My electricity bill doesn’t spark joy, and nor does meeting my tax accountant.
Like everyone else, I recently watched Marie Kondo’s “Tidying Up” on Netflix, which got me thinking about money.
Money itself doesn’t spark joy, unless perhaps you work for Macquarie Bank, but neither do some essential kitchen utensils.
But what if you applied her method to your finances?
For those of you not familiar: “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. Keep only those things that speak to the heart, and discard items that no longer spark joy. Thank them for their service – then let them go.”
In the world of our personal finances, sparking joy isn’t really going to cut it (unless you’re really, really into spreadsheets).
So here’s three areas I think we can throw away when it comes to money.
Imagine a clean, organised Marie Kondo-esque house. Now think about your finances.
We don’t tend to think about all our expenses and investments in one go, so it can be hard to get a handle on it.
A great example is to review your debt and make sure to consolidate any expensive debt like credit cards into a lower interest personal loan or your mortgage.
Can you get a better deal on: utilities, phone, insurance, loan interest rates.
Can you consolidate: your credit card debt into a personal loan, your superannuation into one account.
Marie Kondo’s second rule (the first is committing to her method) is imagining your ideal lifestyle.
Imagine that in relation to your finances. Do you overspend or underspend? Where do you waste money?
So sit down, open your credit card and bank statements and start highlighting what experience/purchase/subscription “sparked joy” and added value to your life.
Then cancel anything that doesn’t and spend more on what does.
Premium credit cards ooze status and privilege, but for most of us paying premium for an expensive debt product isn’t really worth it.
If you get value out of your card through frequent flier points then keep it, if not, go find your scissors – and make sure you consolidate any debt into a lower interest personal loan.
And then there’s the rest. Whoever is in your social circle there will be pressure to keep up; whether it’s restaurants, clothes, hype-beast sneakers or expensive cars.
Let’s put these and other gratuitous status symbol into this bucket. If you don’t love it (and especially if you can barely afford it) get rid of it.
Status might give you an ego boost, but it probably isn’t really sparking joy.
Finally, Kondo recommends her method as a process to set you up for life. But unlike your cupboards, your finances should be reviewed, and decluttered, on at least an annual basis.
Stuart Stoyan is CEO of MoneyPlace, an award-winning personal loan provider. Since reading Kondo’s first book ‘The Life-Changing Magic of Tidying Up’, Stuart’s sock drawer now sparks joy.