8 Minimalist Money Rules You MUST Follow to Always be Financially Stable（原声文稿）

So, I have a friend who makes really good money, like high six figures.

She lives in a gorgeous apartment, drives a really nice car, is always dressed to the nines.

But if you go over her house, you would see that she probably shops a lot.

Her closet is full of clothes, a lot of them with the tag still on, and her kitchen has a lot of gadgets that she maybe has used once or twice.

Despite all appearances, she is also two paychecks away from financial panic. Then I have another friend, let's call her Summer. summer.

She is a school teacher, she makes 60 grand, and if you walked into her apartment, you'd notice one thing immediately. It's small, it's clean, it's perfect for her. The thing is, summer always has money. And actually, she just got back from yet another trip.

Same city, same cost of living, but the friend who's earning half as much is actually the one who's more free.

So financial stability was never really about income.

It's about a handful of minimalist money rules, followed by people who always have money.

See, there's a pattern I see all the time with people who earn good money but have nothing to show for it.

They completely forget about one very simple but game -changing financial concept, which is that everything you buy costs money three times. The first cost is obvious. It's the price tag. It's the number that you swipe on your credit card.

The second cost is the maintenance cost. Everything you owe needs some place to live.

So those clothes in your closet, the Peloton in your living room, those are actually taking up space in your apartment and you pay rent for your apartment. it. You're actually like paying rent for your things.

And then you have to pay for insurance and then repair it.

Take your clothes to the dry cleaning, et cetera, et cetera, et cetera.

And the third cost is the biggest one of all, which is the opportunity cost of not having invested that money because every dollar you spend on stuff is a dollar you didn't invest and therefore isn't growing for you.

So if everything costs money three times, how do you know when something is actually worth it?

That can be answered by rule number one, which is to calculate cost per use before any purchase.

Cost per use is useful because the price tag lies, but when you divide the actual sticker price, divided by the number of times you've used it, you get cost per use, which is a much more useful measure that tells you how much something actually costs.

So the $600 really good quality coat that you wore 100 times, that's $6 per use.

But the $60 fast fashion jacket that you bought on impulse, if you only wore that twice, that's $30 per use.

So, I always say, math it up, and I don't mean to be cheap, because as cost per use can often tell you, cheap can be expensive and expensive can be cheap.

So, you know how when you used to live in a smaller place, you had a certain amount of stuff?

Then when you moved to a bigger place, for some reason, you acquired more stuff.

The tendency is for your stuff to keep multiplying no matter how big your place is. And there's actually a law that explains why.

Parkinson's law, which was originally a theory about how work expands to fill the time you give it can also be applied to finances.

Just like if you give yourself three hours to complete a task, you're gonna procrastinate, check Instagram, go get a snack, and you're gonna take three hours to do it.

But if you had one hour to do it, get it on deadline, you'll get super efficient and focused, drink some coffee, and get it done in an hour. It's the same with stuff, and it's the same with spending.

If you give yourself a huge house, you will fill it up with stuff.

If you give yourself a thousand dollars to spend, that's what's sitting in your checking account, you are going to find a way to spend all that money.

Possessions expand to fill the space you have.

Spending expands to consume the available money that you have.

Back when I lived in a camper van full -time, I had such little stuff, like all of my clothing fit into these two little upper cabinets, and I had one instant pot that was the biggest application appliances have expanded. It's Parkinson's Law. But does that mean we're all doomed? No, there is an easy fix for this. Minimalist money roll number two.

One in, one out. If you You want to buy a new jacket? Buy the jacket.

But one other item of clothing, something in your house that you aren't using needs to go.

The one in, one out rule forces a conscious trade each time and this will quietly kill that mindless accumulation.

Personally, I wish I'd followed this rule before I ended up with three pairs of white sneakers.

Which brings me to the next rule, how to deal with everything you've bought already.

So last year, if you lived in LA, you remember the wildfires.

That was a really scary time. a lot of us evacuated and some people even lost their homes.

That was truly my first time ever experiencing something like that and it really got me thinking.

If my house burned down, if I had to leave so that I would not catch on fire, what are the things that I would grab? Really the answer is nothing.

I would just grab Jupiter and myself and get the f out of there, but if I had a little more time, what are the things that I would grab?

My laptop, my passport, my phone, and then if I had some more time, maybe I would have time to gather some of my more favorite clothing clothing items, handbags, photos, sentimental items. You get the picture, right? My point is stuff is just stuff.

At the end of the day, what we really, really need is not much.

So with that frame in mind, I wanna tell you about rule number three, which is the replacement test.

Walk through your place and ask yourself one really honest question about everything you own.

