After a Financial Crisis: Keeping a Minimalist Approach to Money

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Life isn’t easy.

Sure, understatement of the year. But sometimes life throws a curveball at you that sends your life spinning out of control.

It’s when everything changes.

I’ve lived through many crises that taught me a few hard lessons. One of the most difficult was surviving the recession that started in December 2007. Not only was my business in danger of closing, but my husband was in a car accident in January 2008. Our car was totaled and my husband had a new back injury.

It seemed like we couldn’t win. Out of necessity, I became a minimalist. Now that we’ve recovered, there’s no way I’m going back to my old pre-minimalist days.

Here’re are a few ways you can keep your minimalist approach to money, even after you’ve survived a financial crisis:

Ask Different Questions

Joshua Fields Millburn, one of The Minimalists, explains his thoughts on money:

“Now, before I spend money, I ask myself one question: Is this worth my freedom?

Is this coffee worth $2 of my freedom?
Is this shirt worth $30 of my freedom?
Is this car worth $20,000 of my freedom?

In other words, am I going to get more value from the thing I’m about to purchase, or am I going to get more value from my freedom?”

When you’re in the middle of a financial crisis, it’s easy to feel like every purchase needs to be evaluated. Even if it’s something small like a $2 cup of coffee.

Then after you survive the crisis, you tend to forget that $2 cups of coffee add up. But $2 a day (and that’s a cheap cup of coffee) every day adds up. $730 a year in fact.

So don’t switch back to your old thinking. Don’t forget that your small purchases add up. Take advice from an expert in minimalism and always ask is this worth it my freedom?

Keep Streamlining Everything

I was forced into streamlining my finances or risk losing my business. I had no choice. But that was actually a blessing in disguise as I should have streamlined many business processes years ago.

That meant evaluating every aspect of what I do. For example, James Bucki, from The Balance, shares a few questions to ask when trying to reduce the amount of paperwork you have:

“What information do you add to the paperwork and why is it needed?
What information do you take from the paperwork and why do you need it?
Why is this paperwork important for you to perform your job?”

Answering because this is how it’s always been done isn’t good enough. There has to be a reason why you should keep the process going. This applies to everything, from your business to your personal life.

I streamlined everything, from how I handled customer invoicing, to changing mobile phone providers, to creating a weekly meal plan to reduce grocery costs. Just because you’re financially stable now isn’t enough reason to stop trying to reduce waste, cost and how you spend your valuable time.

Plan For Your Next Crisis

Sorry to be the bearer of bad news, but there’s going to be another crisis. I can’t see into the future but I know that life will throw something at you that will ultimately lead to another financial crisis.

Again, that’s just life.

Be thankful that you survived your last crisis and that you’re financially stable – for the moment. Now it’s time to prepare for what comes next. It’s time to put all your ducks in a row. Part of that is repairing the damage you may have suffered during your last crisis, including fixing your credit. Financial experts advise that if you want to fix personal credit issues you’ll “want to make sure to pay off items such as judgments, liens, collections or past due child support to help ensure you get the lowest possible rate”.

There are many other ways to make a plan, including starting an emergency fund, refinancing your mortgage, paying down credit cards, etc. Maybe it’s buying more insurance or creating legal documents that would protect your interest. I know it would be easy to just sit back and relax. But you’ll have less stress, worry, and anxiety if you can prepare (as best you can) for whatever happens next.

Minimalism is a Lifestyle, Not a Crisis Management Style

I was forced to become a minimalist. And it was one of the best things that ever happened to me.

I’m happier now in every respect. The shock of a financial crisis is incredibly stressful, but learning how to live a simpler life is a blessing. I could have easily regressed into my old spending style and not thought a lot about money or prepare for my future. Yet, it would be crazy not to apply the hard lessons I was forced to learn.

We have no idea of what’s coming around the corner. That’s why a minimalist approach shouldn’t only be used to manage a financial crisis.

It should be your new lifestyle.