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Minimalism and Finances

How Embracing Minimalism Can Help Your Finances

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“Sometimes, Less is More.” – William Shakespeare

Having something that you can call your own is liberating. It gives you a sense of pride and accomplishment. But what happens when your possessions start to possess you? When do the things you own end up owning you? That’s when it’s time to consider minimalism.

Minimalism is more than just a trendy aesthetic choice — it’s a lifestyle. And it can have a profound effect on your finances. It is a movement based on the idea that by owning fewer things, we can live more deliberately, with more intention and purpose.

When it comes to your finances, being a minimalist means taking a hard look at your spending habits and evaluating what is truly important to you. It means learning to live within your means and making choices that align with your financial goals.

Here are some ways that minimalism can help your finances:

Makes You Prioritize What’s Really Important

When you adopt a minimalist lifestyle, you automatically become more selective about the things you allow into your life. You take the time to consider whether something is truly worth your money, time, and energy. This process of mindfulness can carry over into your finances, helping you to focus on what is truly important to you.

By allowing yourself to realize that you can live without certain things, you can start to see what is really important to you. From there, it becomes easier to set financial goals that are in line with your values and priorities.

Limits Your Needs For Material Things

Shopping, new bags, shoes, and the latest gadget. It can be all too easy to fall into the trap of thinking that you need these things in order to be happy. But the truth is, you don’t need any of them.

While there’s nothing wrong with treating yourself to a new purchase now and then, minimalism can help you to see that you don’t need material possessions to be happy. When you focus on experiences instead of things, you can start to see your finances in a new light.

By having limits on expenses that are not really important, you can start to save more money and have less debt, if you have any.

Allows You to Focus on Your Financial Goal

Budgeting is the first thing you’ll learn or improve when you become more financially focused. When you have clarity about your goals, it becomes much easier to allocate your resources accordingly.

But what if you don’t have a clear financial goal? That’s where minimalism comes in.

Minimalism can help you to focus on what you really want in life. Once you know what that is, you can start to work on a plan to achieve it. This focus will carry over into your finances, helping you to better manage your money and make choices that are in line with your goals. It also helps you see areas where you can handle your money better.

Getting Out of Debt

A debt-free life is a goal for many people, but it can be difficult to achieve. If you’re struggling with debt, minimalism can help. By learning to live with less, you can free up more money to put toward your debt. You can also use the extra money to build up an emergency fund, so you’re less likely to fall back into debt in the future. Without debt, you can actually save up and travel once in a while, take a time off of your work to reset, or just enjoy a better quality of life. Moreover, exploring other things and doing things that make you happy will give your life more meaning and focus. Thus, your emotional health will also improve.

Declutter the Things that You Don’t Need

There’s too much stuff in the world. And a lot of it ends up collecting dust in our homes. If you’re struggling to declutter your home, it can be helpful to think about what you really need. Not what you want, but what you actually need. Try selling those things that you don’t need or use anymore. You can also donate them to charity. This decluttering process can free up both physical and mental space in your life, making it easier to focus on what’s important.

It can also help you save money as you can use the money you make from selling your things to pay down debt or save up for an emergency fund or maybe fund a trip that you’ve been wanting to take. A yard sale can be a good start to decluttering your home and making some extra cash. Online marketplace platforms like eBay, Facebook Marketplace, and Craigslist can also be used to sell things that you don’t need anymore.

Minimalism Helps You Manage Your Finances Easier

By learning to live with less, you can get a better handle on your finances. When you have fewer things, you have less to worry about and less to take care of. This can help you save money as you won’t have to spend as much on things like repairs, replacement, and upkeep.

It can also help you to focus on your financial goals and better manage your money as well as a good start to budgeting. When you’re not constantly bombarded with material things, it’s easier to make choices that are in line with your goals. You can also start to see areas where you can cut back on your spending and save more money.

Spend time and research some applications that can help you automate and keep track of your finances. This way, you can easily see where your money is going and make changes accordingly.

Minimalism Makes Helping Easier

By recognizing what you can give and how much you have, you can help others more. When you live a minimalist lifestyle, you tend to be more aware of your possessions and how much you have. This can help you to be more giving as you’re not as attached to your things. As you shift your priorities and focus on what’s important, you can start to see where you can make a difference in other people’s lives.