If your place burned down tomorrow, would you actually go out and spend the money to replace that thing?

Like seriously, carve out a Saturday afternoon to do this. It's really eye -opening.

If you've used the item at least once in the past year, or you have concrete plans to use it within the next year, or none of the above, but you truly just love the thing.

Like, it sparks joy, as Marie Kondo would say. Then, chances are, you actually might replace it. It passes the replacement test.

The thing is, you try this replacement test, and you'll see a lot of the stuff in your house is there, not because you use it or love it, it's there because of just inertia.

It's the remnants of past decisions past versions of yourself past hobbies that you have or hobbies that you hoped that you would have But you never really adopted stuff that you hope to use stuff that you bought during a really fun Experience that was like a heightened emotional moment But then you completely forgot about when you got home This happens a lot on trips when you buy like souvenirs little cute things at the artisan market also happens to me a lot at music Festivals with all the fun clothing vendors camping equipment the list goes on and on I like to think of everything we own in our life as having this like energetic cord coming out of us because it's still something that you have.

It's taking up space. It's something that you have to think about. You have to organize it.

You have to clean around it. You have to take care of it. It takes mental load, but it gives you nothing back.

So anything that is literally an energetic vampire and adding nothing to your life, donate it, sell it, toss it.

You will find that you feel energetically so much clearer and you'll find that you spend a lot less time like rummaging through your stuff to look for things.

The goal isn't to own nothing, it's to only add things that add value to your life.

All right, and minimalist money world number four is to make it inconvenient to spend and really convenient to save.

If you've ever wondered why after a long day of work, you're sitting on your couch, it's 9 p .m., why is it so easy to just go on your Amazon app and check out on another $100 worth of purchases?

Like why is it so easy to order DoorDash and spend another $50 on another weeknight?

So here's the thing. Human behavior always takes the path of least resistance.

We are wired to conserve energy. It's an evolutionary survival tactic.

So if spending is easy, you're going to spend. If saving is easy, you're going to save.

So stop hoping for willpower and motivation to one day show up to get your finances together because you can't out -discipline how you are just wired as a human being.

The trick is to change your environment instead to work with your behavior rather than against it.

If you have trouble saving money, there is nothing wrong with you.

It's that your environment just makes it really easy to spend.

So the trick is to make spending a little bit annoying, a little bit less easy to do.

One idea would be to delete DoorDash and Amazon from your phone so they have to open your laptop and that's an extra step that you can't do just while sitting on the couch. Unsubscribe from marketing emails and text messages.

You're not going to feel FOMO about missing a sale if you never hear about it. Don't save your credit card in your phone. 9 times out of 10.

If you have to go find your card to enter your card details manually, you will leave the item in your cart, and then you probably won't even remember that you wanted to buy it.

Do the math on that, repeat it over years and years. That is tens of thousands of dollars over your lifetime.

The flip side of this is to make saving easy, make it automatic, split out your paycheck so that a percentage of it auto transfers to your investments.

That way the money gets siphoned away somewhere you won't even see it.

And trust me, I've done this every single month and girl, really the dollars start to stack up.

One really easy place to start is if you have a 401k at your job, increase the percentage of contributions taken out of your paycheck.

These little environmental shifts hack your own behavior.

They eliminate the need for willpower, which let's be honest, who has a lot of that? I certainly don't.

And this will beat willpower, discipline, and trying to muscle through it every single time. Set it up once and the right choice makes itself.

As a side note, the people around you are also part of your environment.

So make sure you curate that just as much as you curate what apps you have on your phone.

It'll be much easier to save and invest if you have friends who also care about financial stability versus friends who never talk about money and are more concerned with looking cool and yoloing it up.

Minimalist money roll number five is to never make any upgrades out of boredom.

Like your phone works, your laptop is running fine, your car takes you from point A to B with rarely any issues, but the new model has heated car seats and your current car seats are not heated, and suddenly you need a new car.

When you make upgrades like this, it looks like you're moving on up in the world, but it's also a perfect way to destroy your wealth and just stay on that consumption hamster wheel forever.

Companies have to launch a new thing every year in order to keep driving sales.

That's their whole business, otherwise they have nothing to hype up, nothing to keep selling you.

That's why the new iPhone model released every year, it's such a big deal, right?

But really if you look, the actual jump from one model to another has been marginal.

Like the latest iPhone model now has a 40 X zoom. Like really? Do I really need that?

Maybe if I want to post about that ant crawling across the floor and put that on my Instagram stories, but until then the phone that I have is actually working fine.

And the back of it is cracked, but you can't even tell because I've got a case on.

So until this actually breaks, I am not going to replace it.

When you can't make calls anymore, you can't send text, you can't open your apps anymore, then it's time.

