5 Minimalist Wealth-Building Habits That Will Change Your Life
I want to share with you five essential wealth-building habits that have helped me significantly change my life. I have adopted minimalist habits, saving me money and reducing waste. A simple change of mindset helped me immensely.
Happiness and money
As someone who has spent a lot of money buying stuff, I can confidently say that the things we buy make little to no difference in our lives. The things that fill our house don't add long-lasting value to our lives.
Our society focuses so much on being material rich instead of life rich. Once we realize that being materially rich is surface-level and vulnerable, it makes us question what we're working towards.
Since becoming a minimalist, I've been building a life according to what true wealth means. On top of that list are my health, mental well-being, relationships, my time, and experiences.
You might have heard of a well-known study on happiness and money. Researchers have found that happiness increases with income, but there is a point of diminishing returns at about $75,000 to $120,000 a year.
I think that the study is outdated, and so many details were not accounted for, but when I read it, it was the first time I started to think about how much I need to earn to live a good life.
A couple of years back, I found out the hard way what my point of diminishing returns was. My husband and I were doing more than okay financially.
Still, I was so excited to earn more that I took every opportunity to do so without considering what I was trading for it: my weekend's sleep, family gatherings, and time doing things I love. In hindsight, that extra income was not worth it.
Being able to work and earn money is a privilege. Having economic goals is excellent, but many other aspects of life add to our overall happiness.
Knowing how much I need to live a good life has been my ultimate guide to balancing out my life. Once I meet that goal, I know the surplus won't add more value to my life. Besides, money comes and goes, but there are things we cannot get back in life.
At times I think we have to embrace lifestyle inflation. I used to travel on a shoestring budget in my early twenties, staying in overcrowded hostels.
Now in my thirties, I prefer to travel a bit differently and stay somewhere nicer with my husband. There is no shame in working hard to afford a better life for ourselves.
With that being said, lifestyle inflation can creep in and spread, and if we're not in control of our finances, it can be a slippery slope.
What was once considered a luxury turns into a need, and as a result, we can't save for those more significant purchases that might have a bigger impact on our lives. No matter how much we earn, my husband and I keep our lifestyle pretty much the same.
This has given us more room and flexibility to spend on things outside our regular budget when we want to and need to.
This is your reminder to go and check your expenses, know how much you need, and put aside the rest for the bigger goal that you have for yourself. I think this is the best way to be satisfied with your lifestyle while still building the life of your dreams.
Investing our money is probably the fastest way to grow our wealth, but investing in our well-being is equally important.
I'm talking about buying a standup desk if you work from home, going out for lunch on Mondays to have something to look forward to, or signing up for a group membership because you want to belong to a community.
Growing our wealth and having a lot of money means nothing if we are not in a good mental state.
There are free and simple ways to achieve this by sleeping enough, exercising, having hobbies, and eating right. Sometimes it's not so simple, and money can be used to benefit us now instead of later.
I know I said that the things we buy make little to no difference in our lives. I'm not switching my narrative here, but obviously, there are exceptions to this.
Sometimes buying the right things can make a world of difference. Investing in your safety, health, and peace of mind should be a priority.
Comparing to others
There was a time when I used to compare myself to others as a motivation to do better.
I realized that even though the motivation came from a good place, I wasn't doing it for myself. I was working towards someone else's dream.
Choose the option that creates the most value
There are hundreds, if not thousands, of decisions we must make daily. It's impossible to commit to all, so we must choose the ones that bring the most value to our lives.
I have been applying this concept to my finances, which has made a difference.
Do I want to put in time and effort for that project, extra work, or a second job? How much value will I get out of it? And is it worth what I'm giving away?
When purchasing something, I ask myself, is it worth the money I'm paying for and the time I spent working for it? It takes a few minutes to think it over, but I think it helps to narrow down my options every time.
This way, it's always an enthusiastic yes when I say yes to something. I think knowing what our time and energy are worth is the first step to creating boundaries because, without them, we're directionless, and it can sway us to do things or spend our money without our intent.
Minimalist wealth-building habits
Create a short mental checklist to help you guide your decisions. Your priorities will speak loudly for themselves. Those priorities will become your wealth-building habits. What is your most important priority? Share in the comments below.
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