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Simple Money

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A few week ago when I posted about blogging I had a reader suggest I write a post on simple money.  I have posted on money before and it is a tough subject.

Initially money seems simple.   We get it for work or extra things we produce and we trade it for what we don’t have.  It has been around forever and is used by everyone.  My kids understand the value of money and use it (both of them started around the age of 5).

Simple right?

However, it is also very un-simple.  It is a major stressor, a reason for many divorces, even a cause for suicides.

Money is a big deal

  • We all need money
  • We all use money
  • We all (or I don’t know anyone who doesn’t) could use more
  • We spend a large portion of our life getting it, spending it, or thinking about getting or spending it

These are universal for both those with only a little money and those with a lot.

But what makes it un-simple?  I think this is the key:

Those who are not stressed about money are those who spend less than they make.

People who consistently spend less than they make are not in dept, have emergency funds in place, and can save up for what they want.  All of these things, when present, remove money stress creating a simple money life.

Life throws us lots of different seasons with regards to money.  Sometimes we make more, sometimes we make less.  Sometimes huge expenses come up, sometimes investment opportunities present themselves.  Life is just crazy like that.

Right now we are making less than we have for almost our entire married life.  It seems to be the season we are in right now.  We are choosing to be self-employed and we are choosing to be a one income household.  In this construction economy it makes for a low money season.  But it is just that – a season.  We are working hard at generating other income streams as well as working to keep ‘money in’ above ‘money out’ even though it is harder now.

Are you stressed out about money?  Are you going through a ‘low money season now?’ or are you spending more than you make?  Spending everything you make?

Then something has to change.

  1. Look at reality – Ignoring the problem won’t make it go away.  Make sure you know exactly where you stand financially.
  2. Figure out as much as possible about your money flow –  Where is it all coming from and where is it all going?  It takes time and work, but it is too important to not understand.  Make sure to understand all loans, insurance policies, and all contracts you have.  Sure it is complicated, and if your money is going there you need to understand it.
  3. Realize you are still in control of the situation – Could you work another job or two?  Could you sell assets?  Could you eat only rice and beans?  Yes, probably.   Hopefully you don’t have to go to any of these extremes but you are still in control of the situation and your financial decisions.  You do have other options, you are choosing between them.  You are not stuck!
  4. Work on long term income growth and short term expense cuts –  Emergency is to get expenses below income.  Goal is to increase income to give expenses room to breath.
  5. Spend for what matters the most to you (and your family) –  This is personal and something you will need to decide.  What matters the most to my family and I is that we have the freedom of self-employment and that the kids can be home and homeschooled.  To be able to afford that right now we are living in a small apartment and spending as little as possible.  Sure we wish we had more money for different things, but we are happy with our decisions.

A good tool is Dave Ramsey’s calculator. It helps you figure out what percent you are spending in each category and what categories are (according to his recommendations or averages) a bit high.

The beast of money will either be a tool to create your life or it will be a slave driver.  The crazy thing is that it isn’t how much you make that decides which role it will fill.  It is you.

Part 2 of Simple Money coming next week!


  1. Christa Christa

    Its good to see a minimalist finance article. I find that even minimalists can spend way too much money. As a mom with 4 children its a battle to keep from spending more than you make. There always seems to be an extracurricular activity, a birthday, school supplies, or clothes and shoes. This doesn’t even touch the grocery bills. We may be minimalists but were maintaining 6 minimalists lives instead of one. I really liked your article on the Stress Free at $40,000. Its good to see another family’s budget sometimes and think man, is this portion of our budget in line with the norm or way out of line with the norm. Thanks for your transparency and willingness to talk about something that is on most peoples’ minds.

    • Christa, thanks for you comment and nice to meet you 🙂 Kids are hard with all the extracurricular activities, I agree! They pop up everywhere without warning. Never very much, but they add up fast.

  2. I’m very blessed to be living my dream and not stressed about money. But I spent MANY years with a written budget, checking it monthly or even weekly and always if I wanted to spend on something not on the list! Multiple jobs at one time – been there! If an opportunity appeared – I took it. RARELY spent on trendy. Not easy, not quick, but at 50+ I can say it was worth it! And that thoughtful, minimal lifestyle is so ingrained, I don’t even realize it.

    • Yay! Thanks for sharing 🙂

  3. Cam Cam

    About a year ago, I read an article that talked about a study where the perception of rich was always about double one’s income was.

    So someone making $40k would think that $80k-100k was rich, but the person making $120k believes that if they could only do $250k they would be rich. It continued up with even those who had a net worth of over one million dollars feeling like they needed to have 2-3 million.

    We are tempted to always compare our financial status to those around us and since the media can show us those who are rich, and we can see people who appear to be doing better than us, we assume that we are outside of the ‘rich’ classification — even when the poverty line in the US is living in the top 12% of the world.

    Great article, because it shows that our perceptions and self-discipline with regard to money have more to do with our happiness and satisfaction than the actual size of our bank account.


    • thanks so much for your comment. That article sounds about right 🙂

  4. Jennifer G Jennifer G

    My husband likes to spend money A LOT. All he can see is that we don’t make enough. I’m hoping that as we begin embracing and adopting minimalism that his obsession with buying stuff ALL the time will lessen and he will see that we actually do make enough (if we just stop spending it all), even if I stay home with our children.

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