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A Minimalist Approach to Personal Finance

A Minimalist Approach to Personal Finance

For most of my life I wasn’t very good with money I made it and I spent it the money came in and out and since nearly eight out of ten Americans live paycheck to paycheck I’m guessing that’s something that you can relate to as well after four years of college I left with a degree in mass communications and 97 thousand dollars in student loan debt. Then I bought a brand new car I told you I wasn’t very good with money. There was something holding me back from even looking at my personal finances It had become a joke. I owe him some money What kind of money I had dug myself into a hole so deep it didn’t even seem possible That I’d ever get out the crazy part all that debt wasn’t stopping me from spending after I got the new car I added a new TV Computer and even a leather jacket to my running tab that leather jacket was pretty cool though soon after college, though I came to the realization that I needed to make a change that I couldn’t just pretend like I wasn’t in massive trouble It was one of the most challenging things that I’ve ever done in my entire life But over the course of 4 years I was able to pay off every single student loan even that car payment and that’s what I want to talk about today Money our problems with it and how minimalism has helped me there’s a basic formula to win at personal finance and It’s this. Spend less money than you make In practice though It’s not that easy money seems to completely slip through our fingers no matter how much money we make our bank account seems to have a Completely different agenda. One of the reasons that we’re bad with money is because money is taboo We can’t even talk about it with coworkers with family members without people feeling judged or downright Offended we can only improve if we start to have honest conversations About money we need to remove our egos and actually try to learn. One of the best ways that I’ve found To learn about personal finance is through books and I’ll give three recommendations Dave Ramsey’s Total Money Makeover Ramita Sadie’s I will teach to be rich and Tony Robbins Unshakable, all three of these books lay out great advice trusted advice that has worked and I think that you’ll find a lot of value from them Don’t fall into the trap of lifestyle creep Whenever we get a pay raise or we start to make a little bit more money We land a really big project. The first thing that we want to do is Upgrade our apartment buy a better car Increase our lifestyle. So then that way we’re in some way rewarding this win But if we were instead to be more mindful about our spending if we were to keep our lifestyle in check and not Inflate it as our income rises. 5, 10 years down the road we’re gonna be able to live a lot more comfortably and we’re gonna have so much more security than if we continue to increase our Lifestyle every year, let’s be honest. We buy a ton of shit and we convince ourselves in a lot of sneaky ways Why we deserve it. I mean I like shopping Is there anything so wrong with that not all advertising is bad but a lot of it is Driven to make us feel as if we deserve the indulgence you’ve worked so hard you deserve this handbag these sneakers or this watch and The truth of the matter is that what you deserve is to be debt-free? You deserve not living paycheck to paycheck we face pressure from social media keeping up with the Joneses or the Kardashians is a very real thing and if we’re not Curating and mindful of our news feeds and our social media feeds it can be Very tempting to want to keep up and have the things that everybody else have otherwise, we’ll have the fear of missing out But here’s the thing rich people are rich because they make smart decisions With their money, they don’t go out and lease a brand new BMW They don’t rent an apartment that they can’t afford and the last type of pressure that we face is pressure from ourselves There’s this thing called the myth of ‘I don’t have’ and it’s something that we tell ourselves To convince us that we need to go out and buy that thing So as a filmmaker, you might say I really want to make that film or that video but I don’t have this lens or I don’t have this camera so I can’t do it or I can’t go out for that run or that jog I can’t start my new workout routine because I don’t have that pair of sneakers but really the only thing that’s doing is procrastinating us from getting started with our goals and our dreams and It’s convincing us that buying that extra thing is gonna solve everything which it won’t you need to make sacrifices when I graduated college Within 3 months I decided to move home with my parents and I lived in my parents basement Literally in the basement for two years. I didn’t date much didn’t spend much I didn’t go out much because I knew that I had to make some sacrifices To get to a point when I could start to take risks You have to be completely clear with why you’re doing this in the first place. Why do you want to be debt-free? Why do you want to have? Financial freedom when we truly understand why we don’t want to be living paycheck to paycheck Why we would want to be debt-free Everything else comes a little bit easier when We think about having the security and safety being able to take care of our family and our friends if they run into trouble It becomes more obvious Why this is so important you’re able then to take more risks to challenge yourself. Put your push yourself outside of your comfort zone In ways that you otherwise wouldn’t be able to I know for myself if I wasn’t debt-free, I Wouldn’t be where I am today. If I didn’t take in that first step and realize that I had a problem I wouldn’t have had that domino effect that led me to where I am to be able to take pretty ambitious and risky decisions to move across the country to Leave my business and start a complete new one these aren’t easy decisions and when you have debt It’s gonna be that much more difficult and that less likely that you’re gonna succeed The strategy couldn’t be more simple spend less money than you make but as you know We face a lot of pressure to do the exact opposite But if you can out maneuver these forces, if you can build a healthy relationship with money, and create positive habits that stick You will be able to become financially free Thanks so much for watching. What strategies tips tools and books have helped you on your own Personal finance journey what things have helped you to chip away and even get out of debt? I’d love to hear about your success stories as well as a part of that conversation opening up the dialogue about money I think we should be encouraging each other and Really rewarding each other for making positive steps in our lives try not to feel threatened or discouraged if other people have a great success story see it as Potential in yourself if somebody is able to get out of debt. That means that you probably can too. Thank you guys for watching

100 thoughts on “A Minimalist Approach to Personal Finance

  1. Hey everybody! I'm making a course on habit change (it's my first one and it's going to be awesome). There will be lots of videos, silly jokes, & most of all actionable steps to make any habit stick.

    Sign up to hear about it… http://mattdavella.com/newsletter

  2. i'm only 16, but i really wanna get a head start on these things (i sort of came to the realization that in a few years i'll be expected to be a responsible adult), luckily i'm from Denmark, where university is free, so it is possible to come out the other side without debt, but even so, you still have to be smart about it.

  3. I love this, had to subscribe. I'm currently tackling my debt with the same mentality. It's been six months and I've been able to pay off $7,700 of credit card debt and roughly $2,000 of student loans. I have a long way to go, but making the sacrifice to live at home with my parents for another 4 months. Being in debt has definitely taught me to appreciate the simple things in life. I no longer find the need to purchase unnecessary luxury goods, I don't eat out as much, I pretty much try to be as frugal as possible. Some of the books that helped me stay motivated were Master Your Debt by Jordan E. Goodman, The ABC's of Getting Out of Debt and of course the Total Money Makeover. The first two books are a little outdated, and you will find ideas that wouldn't necessarily work in today's economy, but there are a lot of overlapping principles.

  4. The video got recommended to me but funnily enough, I'm debt-free since my parents paid for my degree and car. My only problem now is saving up for a house.

  5. I’m currently testing out Dan Lok’s money bucket system. Split everything into 5 different accounts, automatically every pay period. The buckets are expenses, emergency, learning, investment, fun.

  6. Fave Ramsey says to get rid of debt and save and invest in mutual funds. Bull shit. Dollars are printed . Saving it is for losers. Mutual funds make brokers rich. This guy never heard Kiyosaki I guess. Dont listen to this amateur

  7. I don’t give a fuck … I spend my money .. I don’t wanna be rich .. nor do I want to live my life not doing what I want ( traveling, eating out , scuba diving , gym , etc it all costs money) instead of saving to be able to spend it when I’m 60 … I need the money now .. with that being said I don’t spend more than I earn and u save .. but far from being a minimalist

  8. A good way to save is to have a month or two a year where u only spend on emergency stuff, gasoline, and groceries (and still buy stuff u NEED when shopping for food – leave the crisps and chocolate behind, and try to clear the cupboards throughout the month.)
    Have a budget for the month and work out later how much u saved

  9. You should live off a third of what you earn. Save two thirds and only spend a third of what you save over the time that you saved it. $$$$

  10. We need to return to hunter gatherer lifestyle then we will not need to worry about finances or debt or taxes or any of that junk.

  11. I’ve gone thru a lot of ups and downs in my personal finance journey. I’ve worked 3 jobs to save money but I’ve also spent faster than I made and ended up thousands in debt at one point. For me it’s about getting on a good roll and continuing it. For some reason when I start down a bad path, I start racing down that path. So I try to learn from that lesson and when I realize I’m doing that I try to change direction. Same goes when I’m doing the right things and saving money. Once I start it becomes easier and easier.

  12. I retired a year ago at age 56. I drive a 21 year old Toyota Corolla with just under 100 thousand miles. These cars are known to run 200,000 to 300,000 miles.
    My wife and I live in a 600 a month apartment. We never eat out or go to movies etc.. if I need a pair of pants I go to Goodwill.
    We don’t go on vacations. Everyday is a vacation not having to go to a job. This summer I spent a lot of time outside doing things that cost nothing but my time.
    We cut cable a couple years ago. I watch Netflix in the evenings and the wife has shows she follows on the tv that are free with an antenna.
    We don’t not waste paper towels even as these are expensive. We just tear off part of a towel. We are on the last roll from a package of rolls bought last fall.
    We don’t buy anything for ourselves. We both have more than we need.
    I believe that people who have to have the latest stuff and sacrifice their lives working for things are being suckered into our capitalist driven society that tries to sell us everything.
    My IPad I’m typing on is around 5 or 6 years old. My phone is 7 years old and I pay as I go for 38 dollars a month.

  13. Here’s the minimalist approach – live on less than you earn & invest the difference in TQQQ – problem solved you’re welcome

  14. The Bible offers plenty of wisdom about money. Here's just a few…
    Matthew 6:33 ESv
    But seek first the kingdom of God and his righteousness, and all these things will be added to you.

    Matthew 6:24 ESV
    “No one can serve two masters, for either he will hate the one and love the other, or he will be devoted to the one and despise the other. You cannot serve God and money.

    Philippians 4:19 esv
    And my God will supply every need of yours according to his riches in glory in Christ Jesus.

    Malachi 3:10 ESV
    Bring the full tithe into the storehouse, that there may be food in my house. And thereby put me to the test, says the Lordof hosts, if I will not open the windows of heaven for you and pour down for you a blessing until there is no more need.

    Proverbs 22:7 Esv
    The rich rules over the poor, and the borrower is the slave of the lender.

    Proverbs 21:20 ESV
    Precious treasure and oil are in a wise man's dwelling, but a foolish man devours it.

    Romans 13:8 ESV
    Owe no one anything, except to love each other, for the one who loves another has fulfilled the law.

    1 Timothy 5:8 ESV
    But if anyone does not provide for his relatives, and especially for members of his household, he has denied the faith and is worse than an unbeliever.

    Luke 14:28 ESV
    For which of you, desiring to build a tower, does not first sit down and count the cost, whether he has enough to complete it?

    Luke 6:38 ESV
    Give, and it will be given to you. Good measure, pressed down, shaken together, running over, will be put into your lap. For with the measure you use it will be measured back to you.”

    Hebrews 13:5 ESV
    Keep your life free from love of money, and be content with what you have, for he has said, “I will never leave you nor forsake you.”

    1 Timothy 6:10 ESV
    For the love of money is a root of all kinds of evils. It is through this craving that some have wandered away from the faith and pierced themselves with many pangs.

    2 Thessalonians 3:10 ESV
    For even when we were with you, we would give you this command: If anyone is not willing to work, let him not eat.

    Colossians 3:23 ESV
    Whatever you do, work heartily, as for the Lord and not for men,

    Acts 20:35 ESV
    In all things I have shown you that by working hard in this way we must help the weak and remember the words of the Lord Jesus, how he himself said, ‘It is more blessed to give than to receive.’”

    Proverbs 28:20 ESv
    A faithful man will abound with blessings, but whoever hastens to be rich will not go unpunished.

    Proverbs 13:
    Wealth gained hastily will dwindle, but whoever gathers little by little will increase it.

    Philippians 4:11-13 ESV
    Not that I am speaking of being in need, for I have learned in whatever situation I am to be content. I know how to be brought low, and I know how to abound. In any and every circumstance, I have learned the secret of facing plenty and hunger, abundance and need. I can do all things through him who strengthens me.

    2 Corinthians 9:7 ESV
    Each one must give as he has decided in his heart, not reluctantly or under compulsion, for God loves a cheerful giver.

    Romans 13:7 ESV
    Pay to all what is owed to them: taxes to whom taxes are owed, revenue to whom revenue is owed, respect to whom respect is owed, honor to whom honor is owed.

  15. I think it goes back to the basic principle of a need vs. a want. Buying what you want gives you short-term pleasure, whereas buying what you need gives you long-term satisfaction.

  16. For UK viewers…I found this book very good…it explains a lot of the jargon and basic concepts around savings, mortgages, investments etc: Money: A User's Guide by Laura Whateley

  17. Hello, I discover your Channel and I suscribe . Thanks for these principles and sorry for mistakes I'm French learning English 😊

  18. All this is ok but you will be living putting money first ..trying to save,save,save…. that brings a whole new palethra of problems.

  19. I'm not very good with money, but I always pay my bills on time. I tend to get myself into debt when I'm unemployed, and I live paycheck to paycheck because of it. Back in July 2015, I went vegan but I also became unemployed and would be until August of 2017 (yeah it was rough). I didn't have the funds to pay my 10K+ debt, so I let it go to collections. Eventually, I used all my savings to pay some of it, leaving one card, which I'm currently paying off since I have the means to. In January of 2018, I became unemployed again, and I relied on my one credit card with a HIGH APR. Huge mistake, but I didn't have another choice. Thankfully, I found a job about 5 months later even though it was minimum wage. I worked 4 part time jobs in 2018 and could not pay down my debt. Now I finally have a full time (still minimum wage SIGH) so I make just enough to make bigger payments. I'm finally getting a handle on my money and I'm trying to be more responsible. So thank you for this video. I know I don't have a lot of debt, it's very small compared to the average, but it's still a struggle since I don't make a living wage.

  20. I don't understand why Americans have to have it so hard after they graduate, I live in central Europe and education is free here, what more it's actually that the prestigious schools are never paid. All the paid schools are considered a free degree, just a paper nothing more.

  21. I disagree with you on this and here is why, please read constructive criticism thanks 🙂 First off the poverty is getting worse and I know personally people who only get 1500.00/mnth and live in the slums with roaches and bed bugs in Canada. Personally no one should have to live this way but they do! So a couple of your minimalism videos are unreasonable to the poor. Also I think finding a healthy place to live should be priority 1. However it is out of the price range for the poor which is growing every day. We ignore this as we are wrapped up in our own little worlds and think everyone lives something like we do. Even eating right is very costly when you break it down. If you think this is a unrealistic comment then please do the following exercise and post your findings. I want you to imagine you only get 1500/mnth Now budget that to pay bills like rent, food, well the essentials. Now how much do you have left? This is the reality most people live in so what would be your advice to them? How could they afford a reasonable place to live without being sprayed every week for bugs they didnt cause? Interested to see how you respond to this and thanks for reading 🙂

  22. The rule of 50-40-10 helps me a lot. 50% of my salary for the necessary things (apartment, electricity, car, etc.), 40% of my salary for economies, 10% of my salary for what makes me happy. Sorry for my english, French is my first language. Thanks for the tips 🙃

  23. I use two checking accounts and one savings. One checking account is for bills while the other is reserved for misc. spending (gas, groceries, eating out, and other non-recurring expenses).

    Every week I put $150 in the misc. account and if I have a surplus at the end of the week I just add another $150 to that. If car maintenance or other unforeseen expenses come up I typically have money to pay for them without touching my savings and I know I’m spending exactly $600/month.

    Hope this helps someone!

  24. For me I've cut myself a bit of slack to experiment to find what are the essentials for me. I've finally stopped buying coffee at my cafe but I make my own using very high quality coffee and coconut milk. I know which breakfast is tasty and nutritional for me and inexpensive (savory oatmeal with tempeh and mushroom), I love to cook and research the easy recipes I can make with inexpensive ingredients or the things I have at home and I try not to waste food. The hardest part for me is setting goals and understanding what is essential for me to be fulfilled so I'm not seeking endlessly.. I don't use a credit card because the math is too complicated for me. I try to be present with my feelings and figure out how my experiences can fulfill me more than things. It's hard in a city because there's always a sense of disconnection from nature so that in itself creates a sense of neediness. I want to live more in nature but worry about being able to have an income and creative opportunities in a smaller town. But struggling with these things and allowing your needs to become clearer all the time is exactly the process that we need to be in.

  25. Man, living in such poor country as Ukraine has taught me, that most of Americans are freaking dumb, when it comes to managing their money. The concept of spending more money than you make alone simply makes me cringe and leaves me confused. The idea of being tempted to buy stupid shit you don't need, resulting to being in F***ING DEBT just sounds senseless to me. God has definitely blessed America. Peace out✌️

  26. I live in a trailer. Monthly expenses are around $600 and I spend money on whatever I want. Not women though they are the biggest waste of money.

  27. Being minimal in investment instruments and keeping it simple. Not taking too much leverage and rebalancing via asset allocation is most important

  28. A few things that are helping me at the moment;

    1. Having a savings account that requires 30 day notice before money can be withdrawn
    2. The spare change vault on Revolut. Make all purchases with your revolut card, the spare change feature rounds up each purchase to the nearest euro and multiplies it x 10, throws it in the vault. At the end of the month, put whatevers in there into the above savings account.
    3. Pay yourself first. On the day you get paid, first thing you do is put the required amount into the above savings account. Then bills, rent etc and the rest onto the revolut account.
    4. Try to be frugal, if you need money, there's a surplus in the revolut spare change Vault to dip into

  29. Thanks for this video Matt! Richest Man in Babylon by George Clason made it plain and simple how to be financially free. Rich dad Poor dad advises me how to create an empire

  30. I have two computers. One has a GTX 980 and one has a GTX 1080. There is newer graphics cards out which would increase performance by….a pinch. It's at this point every computer enthusiast is met with a decision….spend the $1k+ on an upgrade that's not very big or just be happy with what you have now? I'm just lucky to be able to afford TWO computers with this much muscle.

  31. Can't everyone be rich and have whatever stuff they want? If we all focus on tightening our finances, then more cash will remain in people's pockets and away from banking sector stakeholders. That's pretty cool but doesn't drive innovation. Scrimping by low to middle income earners will barely move the needle in terms of driving the sort of innovation required for everyone to have whatever material goods they want. What we need is more people acquiring the skills that land the better jobs, more entrepreneurs/startups and more individuals investing directly in them, and we need to trust that the market truly is the best weighing machine, much better than any org/corp or gov.

  32. Great video. Insightful. Another valuable book is 'The Richest Man in Babylon.' It's a primer for anyone who is interested in beginning to save .

  33. when I was in college I also lived with my parents house. I didnt care what others people think bcoz I have a goal to achieve.

  34. As they always say u will never reach 100 percent. If u use money u can't b free. Either u sacrifice or run with the system ur not free. Fight to not spend much but deep inside wanting to have ur life full can't happen. Sorry

  35. You are not technically wrong that it is wise to cut out extra expenses in order to ensure that you do not spend more money than you make. However putting pressure on low income individuals to have a reduced quality of life is a form of victim blaming and ignores the REAL issue around debt, which is not that people are spending too much money, but rather that people are not making enough money. Your viewpoint basically boils down to echoing a common right wing rhetoric that "poor people should act poor" when in reality, it is the ultra rich who are hoarding all the money, and if working people were actually paid properly for their work then no one would have to make these sacrifices just to avoid debt. For many people, living paycheck to paycheck already includes not being able to buy whatever they want. This would have been a good video if you would have touched on the atrocities of income inequality, but you present it like if someone is poor it is their fault and that's just not true.

  36. The worst thing in this story is:

    I am from hungary where the average salary is 500-600 dollars (converted from HUF). For most people it is extreme difficult or absolutely impossible to save money. I am that kind of person.


    After watching your vids, I just realized, that changing begins in my head. Thanks for your advices. They helps me a lot in these difficult situations. Keep doing it.

  37. The mantra to follow (which has helped tremendously)
    1. Save 30% of the salary
    2. Don't get influenced by social media posts and lifestyle stories of others (Delete social media accounts, it feels so good to have FO[N]MO)
    3. Don't budge to peer pressure

  38. I live in Egypt where most of available jobs even for collage grads pays less than 2usd per hour, saving money is not the issue, making it is.

  39. You are really inspiring – i am following you and watching your videos for like 3-4 months and i cannot stopp watching and learning from you. Thank you really much I’m really happy that you are sharing this with us and making our life’s better. Keep on going 😉 thank you

  40. My Dad told me that no matter how much you make as the years go by, try to budget with the money you had in your first job! In other words, don't increase your spending, even when your salary increases.

