My Take on Minimalization: Do What Works for You!

I have come across a lot of blogs and even financial blog posts on decluttering, being a minimalist, and getting rid of stuff. These are all good things. On the other hand a few have taken it to the extreme which tends to backfire for a lot of people (including me!).

Personally I am a huge fun of only having what I need around. I am the type of person who doesn't need 800 pictures on the wall, 300 owl trinkets on shelves, and 1000 books on the shelf. I simply don't see the value in it. I suppose one could call me practical.

I found that after I returned from 18 months abroad having only what was in my backpack was a lifestyle I liked. The problem is that this doesn't translate to a more "normal" life with a full time job, a house, a car, etc. I slowly started to amass more stuff and I was pretty against it in the beginning. I now realize that some of it is necessary to live more comfortably. I am not longer "roughing it" and living with 4 t-shirts.

When I finished remodeling my new (to me) house I had a fair bit of family and friends asking me when I was going to buy furniture, decorate, etc. My answer to them was "probably never" since that stuff was not important to me. Eventually I got free or nearly free furniture, kitchen supplies, and so on. I refused to spend money on this stuff and it has paid off!

Overall I am still anti-stuff. I don't buy anything that doesn't have a specific purpose. I don't keep anything that doesn't have some sort of special meaning to me. Examples of what I do keep: quilts my grandma made, my grandfather's coin collection, family photos (in a box), journals, etc. All of these have memories associated with them. They are things I truly value. For me to keep an item long term it either has to be useful, sentimental, or both. I am not a collector!

I keep my amount of stuff under control by purging. Each year I will pick a room and start clearing out stuff I don't need or use anymore. I sell anything of value and donate or recycle/trash the rest. I believe I am winning the "war on stuff" since I have it under control. Starting with a clean slate after traveling long term certainly gave me a leg up. The moral of the story: Keep what you truly value (not simply "like") and get rid of the rest, slowly.

Pro Tip: Create a "Bills" Calendar on your Computer/Smart Phone

A while back I created a calendar called "Bills" on my computer. This calendar syncs with my iPhone and now I know when all of my bills are due. I have automated the majority of my bill paying but have a few that are not for various reasons.

Regardless if you automate or not this is a useful tool. I have reminders pop up and I can go check to be sure that the automatic payment went through or I just simply make the payment when it is time. This forces me to be aware of my money while still keep it 90% automated and less prone to mistakes.

I also use this to keep track of irregular payments such as insurance. I pay my life, auto, and homeowner's insurance once per yer to get the lowest rate. They are all due in different months. This calendar also reminds me when to send these payments which could be easily forgotten other wise!

Because of this system have virtually eliminated all late fees and associated stress. I don't pay the insurance company's "lazy tax" by getting on a monthly plan. That is just not frugal at all! It took me about 30 minutes to set up and I don't have to worry. Get an new bill? Add it to the calendar. Drop/or change a bill? Adjust as needed!

Organization: it IS worth the time!

I recently had an appraiser out to my house since I am refinancing my mortgage. I did a lot of cleaning and organizing as a result. I found it astounding just how quickly things can get messy and how much time I can waste just trying to find something.

I am now starting a new habit of trying to put things in the proper place when I am done with it. I know this is not always possible so I try to have an "organization day" every 3 months or so where I simply take the time to put things away properly. This is akin to spring cleaning but simply more often. Nothing is more frustrating than spending 2 hours looking for your insurance document when you could have spent 5 minutes to scan and file it digitally as a PDF in the first place.

Paperwork builds up fast and I shred everything I don't need monthly. I hate paper clutter and am as paperless as I possibly can be. I am also getting into the habit of refusing receipts unless I need them and not taking bags if I only get a couple of items. Less clutter means less recycling, less waste, less time spent cleaning, and more productivity!

As a result of making a conscious effort to be more organized you can reduce stress, wasted time, and save money all in one shot. We all want more time and money to do the things we really want to do and staying organized plays a big part in it. The more clutter you have the more overwhelmed you feel--whether you realize it or not!

FREE Calendar syncing for your PC, Mac, and/or Smart Phone!

I have been doing some digging and testing lately to find a good, free calendar system to keep track of birthdays, holidays, vacations, work travel, and all other important dates that I don't want to forget. I found a solution: Google Calendar.

I have been a long time user of Gmail (free) and other Google services but not the calendar until now. They now have the system set up where you can sync your Google-based calendars to iCal (Mac), Outlook (PC) and almost all smart phones (Blackberry, iPhone, Windows Mobile, etc) seamlessly and automatically. You can make a change on any one of the devices which could be your PC, your phone, or online via Google Calendar. It will automatically update in all other places. This is great!

The best part: It is 100% FREE!

Once you get your calendar(s) created via Google Calendar on the web they have very good tutorials on how to set up all of your various devices to work with it. They even have tutorials on the net on how to export your calendars from other systems such as MobileMe (Apple), Outlook (local only), and iCal (local only) among many others.

This is truly a great service that took me about 20 minutes to get set up and going and now I can access all of my calendar data no matter where I am. If you use Gmail you also have the option of adding appointments to your Google calendar (which it can "see" from your emails) and they will of course be pushed out to all of your devices. No more missed dates! Give it a try and I am sure you will wonder why you didn't do this before.

Personal Record Retention Guideline

I must admit that I hate having piles of paper around. I am a big fan of scanning everything and shredding it if possible. One of my pet projects for the past year is to thin out how much paper I have around. I have come up with a general guideline for personal record keeping:

Keep Forever:

• Income Tax Returns (filed copies)
  
• Investment Trade Confirmations
• Retirement plan and pension plan records
• Estate Documents (will, living will, trusts, powers of attorney)
• Social Security Card
• Social Security Statements
• Divorce Documents
• Child Support Documents
  
• Marriage License
• Inheritance-related Documents
• Credit Report Dispute Documents
  

Keep for 6 years:

• Supporting Documents for Tax Returns (W2, 1099, etc)
• Car Accident Police Reports and Claims
• Copies of annual credit reports
  
• Receipts and Bills with Tax Effects

Keep for 3 years:

• Expired or Canceled Insurance Policies
• Credit Card Statements
• Bank Statements
• Brokerage / Investment Account Statements
• Medical Bills (in case of an insurance dispute)
• Utility Bills

Others (time varies):

• Car Maintenance and Loan Records (until sold, includes motorcycles, RV's, etc.)
• Current Insurance Policies (Keep for life of policy + 3 years)
• Mortgages, Deeds, Leases, Closing Documents (keep 6 years past end of retention or sale of property)
• Sales Receipts (For the life of warranty on the product)
• Warranties and manuals (keep for life of product)

Record retention is a necessary step in staying organized as well as attaining financial independence. The majority of the above documents can be kept in digital format so you can save time and space when you need to dig something up. I would retain a digital and paper copy of at least everything in the "Keep Forever" section.

Organizing and shredding your personal records can seem daunting at first but goes pretty fast once you get going. It will save you hours upon hours later when you need to find something. It also allows you to reduce clutter and storage needs. See my PDF Filing System post for more information.