Join Africa's fastest growing career community!

Featured

Living and Thriving on a Minimalist Budget

Whether you are a high-income earner or a low-income earner,  a shift in your perception about money will cause you to see life differently and appreciate even the smallest things.

Article Preview Image

Whether you are a high-income earner or a low-income earner,  a shift in your perception about money will cause you to see life differently and appreciate even the smallest things.

Photo credit: Pressfoto

Richard Holloway, a Scottish writer, attributes traits such as simplicity, clarity, and singleness, as some of the qualities which give our lives power, vividness, and joy.

Consequently, the same attributes are the conforming principles of minimalists. Minimalism, according to Joshua Becker, is deliberately living with only the things that you really need, especially the things that support your purpose. As Becker puts it, minimalism is about redirecting your money towards more important pursuits than physical possessions. 

The main principle of minimalists is to own less in a world where owning more is revered and celebrated. Minimalists are driven by the fact that you only own what you need, even when you can afford luxurious materials. Whether you are a high-income earner or a low-income earner, lessons on savings can be drawn from a minimalist way of living. And yes, you can live and thrive on just what you need. True happiness doesn't come from the number of things you own but in the least of it.  A shift in your perception about money will cause you to see life differently and appreciate even the smallest things.

In a previous article, the road to financial wellness, I highlighted a few things one can do to be financially independent. In the article, the road to financial independence is not only limited to those having stable incomes. One of the key factors to achieving this is paying bills in time to reduce the burden of postponing your expenses. 

The following are some tips that you can use to thrive on a minimalist budget:  

 

1. Prioritize your needs

It's human nature to thirst for unnecessary things. There’s nothing wrong with a little bit of luxury here and there. But it is important to set your priorities right. List down your basic living expenses and work out a plan to sustain yourself.  Determining your priorities helps in cutting down costs and getting into the habit of spending on what you need rather than what you want. 

 

2. Create a budget

By now you have already prioritized your needs and are aware of what your income is.  You need to work on a budget that includes: 

 

  • Recurring expenditure

Recurring expenditure can also be referred to as day-to-day expenses. They include expenses such as rent, food, groceries, transportation costs and many more. 

 

  • Savings and investments

Savings is the art of setting aside finances for emergencies and future plans. Investments, on the other hand, is the skill of buying assets with the expectation that the assets shall earn you profits. For instance land and stocks. 

Having these two in mind while creating a budget will result in; 

 

  • Knowing the amount of money needed to cover your day-to-day costs and whether you may have some income to save up. 

  • It also gives you a clear overview of your financial status, and whether you are satisfied and not. 

 

3. Focus on having a zero-based budget

A Zero-based budget is the kind of budget where you allocate all your income to different spending and saving categories. The main purpose of doing this is so that all of your money has a purpose. 

Here's how to create a zero-based budget. 

 

  •  Write down your income. If you have a fluctuating income, take your lowest income price. 

  • Write down the basic living expenses like rent, education, mortgage, etc. Although it is advisable to focus more on recurring expenses.

  • Subtract your expenses from your income. If there is any money left over, allocate it. 

  • If your income is irregular and you earn extra money that you weren’t expecting, allocate that money as it comes in.

  • Analyze and repeat. Review your budget and see if it is working for you.

 

Do not forget that the main intention of a zero-based budget is so that all your income has a purpose. If your expenses exceed your income, you will adjust how much is allocated to different expenditures.

 

4. Live below your means

The rule of living below your means states that you spend as if you were earning much less than your actual income. That way you will start to have more control over your finances and achieve financial freedom. 

 

5. Save and stop going out when it's unnecessary

To change your habits of spending, to find more to save on, start by assessing your daily routines. For instance, you don't have to go out for lunch when you didn't intend to. Or, instead of going out to eat snacks, you could make the snacks at home for half the expense. Make the necessary adjustments in your lifestyle to adopt this minimalist approach to spending and budgeting. 

 

Conclusion

 

Many people refrain from budgeting just because they think it's a tedious and boring math exercise, but they are wrong. Budgeting is not just a game of numbers and maths, it's the value of the foregone good. What would you sacrifice to live a better sustainable life?

Written by

Phil Ibsen

Phill Ibsen is a creative writer, scriptwriter and a storyteller who believes in telling the story as it is and not as it should be. He is the founder of Master of Descriptions, a production company which aims in showcasing authentic stories. He’s also an affiliate writer at the Writers Guild.


Give a like!

1 Comments

Sign in to read comments and engage with the Fuzu community.

Login or Create a Free Account