I like Baker’s 42 Ways to Radically Simplify Your Financial Life. Each one of the suggestions in his article is absolutely relevant and rewarding on its own, but together the tips form the quadragintaduo-fecta of financial simplicity. Although I love the number forty-two for reasons obvious to Douglas Adams fans, doesn’t it seem a little, well, complicated for a theory of simplicity?
Simplicity boils down to one concept: eliminate anything that is unnecessary. If you take this mantra to heart, build your personal philosophy around it, and keep it in mind when you make every decision, there is no reason to follow a list of suggestions. The answers will be obvious — any choice that fits the philosophy will be the correct choice to make.
I’m not an expert in the concept of simplicity. All I have to do is look around my apartment and evaluate my life to see that much of who I am is overly complicated. But I’m not someone who believes in extremes. Any philosophy can be taken to that point, but for what advantage? I suppose I could live the life of a hermit in the wilderness, finding my own sustenance and operating outside of and independent of society. With this life, saving as much money as possible wouldn’t be a goal because no money would ever be necessary.
If we accept the premise that simplicity as an overall concept is a good idea, we can use it as a guide rather than an absolute rule. We then decide the level of simplicity that is acceptable to us. Now that we have simplified simplicity to its core, “Eliminate anything that in unnecessary,” we have to decide the meaning of “unnecessary.” And thus, we add a layer of complication.
Here’s what you need to ask yourself to achieve this:
- What are my values? Values are broad concepts that explain how to behave. Family, faith, and independence are popular values, but there are many others, like education, joy, reputation, health, and meaning.
- How do I prioritize my values? Some are more important than others, so more time should be spent concentrating on the values at the top of this list.
- What aspects of life directly conflict with the most important values? Here is the first set of candidates for elimination. If health ranks highly for you, it would be a good idea to put down the cigarettes and the doughnuts and get in shape.
- What aspects of my life do not correspond to any of my values? Reading trashy novels makes sense only if mindless entertainment is one of your values. If not, eliminate.
- What aspects of my life correspond to my values but can be replaced or reduced? It’s possible to do too much. I admit that entertainment, though not mindless, is not my top value but it is an important part of my life. But I do watch too much television, and I would benefit from watching much less.
There we have five questions to help guide someone on a path to simplicity. Following this path will help us achieve success financially and spiritually. The concept of simplicity should be true to itself, with just the one theme of eliminating all that is unnecessary. Breaking down the concept into detailed steps or suggestions can be helpful, even if a little ironic.
As with any major concept, a goal of simplicity is only a guide and will never be attained in its fullest measure. Each step on that path will bring us closer to the goal, so don’t wait before enjoying the journey.
Baker: For those of you that don’t know, Flexo is one of the oldest (started in 2003) and most well-respected members of the personal finance community. In particular, his transparency in his monthly Net Worth updates (going back forever) inspired my own financial transparency.
photo by lbolognini