The 7 Financial Rules To Lead A Minimalist Lifestyle

Have you heard about the 30 Day Minimalism Challenge? If you haven’t, this is how it goes:

  • Tag a friend to participate with you.
  • On Day 1: Discard one item. On Day 2: Discard two items, and so on.
  • Continue this for 30 days.
  • Basically, declutter your life from all unnecessary things by donating/discarding them.

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Similarly, MissManage is going to show you how to lead a financially minimalist lifestyle (by not compromising) but by simply decluttering your monthly expenses in a ‘smart’ manner. 

Step 1: Reduce Your Cell Phone Bill

Depending on your monthly usage your network provider will suggest a plan covering calls, data, messages and roaming charges best suited for you. But before choosing the plan compare them with other network providers. After Jio was launched, a lot of network providers slashed their prices. (Fun Fact: In economics, this is called as a Price-War). Take advantage of this situation and switch to a cheaper plan. Read Jio v/s Airtel, Vodafone, Idea, BSNL, Aircel – The best data plans.

These quick tips can help you:

  1. Track your usage through apps like My Vodafone App
  2. If you use your personal phone for making work calls, save those bills and get reimbursed by your company for them. 
  3. Compare different ways to pay your mobile bills. Either through debit card, credit card or cash/cheque. Using a credit card means getting reward points which you can spend later. You can also set a date to auto-pay your bills through credit cards. This helps in paying bills on time.

Step 2:  Follow The 50-30-20 Rule For Your Salary

Do not spend everything at the beginning of the month and live precariously towards the end. Follow the 50-30-20 rule: 50% towards necessities, 30% towards luxury items and at least 20% should be saved. Read 8 money tips to help young earners plan their finances by ET, it gives a detailed guide to plan your finances. 

Step 3: Buy Groceries In Bulk

Instead of buying fruits and vegetables on a daily basis, buy them in bulk, because wholesale prices are cheaper. This will help plan your budget for the other items, once groceries are out of the list. You can also shop online at places like Grofers. They have many cashback and discounts deals.

Step 4: Travel Smart

Paying petrol bills with specific credit cards can actually give you more reward points than using a regular card. You can use these points to pay for petrol next time and save a lot of cash. Read 8 Best Credit Cards for Fuel Purchase in India: Benefits, Rewards, Cashback. If you travel by Ola or Uber look up discounts and monthly passes they provide to get reasonable deals. Just like your phone bills, you can also get reimbursed for your travel expenses from your company. Save the travel bills or receipts and give them to your finance head or boss to get reimbursed.

Step 5: Claim Income Tax Exemptions 

Research on the various ways you can claim income tax exemptions and invest in tax- saving options like PPF. Every year the government announces a budget and changes the way an individual is taxed. Keep up with this budget to know the different ways in which you can save extra cash by legally deducting taxes. After doing your own homework talk to your CA because these people will correctly tell you how to figure out your taxes and returns.  

Step 6: Make Wise Financial Decisions 

  1. Rent v/s  Buying a house: Depending on real estate prices, your monthly salary, EMI, etc. you need to decide what you can afford and whats right for you.My-minimalist-challenge
  2. Credit Card v/s Cash: Sometimes paying by credit card is actually better than cash, because swiping your card gives you points which can be used to make other purchases. But sometimes cash payments are better because credit card payments come with additional charges.
  3. Jewellery v/s Investment: Gold prices always rise but they may not be the best investment options. Compare all the options you can invest your money in and then decide.
  4. Working in a company v/s Starting your own Company: Depending on your risk taking capacity, leadership skills, capital requirement and need of income this decision must be made.

These were just the few important financial decisions, there are plenty more which might come in your life, and you must take them after considering all the pros and cons. 

 Step 7: Cut Down On Unnecessary Subscriptions

Realistically we cannot down all entertainment expenses but we can budget them wisely. For example, are you paying for channels you never watch? Do you have a Netflix subscription and a Hotstar subscription and an Amazon T.V. Prime subscription and you watch movies outside? You do not need them all. Make a list of all the subscriptions and cancel those you do not need. 

Same goes for newspaper subscriptions, magazine subscriptions, library memberships that you have but you do not use. Switch to electronic papers instead and invest in a kindle if you love reading. That way you will save money and paper!

Accept this challenge and see how much you can save every month. Tag a friend and ask them to take it up too!

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