account.
Who knew all that could come from cleaning out your closet?