A month into the new year, most of us have made – and perhaps broken – at least a few new year’s resolutions. The usual commitments to lose weight, exercise and eat healthier top the list for most Americans again, but, this year, a new one has crept in – pursuing a simpler life using The KonMari Method™.
Through her hit Netflix show and #1 The New York Times best seller, “The Life Changing Magic of Tidying Up,” founder Marie Kondo is spreading her method for simplifying and organizing your home to create spaces of serenity and inspiration. And thousands of Americans are following suit, with thrift shops and book resellers overflowing as a result. I first became fascinated with this movement when my oldest – and least organized – daughter told me she was embarking on a “KonMari” project of her own. If the message and results are compelling enough to motivate my daughter, the consummate sentimental collector of things, then I realized there might really be something to this.
So, what exactly is KonMari and what does it have to do with our financial lives? A lot, but if you aren’t already addicted to the Netflix show, I should explain a little about the process first. The KonMari Method encourages tidying by category, not by location, beginning with clothes, then moving on to books, papers, “komono” (miscellaneous items) and, finally, sentimental items. Starting with clothes, you must first take every item of clothing and create one massive pile. A typical reaction on the show is to be overwhelmed and a bit disgusted by the excess. That was exactly my daughter’s reaction as she texted a picture of her massive clothing pile to the family. The next step is to take each item, one by one, and determine which bring you joy. Those that spark joy and inspiration, keep. Those that no longer bring a smile to your face, thank them for their service and let them go. A similar process is used for every category of your belongings in your home. The end result is a decluttered, serene, easy to maintain and peaceful home. On the show, viewers see tension evaporate between couples, with families finding time for each other and the things that are truly important in their lives, instead of fighting piles of toys, laundry and clutter.
So, again, what does this have to do with money and budgets? As I was talking with a couple last week about their struggle to direct their spending to what truly matters to them, it dawned on me that we can apply these same principles to our financial lives. If you are working with a financial advisor, you are either well on your way to financial security or you are already there. If you are already there, chances are that you have plenty of money, but it’s not unlimited. Regardless of our net worth and income, we all face choices about how we spend. So, shouldn’t we spend our money in ways that “spark joy”?
Perhaps it’s time to KonMari your budget. Start by collecting all your spending, whether through cash, checking account or credit cards, for the last month (three months is even better). Begin with the total. You may be overwhelmed and disgusted, just as my daughter was with her massive pile of clothes, but recognizing any unneeded excess is part of the process. Next, bundle expenses into like categories. For ideas of categories, you might want to consider tools like mint.com or ask your AFA advisor for some suggestions and tools.
As you look at each category total, ask yourself whether the things or experiences they represent brought joy to your life. Was the spending connected to what is truly important to you, or did it represent something that was simply an impulse, a distraction or something that no longer fits with your vision for your present and future? For the couple I was counseling regarding their stresses about money, they realized their number one priority was travel. With that new focus, they can look at their spending and begin to change habits that keep them from having the money they want to complete their bucket list. For another client facing a similar dilemma, the answer was to downsize. For others, it’s as simple as cutting back on impulse shopping or dining out. Remember, we all have to make choices since no one’s money is unlimited. Embrace the opportunity to use your money to create joy in your life, not stress.
Are you interested in getting started? Here are the six rules for the KonMari Method, which speak equally well to “KonMari-ing” your budget:
The Six Basic Rules of Tidying Up
(With some notes relating to finances from me)
Rule 1 – Commit yourself to tidying up. (Commit to tidying up your spending)
Rule 2 – Imagine your ideal lifestyle.
Rule 3 – Finish discarding first. (Discard those things that don’t fit with your imagined lifestyle.)
Rule 4 – Tidy by category, not by location. (Tidy up one budget category at a time.)
Rule 5 – Follow the right order. (Start with the highest impact/largest dollar amount items first.)
Rule 6 – Ask yourself if it sparks joy. (Ask yourself if your spending sparks joy.)
The result should be a financial life that is peaceful, stress-free and connected with the things most important in your life. Remember that your AFA advisor is ready to help with this step in making your life’s journey richer.