Note: This article is a part of series called “Six Principles to Achieve Financial Freedom”. I’d strongly suggest starting from Principal 1 it to understand it better. Ignore if not applicable.
The most important principle that will help you gain immediate control over your financial destiny is to welcome Minimalism and say goodbye to Consumerism. I was first introduced by this topic on a YouTube video where two people would talk about minimalism lifestyle. However, it was not until my mid 20s when I understood minimalism in true sense.
My definition of minimalism is quite simple. Only spend money on the things that you need or that bring real value to your life. On the other hand, consumerism means buying excessive good, products and services frequently. Spending lavishly on every other things. With the rise of eCommerce websites where you can easily order almost anything online, consumerism has become more common.
I know guys who live in 3,000 square foot bungalow and drive an Audi worth 4 crore who I would consider to be a minimalist. You’d ask me how’s that possible? It’s simple, because they only spend money on the things that bring value to their lives.
They love cars and savor driving their Audi to their office. Entertain regularly and host parties on a monthly basis so the 3,000 square foot apartment is warranted. They aren’t filling their home with crap from HomeShop18 stuff or purchasing random stuff online that they don’t need from their credit cards on credit.
They are intentionally spending their money in a way that makes them happy without spending it on things that bring no value to their life. This is the second most important financial principle you can ever learn.
As mentioned by this great scholar 2000 years ago..
It is not the man who has too little, but the man who craves more, that is poor.Seneca
Before you make any purchase, ask yourself two questions.
1. Do I really need this?
2. Will it improve the quality of my life in the long term?
Yes, always have a long term approach if you’re confused about something.
For example, paying Rs.45,000 for one of those stupid hoverboards will do little more than drain your bank account and leave you with bloody knees. However, investing Rs.1,00,000 into the most comfortable mattress you can find will improve your sleep quality and have a positive impact on your life for the next 10 years. Do you see the difference I’m talking about?
Rich people have small TVs and big libraries, and poor people have small libraries and big TVs.Zig Ziglar
If you want to be financially free, you must avoid consumerism. Don’t buy things just because they are doing it or just because you think you’ll be left behind in this society or blah blah blah.
Make sure every purchase has a purpose and you will do just fine.
In short, if you have a good income and no desire to impress your neighbors, you’ll get rich pretty fast. Simple.
If we command our wealth, we shall be rich and free. If our wealth commands us, we are poor indeed.Edmund Burke
Wealth is not what you spend but what you accumulate. And how hard it grows. Then how hard it works for you.
Read ahead: Principle 3: Pay Yourself First and Do It Automatically