By Tiffany Bass Bukow, Founder of MsMoney.com
After years of running an entrepreneurial startup, I realized that my life was out of balance. When 90% of your waking hours are spent working or thinking about work, something has to give. So I decided to simplify my life and things transformed dramatically in a short amount of time.
If I had to give one bit of advice on the secret to success I would have to say it is LIVING SIMPLE.
You might ask what that means – “to live simple”. It means eliminating the clutter in all areas of your life. For me it meant, making my work life simple, my home life simple, my social life simple and most importantly – my financial life simple. Once your financial life is simple, everything else seems to fall into place.
The reason that I created Ms. Money was to give women the financial education they needed so that they could fulfill their goals and dreams. I wanted to present financial information in a simple way so that anyone could reap the benefits. I know firsthand, that unless you have financial security and your basic survival needs filled, it is difficult to reach for the stars.
Now I am not saying that simplifying your financial life is a simple task. For most of us it is not. This is the reason that many women dread taking financial control and often put it aside for years or sometimes decades. What many women don’t realize is that the sooner they take care of this matter, the sooner they will be able to live more fulfilling lives and transform their dreams into reality.
Ms. Money offers the basic knowledge that women need to get started making their financial lives simple. We even created a special seminar for women to help them begin the process. It is called 6 Steps to Reach Financial Security.
Amazon has 134 books on living simple. There are also new magazines such as “Simple Living.” This new trend is a response by society to the overwhelming chaos caused by today’s active living. Hopefully it isn’t just a trend but a new standard for living in the third century.
I can’t extol the benefits of simple living enough. It has changed the way I view the world and has tripled the amount of free time I have for leisure and to pursue joyful activities. My recommendation is to analyze your life as it currently is and see if there is something in your life that is more complicated that it needs to be.
I spent time analyzing my life and it’s organization and I have included samples where I knew I had a simplicity problem. Kitchen: Did we really need to have 3 pizza cutters? Does this food processor even work? Storage Closet: What are we doing with 14 suitcases and carry bags? Why do we have 175 miscellaneous screws and random tools? Bathroom: Why do I have 7 different types of shampoo? Is it necessary to store 50 razors? Why do we have 30 towels? Wardrobe: Do I need to have 12 cotton short sleeve shirts all in a different color? When is the last time I wore that pleated skirt? Do I still fit into those pants? Personal: Why am I reading 4 magazines on the same topic? Why do I have all these trinkets on my shelves? Misc: Why do I have my music CD’s and videos scattered in multiple locations around the house?
These questions helped me realize that my outer life was as chaotic as my inner life. Running a business is incredibly challenging and takes the majority of my energy. By making my home life simpler I was able to feel a sense of peace and serenity and improve my overall well being.
So this is what I did:
I gave away everything that I did not use on a daily basis to Good Will. From a financial standpoint, this was a big windfall for me because of the tax write off. I gave away kitchen items, tools, suitcases, clothes, towels, rugs, personal care items, and anything else lying around that was not essential to my daily living. I threw out items that were broken or worn out. I packed away boxes of miscellaneous items, such as frames, statues, books, stuffed animals. These items were cluttering my shelves and collecting dust. The fact that I had so much, made me enjoy each item even less. So I put seventy five percent of the items away for safe keeping and to be opened later when I had a bigger house or more room. I might even rotate the items once in a while.
This immediately made me feel better because I had more uncluttered space in my home and I could find things more easily. But more importantly, it made me realize that I didn’t have to be surrounded by hundreds of material goods to be happy. I discovered that I probably didn’t need to buy many new things. This was great for my pocketbook.
After taking inventory and assessing what I really needed to live on, I was able to put my family budget together. It is nice that my husband and I were on the same track. He would be happy wearing the same shirt and pants every day for a week if he had to. So I didn’t get any resistance from him.
The way that you live your life and run your home should be based on a financial budget. Your financial budget can be determined once you take stock of what you have, what you need, and after you have determined what your family goals and dreams are.
Individuals, couples and families should write down their goals. Here are a few examples:
- My wife and I have no children and would like to retire in our 40’s
- My fiancÃ© and I would like to take a one-year trip around the world for our honeymoon
- We would like to send our 4 children to a private college and buy a second home
- I would like to own my own business within 2 years
Goals like these will not be accomplished without a setting up a budget and a financial plan. Once you have simplified your life, you will realize how easy it is to stick to your financial budget.
20 tips to simplify your financial life
- Do not spend more than you make
- Create a budget and stick to it
- Keep track of the money you spend
- Don’t spend money on unnecessary items like Latte’s
- Don’t impulse buy
- Give unnecessary or unused items to Good Will for tax deduction
- Max out your IRA and 401K
- Eliminate all credit cards except for 2: 1 for main usage and 1 for emergencies
- Eliminate all credit card debt
- Consolidate loans if possible
- Automatically deduct monthly bills from your checking account
- Sign up for online bill pay
- Monitor your visa statements online every Sunday
- Create a file system for all financial related items
- Use a software program like Microsoft Money or Quicken
- Set a clothing budget and stick to it
- Set a budget for eating out and stick to it
- Get Insurance to cover potential losses
- Save 6 months of cash for living expenses
- Monitor your progress once a month
I hope this inspires you to put a plan together today to simplify your life. For extra motivation there are a multitude of books on the subject. Ms. Money recommends the following books: