Simple Living Tips For Extreme Wealth

Simple Living Tips For Extreme Wealth

My wife and I have always been pretty simple people.  We don't find happiness in buying things, but like anyone, we used to spend more than we should on things we didn't need.  When other people see how we live, sometimes they ask what drives us to live simple. 

"Money pays for our life priorities.  To be successful with money we have to set the right priorities."

What drives us to live simple? I don't know that we have an answer for that, maybe it's how we are wired.  I know the benefit we get from living differently, investing in what matters and trying to avoid spending on things that don't. 

We want to have choices in our life to do what we want.  That usually means you have to have a LOT of money, or you have to change your expectations about what you need. We are working on both of those things. Often times we can be our own worst enemies in achieving these goals.  We get caught up in short-term desires or our ego gets in the way of what we really want and what actually makes us happy.  

When you think about the things that matter the most, it almost never has to do with money.  That's why we need to find those things, hold on to them tightly and discover ways to live our lives in a way that allows us to do those things more often. 

It's easy to fall into a cycle of how most people live and how most people do things, but that's not going to give us different results.  It's going to look something just like the model you are following.  Maybe that model is what you want.  For me, it looks different. 

I'm set on making good money decisions because I don't want to have to live like others have decided I should live.  If I want to do something, pursue a different career, start a business, or have more kids, these decisions shouldn't be constrained by finances. 

"What you do for a living and how you live your life should be based on what you want to do, not what you can afford to do."

Tips On How to Live Simple

  1. Cut off subscriptions: You'll save a bunch of money and you simplify your life by eliminating recurring expenses.  Cutting off all my subscriptions was a very eye opening experience for me.  Cable, gym memberships, magazines, everything.  It eliminated guilt of not getting to the gym more and I just found other free ways to work out instead of paying for it.  It was very freeing.
     
  2. Minimize your wardrobe - Less laundry, fewer decisions, less to manage. When you don't have as much you don't need as much space.  You may have heard about how Steve Jobs wore the same thing every day because he didn't want to waste a decision on something so basic.   "The funny thing with decisions is that when you make them, you actually expend mental energy. If you make too many decisions in too short a time frame, you significantly reduce your decision-making ability."  - Steve Jobs 
     
  3. Embrace being different - Social pressures and how we were raised typically defines how we live.  Financial Hipster is about making sure you're doing what you want to do, not what people have told you to do.  That includes living a little differently.  When you save and invest like no one else you'll probably be doing it in a low key way. "Wealth is quiet, Rich is loud. Poor is flashy."  
     
  4. Save then spend- Savings come first.  First figure out what you want to fund, like paying off debt, maxing your retirement accounts or saving a certain amount in a college fund.  Then work backwards to figure out what is left over to spend.  Operating with this mentality is actually a big relief.  We never worry if we are making good money decisions because we already made them.  Controlling our spending is pretty easy at that point because we don't have much left over to spend after investing how we want to invest.  Doing this means we don't have to stress about where all our money is going because we funded the most important things first.  When you've already done what you need to do before any money hits your checking account, making decisions around spending for the month is a lot simpler.   
     
  5. Enjoy what you have - When we focus on enjoying what we have we are less inclined to develop wants and desires.  For example, we get asked all the time when we will be moving. People assume that because we are young, have a growing family, and make okay money that we'll be 'moving up' to a new house.  We have built such an appreciation for our house and for what it brings us in the form of freedom, that the idea of moving seems crazy.  
     
  6. Find simple means of entertainment - Use the library, go to a park or go camping.  There are so many fun and easy ways to entertain yourself and others that don't involve spending money.  Without cable, we have a lot more time to spend on things that matter and bring us value.  Things that don't cost anything, like writing this blog or reading books.  
     
  7. Borrow instead of buying - We borrow a lot of things and let others borrow from us.  We don't really want to own things if we don't have to.  We borrow things for our kids because we know we won't need them for long.  We give those things back or let others borrow them when we're done and pass them along.  There are countless amounts of things you really don't need to own that we can share with friends and family instead of buying.
     
  8. Filter what you bring into your life - This means filtering what you buy and what you take in, even if it's free.  Just because it's free doesn't mean you should take it.  People offer to give us stuff all the time and we politely decline.  We protect our space because we know that anything we bring in will take our time and energy away from us.  Everything we own takes something from us so make sure what you own brings you value or it's just taking it away.
     
  9. Purge frequently - We purge stuff quarterly.  Every 3 or 4 months we go through our home and choose items to donate to local organizations like Goodwill or Moms2B.  We donate or pass along gifts we've received for the kids that we don't need. Through this practice, we've noticed our girls play better and more creatively when they have less toys to play with. We also strive to keep our kiddos closets simple by recognizing what they don't wear and donating those items to other families.  Less laundry = happier parents. It is really easy to accumulate items in your house that you don't need or use.  We are constantly keeping an eye out for what we have too much of, like coffee mugs, glasses, plates, clothes or any other household items.  Even if we use them from time to time.  We always ask ourselves if it was gone would we miss it.  The answer is usually, no.
     
  10. Invest in people - Relationships are the foundation of our lives.  Invest time and energy into other people and give back.  Be present with your family and find time to spend with friends.
     
  11. Protect Your Time - It's so easy to let technology run our lives and overwhelm us.  We try our best to eliminate technology from our lives when we can.  We don't allow phones at the table.  We keep them in our rooms when we are home.  And we try not to look at our phones for an hour before bed.  It's not always easy and we aren't always perfect, but we are conscious of these things in order to prevent from other people and technology taking away too much of our time. 
     
  12. Build comfort in inconvenience - Living simply isn't always easier, but it is usually more gratifying.  It is easier to pay people to do things for you, drive instead of walk, or use paper towels instead of wash clothes; but being resourceful will actually feel better in the end because you know it's the right thing to do.
     
  13. Quit outsourcing your lifestyle - Mowing the lawn, raking the leaves, plowing your driveway, laundry, or cleaning your house.  These are basic aspects of living and homeownership.  If you don't want to do them, I'd suggest renting, have a smaller house, or have fewer clothes.  Paying for these things may free up your time in the short term, but if you saved or invested that money instead you will be buying yourself a lot more time in the future. 
     
  14. Stop purchasing - This one is a win-win. It builds excitement when you hold off on purchasing stuff and it can even eliminate your desire to own it. If I want something, I wait for a while and then decide if I still want it.  Majority of the time, I don't.  I haven't bought anything for myself that wasn't a necessity in years.  Might seem crazy, but I just wait for things I need and ask for them for Christmas or my birthday.  It is also surprising what seems to fall into your lap when you're looking for it.  This is one small example, but my wife had toothbrushes in her amazon shopping cart for the kids that had a timer on them in an effort to get them to brush their teeth for a longer period of time.  We held off for a few days because they already had toothbrushes, they just didn't have timers.  Crazy enough, in a week a family friend visited and without knowing brought us toothbrushes with timers for the girls in a goodie bag.  That doesn't always happen obviously but it's crazy how many times when we've needed something and just held off that we found another easier means of getting it. 
     
  15. Use your stuff as long as possible - This doesn't mean you have to wear your shoes or jeans until there are holes in them, but try to stretch how long you can use the things in your life.  I drive a 10-year-old car and as long as it doesn't break down, I'll probably drive it another 5 or more years.  Why?  Because a care doesn't bring me freedom.  The less you can pay for a vehicle, which only takes you from point A to point B, the closer you'll be to financial freedom.  We try to only pay for things when we really need them and use what we have for as long as possible.

Why Live Simple and Spend Less?

1. You become more grateful - When you make an effort to live simpler, you learn to desire less things and be more grateful for the things you have.  Focusing more on how you live and being more frugal with your money builds patience.  Then when you do get what you want because you were patient and waited till you could really afford it, you'll be more grateful when you get it.  Anything worth doing is difficult and the more difficult the better it feels when you accomplish a goal.  

2. You'll have more time - Living simple means spending more time away from a computer and away from technology that can often overwhelm us. Instead, spending time on relationships and yourself.  We all have the same amount of time in day, but you'll feel like you have more hours than others when you spend less time on Facebook or binge watching Netflix to do things that bring you more long term happiness.  This allows us to spend more time learning a new hobby, writing, or reading - Like this blog. :)

3. It's good for your health - When you don't have to pay for as many things you are less stressed.  Never having to worry about how you're going to pay your next bill feels really good.  Also, focusing on freeing up your time allows you to focus on paying yourself first, whether that's taking time to read a book or working out.  When you focus on living intentionally and with your best interests in mind, you'll be able to invest in what's best for your health.

4. It's good for your budget - It goes without saying that when we focus on living on less and enjoying experiences more, you'll be saving lots of money. These savings allows people to pay down debt and invest for their future.  It's not easy because human nature tells us to accumulate and buy things.  It's cool to do that within reason, but it's about realizing when more doesn't buy more happiness.  This post talks about how research has shown we are no more likely to be happy from money after 75k a year.  If you can live on less, that number is actually much lower. 

5. You'll be more creative - When you find ways not to spend your money on things that don't matter and instead spend your time on things that do you have to get a little creative.  It's finding ways to ride your bike places or walk instead of driving.  People are too comfortable with just hopping in a car instead of finding alternative means of transportation.  Learning to live without all the conveniences in life is actually fun for us.  We like to be creative and finds ways to get things done more simply and cheaper.   Doing activities at the library is a great example.  They have free music classes that our kids love.  Some people pay 50-60 bucks for a handful of classes.  Get creative and use the free resources in your community!

"Life is really simple, but we insist on making it complicated."  ~ Confucius
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