Final Thoughts

Minimalism is a way to develop focus and intentionality in every area of your life. It can help you to better manage your finances, declutter your home, and free up time and energy to focus on things that are truly important to you. For those who are burdened by debt, minimalism can be a way to get out of debt and improve your quality of life. It’s also a way to help others as you become more aware of your possessions and learn to be more giving.

Your financial health is critical to your overall well-being. Be mindful of your spending, save up for emergencies, and make a plan to get out of debt.

About the Author

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Rick Munster

Rick Munster is a personal finance expert and author with over 21 years of experience in the credit counseling industry. He currently serves on the board of directors for the Financial Counseling Association of America and has written over 200 articles on personal finance. Rick's expertise has been recognized by several prominent online organizations, which have quoted him on issues related to credit counseling, debt management, and financial education. With more than 20 years of experience at Money Fit, a non-profit credit counseling organization, Rick has established himself as a trusted authority in the field of personal finance.
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  1. Services: DRS provides the following housing-related services: counseling that includes Homeless Assistance, Rental Topics, Pre-purchase/Homebuying, and Home Maintenance and Financial Management for Homeowners (Non-Delinquency Post-Purchase); Education courses that include Financial literacy (including home affordability, budgeting, and understanding use of credit), Predatory lending, loan scam or other fraud prevention, Fair housing, Rental topics, Pre-purchase homebuyer education, Non-delinquency post-purchase workshop (including home maintenance and/or financial management for homeowners), and other workshops not listed above.

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Disclosure to Client for HUD Housing Counseling Services

Debt Reduction Services, Inc. and its financial education arm, Money Fit by DRS, offer the following housing counseling and educational services related to housing, personal finance, and bankruptcy certificates to consumers:
  • Housing Education Courses: DRS offers many online self-guided education programs classified as Financial, Budgeting, and Credit Workshops (FBC), Fair Housing Pre-Purchase Education Workshops (FHW), Homelessness Prevention Workshops (HMW), Non-Delinquency Post Purchase Workshops (NDW), Predatory Lending Education Workshops (PLW), Pre-purchase Homebuyer Education Workshops (PPW), and Rental Housing Workshops (RHW). These courses help participants increase their knowledge of and skills in personal finance, including home affordability, budgeting, and understanding the use of credit, as well as predatory lending, loan scams, and other fraud prevention topics, fair housing, rental topics, pre-purchase homebuyer education, non-delinquency post-purchase topics including home maintenance and/or financial management for homeowners, homeless prevention workshop, and other workshops not listed above relating to personal finance and housing. Course details are found below under “Housing Workshops.”
  • Home Equity Conversation Mortgage (HECM) Counseling (RMC): Via telephone and virtual platforms, we offer the required HECM counseling nationwide in addition to in-person counseling in Boise, Idaho. We also offer in-home counseling options in thirty counties across southern Idaho for an additional fee to cover our travel and additional staff time costs.
  • Home Maintenance and Financial Management for Homeowners (Non-Delinquency Post-Purchase) (FBC): Clients receive counseling and materials on the proper maintenance of their home and mortgage refinancing. Clients can find help and resources by phone, in our Boise office, or virtually on all topics related to stabilizing their long-term homeownership.
  • Services for Homeless Counseling (HMC): Clients receive phone, virtual, or in-person (Boise) counseling to evaluate their current housing needs, identify barriers to and goals for housing stability, establish a path to self-sufficiency, and connect with emergency shelters, income-appropriate housing, and/or other community resources (e.g. mental healthcare, job training, transportation, etc.).
  • Pre-Purchase Counseling (PPC): Clients receive counseling through the entire homebuying process. Assistance may involve creating a sustainable household budget, understanding mortgage options, building their credit rating, and putting together a realistic action plan to set and achieve homeownership goals.  Additionally, clients will receive materials and resources about home inspections and other homeownership topics relevant to successfully maintaining a home.
  • Rental Housing Counseling (RHC): Via phone, in-person appointments (Boise, ID), or virtual platforms, clients receive housing counseling relevant to renting, including rent subsidies from HUD or other government and assistance programs. Topics can also address issues and concerns having to do with fair housing, landlord and tenant laws, lease terms, rent delinquency, household budgeting, and finding alternate housing.
DRS also offers the following services:
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Through such services, DRS has established financial relationships with hundreds of banks, credit unions, and creditors such as American Express, Bank of America, Barclays, Capital One, Chase, Citibank, Credit One, Discover, Synchrony, US Bank, USAA, Wells Fargo, and others.