The average person upgrades their phone every three and a half years.

And that's usually while the old one is still working fine.

Over a lifetime, that's $20 ,000 on phones alone.

Now stack this in every category, cars, apartments, TVs, furniture, and now you're easily past $200 ,000 over a lifetime. That's like a down payment on a house. Okay, so true story.

I once bought a surfboard and this expensive ass wetsuit. But you I want to know how many times I've used it, four times. And it's been five years since I last used it.

Closets and garages everywhere are basically like graveyards for the person that you hoped to become, the healthy girl routine you hoped you would stick to, the hobbies that you thought you wanted.

Now, to be fair, I was really into surfing at the time and I was living in Mexico, so I had access to a lot of great beaches where the water was warm, but like most people, I got really enthusiastic about something for about two months and then I just sort of forgot about it. It faded. Some hobbies really stick.

For me, dancing has been a theme that I never really got sick of throughout my life.

That's why it's best to really test your enthusiasm for longevity before investing in the whole ecosystem.

If you're interested in a potential new hobby, so whether it's camping, painting, baking, ask around your friends.

Chances are someone in your friend group has equipment sitting around that they would be happy to lend you.

This actually happened to me with roller skating. I borrowed my friend's skates. I wanted to see if I liked roller skating or not, and turns out I like it. And you know what?

My friend actually ended up giving her skates to me. Another great example is Newly.

This is a clothing rental service that I absolutely love, not a sponsored post, but you basically get six new rotating items every single month, and if you like it, you can buy it for a really cheap price.

That way you get brand new outfits every single month, but you own almost none of it. This is what I mean by less stuff, more life.

Next up, this is the rule that makes every other rule on this list 10 times easier, but almost nobody does it. And that is to define your enough before you start earning.

It's very common for someone who earns $200 ,000 to feel just as broke as they did as when they were earning $80 ,000. Why?

Because they never clearly defined their enough.

With every raise comes a new car, a better house, a better clothing, better closet, better everything, and the goalposts just keep sliding farther and farther out. This is classic golden handcuffs.

Without a finish line, you will never feel free no matter how much you earn. So you flip it.

Define your enough in advance before the money starts coming in.

For me, my definition of enough is a home in LA, somewhat close to the beach, it's fully paid off and passive dividend income that covers my essential living expenses so that I am 100 % work optional.

Like that is my enough point and I'm working towards that. I have something specific and concrete to work towards.

Think about the lifestyle that you want, do a little research, and actually come up with a specific monthly number.

How much income do you actually need per month to fund this enough lifestyle?

So find out your enough point and work towards that otherwise every spending decision becomes sure why not if you do find Your enough point at say a hundred thousand dollars when you start earning at hundred fifty thousand dollars Well, now you have fifty thousand dollars to save and invest and go directly towards financial freedom Compare this to the typical person who never defines their enough point earns a hundred fifty thousand dollars But also spends a hundred fifty thousand dollars And they constantly keep upgrading their lifestyle because all the cool kids are doing it rinse and repeat until dead And now for the last rule, measure wealth by optionality, not by stuff.

People who always have money, rather than measuring their wealth by what they have, they measure it by how much freedom they have to choose.

The freedom to choose to walk away from a job or a relationship that sucks.

The freedom to say yes to things you actually want to do, instead of living a life dictated by your bills.

Someone who makes $80 ,000 but spends $40 ,000 has a lot of freedom. They can take a risk to start a business.

They can take a year off to travel or to write a book.

They can take time off to have a baby. They can change their whole life.

But someone who's earning $200 ,000 and spending $195 ,000 has zero freedom, zero optionality.

That's why the gap between what you earn and what you spend, that is your margin. That is your freedom and your optionality.

One of the highlights of my life is when I took three months off to travel full -time in my camper van.

Once you get a taste of having enough financial margin to do what you want, when you want, how you want, where you want, there is no amount of stuff that makes it worth giving up that freedom.

That's when you enter that virtuous cycle of spending less and saving more, loving how that makes you feel so you spend even less and you save even more.

There's also the vicious cycle.

This is where you spend a lot, save very little, so you feel stressed and insecure, which makes you spend even more and save even less and on and on and on. But you know what?

It doesn't matter how you've managed your money in the past. All that matters is what you choose from this point on.

You can flip your financial future starting right now and every rule in this video is designed to help you do just that. So remember my two friends from the start?

The six -figure earner versus summer the school teacher? The difference was never the income.

Summer bought options, the other girl bought stuff and only one of them is actually free.

So there you go. It's time to go master your money and create a life on your terms.

Thanks for watching. You might like to check out this video next and I'll see you in the next one. Bye!