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

  • 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

  • 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 🙂

  • 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 🙃

  • 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!

  • 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.

  • 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✌️

  • 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.

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

  • 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

  • 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

  • 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.

  • 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 .

  • 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.

  • 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

  • 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.

  • 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

  • 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.

  • 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

  • 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.

  • 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.

  • 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!

  • 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

  • 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.

  • 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

  • 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.

  • 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

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

  • 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

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

  • 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.

  • 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

  • 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.

  • 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.

  • 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

  • I love it 😁 I just wrote on my arm ,, you deserve to be dept-free! because you deserve Freedom" 🤔… 😅 I'm in work, when I'm home I will write it on a note but maybe I just keep it on my arm, so I can read it when I'm about to buy something 😅❤

  • I'm currently debt free, I'm 39 years old.
    Lived at my townhome and kept the same job for the last 12 years.
    Books that helped me were The Millionaire Next door & recently 12 Rules for Life by Jordan Peterson. I also have two rental properties that are paid for.

  • Rule No.1 if you have money don’t tell people about it, they’ll make it their business to get it from you somehow and when they have money problems they’ll think of you first and people with money problems don’t want to pay you back

  • I have to be debt free cause I want to go for a career shift. And only way is Invest everything so not much is left to spend…

  • Rich people are usually rich because their parents were rich. Look at the stats. You had parents who had a house and had space for you to live. If they were minimalists or poor they wouldn't have had that lying around! You are where you are because you are privelged as much as because you are smart and you should start by acknowledging that.

  • The way i save money is by living with my parents. I don't have to pay for gas or rent or food or anything really. The reason i still live with my parents is because I'm not really allowed to move out in my culture untill i get married and move in in my husband's house but i can't say I'm complaining

  • You're absolutely right. I don't need that table in the balcony in order to study better. Unfortunately I dont have parents to go back to..

  • Never had debt issues, but I've had a spending issue where I spend what I earn. Now I've got a budget. I allocate a certain amount for food, gas, bills, and save the rest.

  • Becoming an entrepreneur has helped me the most along with the self help books before I started my business, I’m in my first year of trucking and coming up on 100k, it’s a struggle everyday but most guys my age are in college ( I’m 22 ) so I’m very thankful! Hey great video, keep them coming!

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