  41. Hi, just wanted to let you know about my new book on Personal Finance and FREE educational tutorials that your viewers may be interested in at https://www.youtube.com/watch?v=oq_o4fq2zEQ&t=37s . Thank you.

  42. As of today I have the most amount of money I've ever had. And this video was very helpful. I need to keep saving…. Great advice!

  43. The pressure from ourself.. Is so true we pressure ourselves. I don't earn much but I make do with what I have and stay contented

  44. Joined the Army reserves, graduated debt free. Got into a technical trades diploma in a in-demand job. Was eating nothing but bananas, potatoes, and noodles before getting my career going. Life in the army sucked, sleep deprivation, physical and mental exhaustion was constant, but I got paid and was feed for free. Sure the food suck but I was doing way better than most people. Sure I did not party and did not go to bars and was almost a gym rat when I was living in base but I had savings. Now I have a career and investments, but still control my spending, only eat out or order once a month, very rarely do I drink alcohol and spend zero on drugs. Retirement is expensive, one would need more than 100k to live. People under estimate their savings for retirement. I still have a car because my job is 30 mins drive away from the Urban areas, very little to no public transportation. I bought a TDI/diesel because the calculation was way better, 30% more fuel efficient, the depreciation is way slower, the engine life can reach 999 000KM, diesel prices are cheaper.

    The only thing that sucks is social life because most people are not disciplined and spend their money on eating out a lot and drinking in clubs or bars where the alcohol is 700%-900% more expensive than the grocery store price, and that is not including the tips.Working in a growing industry also means less people to interact with and more machinery and computers. Social life is almost non existent.

  45. Giving up my holidays. I will have to live like I'm poor to get to where I want to be financially 😢😢😖 going to miss my holidays

  46. The biggest challenge of today's society is temptation and pride. Tempted to buy new things as soon as it hot the market. Proud to show off things that they cannot afford to buy, but still choose to buy because of ego and pride.

  47. You don't even need more money, even with your low wages you can still achieve beautiful things with it if you change your attitude towards money and learn how to be content and manage

  48. Hi everyone 😉
    If you looking for some new interesting books, I highly recommend you a book called "Rich Dad Poor Dad" by Robert Kiyosaki 😉

  49. Q: How not to be poor?
    A: Invest We all must invest, doesn't matter if you are business owner, CEO, or 9-5 employee. If you don't invest you always be on the other side of money.

    Q: What to invest?
    A: Time and Money

    Q: Where to Get the money to invest:

    A: 1. Pay YourSelf First, at least 10-20%%

    2. Always Live On Less, regardless of income put aside those 10-20%%
    3. Delay Gratification, don't waste your savings

    Q: Where to get time, I don't have it?
    A: We all have 24 hours no matter who you are you can't work more than that 🙂 so work smarter, not harder.

    Q: How to work smarter?

    A: 1. Eliminate. Apply 80/20 rule, set 1 Most Important Task for a day, use agenda not ToDo list.

    2. Delegate. Use money to buy other people's time and skills.

    Q: Where to invest?

    A: Invest in Your Own Business not in Stock Market

  50. I dont get american students: Why getting in so much debt, when you can study in another country with no cost at all?

  51. In Asia, we are taught to save. No individual with some common sense will go into debt to sustain a certain lifestyle. We save a portion of our income every month.
    Rampant consumerism and the fear of losing out will push people to spend more than they could afford.

  52. My family reused stuffs like,

    1. Younger brother uses the cloths of older one.
    2. Convert the reused cloth to make shopping bag
    3. When shopping bag is old enough and damaged
    4. Make a mop out of that shopping bag

  53. I saved to buy French and Italian fashion in my twenties. Now, with high income and no debt, I could buy whatever the new thing is… problem is I'm happy with Old Navy. Funny how that all works out.

  54. 3:51 this is so important. treat social media as a tool for what you can do to expand your hustle in some form, rather than something that you use to feed into unnecessary peer pressure and anxiety. hope this helps someone.

  55. I also recommend “The Richest Man in Babylon” by George Clason. It takes lessons about money and turns them into parables that are fun to read and easy to follow

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