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The client is not obligated to receive, purchase or utilize any other services offered by DRS or its exclusive partners to receive financial education or housing counseling services. Alternatives: As a condition of our counseling services, in alignment with meeting our client services goals, and in compliance with HUD’s Housing Counseling Program requirements, we may provide information on alternative services, programs, and products available to you, if applicable and known by our staff. Alternative DMP services include negotiating better repayment terms directly with your individual creditors, paying your debts as agreed, or, in extreme cases, filing for personal bankruptcy. Alternative credit and education services can be found through MyMoney.gov or the Jump$tart Clearinghouse of online financial education resources. Housing counseling alternatives can be found through HUD at www.hud.gov/findacounselor.
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Housing Counseling and Education Fee Schedule

 

Online Education Program Fees*

Homebuyer Education Course: $59 per participant

  • Self-paced course available here, our online housing counseling and education center. Certificates will be automatically generated upon completion of the course (approximately 6-8 hours)

Rental, Fair Housing, Predatory Lending / HOEPA, Post-Purchase (Non-delinquency post-purchase workshop, including home maintenance and/or financial management for homeowners) Online Workshops: $49 per participant

  • Approximately 1 hour each

Other Self-Guided Financial Literacy Webinars (e.g. credit, budgeting, homeless prevention, debt prevention): $0

One-on-one Counseling Fees*

Pre-purchase Homebuying Counseling, Rental Counseling, Post-purchase Ownership Maintenance and Financial Management: $75

  • Session by the hour

Reverse Mortgage/HECM Counseling with Required Certificate:

  • $200†

Credit Report Fee: Paid Directly by Client

*Fees for all but our online education courses and workshops can be paid online by debit card, credit card, or PayPal or in person by cash, check or money order to: “Debt Reduction Services, Inc.” Registration fees are non-refundable 24 hours or less before the start of an in-person course or workshop. Certificates are non-transferable

*Fees may be waived for households with income of 150% or less of that identified on the US Department of Health and Human Services Poverty Guidelines Page

†Home visit counseling is available in 30 southern Idaho counties for potential HECM borrowers at additional costs to cover our travel (IRS reimbursement rates apply) and staff time ($50 per hour or fraction there).

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Housing Counseling and Education Fee Schedule

 

Online Education Program Fees*

Homebuyer Education Course: $59 per participant

  • Self-paced course available here, our online housing counseling and education center. Certificates will be automatically generated upon completion of the course (approximately 6-8 hours)

Rental, Fair Housing, Predatory Lending / HOEPA, Post-Purchase (Non-delinquency post-purchase workshop, including home maintenance and/or financial management for homeowners) Online Workshops: $49 per participant

  • Approximately 1 hour each

Other Self-Guided Financial Literacy Webinars (e.g. credit, budgeting, homeless prevention, debt prevention): $0

One-on-one Counseling Fees*

Pre-purchase Homebuying Counseling, Rental Counseling, Post-purchase Ownership Maintenance and Financial Management: $75

  • Session by the hour

Reverse Mortgage/HECM Counseling with Required Certificate:

  • $200†

Credit Report Fee: Paid Directly by Client

*Fees for all but our online education courses and workshops can be paid online by debit card, credit card, or PayPal or in person by cash, check or money order to: “Debt Reduction Services, Inc.” Registration fees are non-refundable 24 hours or less before the start of an in-person course or workshop. Certificates are non-transferable

*Fees may be waived for households with income of 150% or less of that identified on the US Department of Health and Human Services Poverty Guidelines Page

†Home visit counseling is available in 30 southern Idaho counties for potential HECM borrowers at additional costs to cover our travel (IRS reimbursement rates apply) and staff time ($50 per hour or fraction there).