A couple of years ago, my husband Chris went on a big decluttering kick. He’d already been a long-time minimalism enthusiast, so when he came across “The Life-Changing Magic of Tidying Up” by Marie Kondo, it kicked his desire to “tidy up” into high gear.
Unfortunately for him, he was stuck with a partner (me) who recently had a second baby and was not in the mood to anything else “,” thank you very much. But he went ahead tidying up on his own, giving me a pretty thorough overview of the book’s philosophy in the process.
Now the popularity of Netflix’s “Tidying Up With Marie Kondo” has re-highlighted the appeal of the KonMari method. This program provides a structure to tidying up that addresses both the practical side of cleaning up and the emotions that keep us holding onto things we no longer need.
That also makes this tidying philosophy a smart method for cleaning up and organizing your finances, too.
You can use the principles of the KonMari method to guide a cleanup of your finances. Doing so can get rid of financial clutter, and create a money management system that’s easier to use and gets you closer to your goals. Get started with these 12 Marie Kondo-inspired tips to tidying your money.
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1. Visualize your successful outcome
Kondo asks you to start your journey by imagining what the process will bring into your life. Tidying up “gives you an opportunity to really reflect how you want to live your life, and what you want to have in it,” Kondo told Refinery29.
“The question of what you want to own is actually the question of how you want to live your life.
“Tidying is just a tool, not the final destination. The true goal should be to establish the lifestyle you want most once your house has been put in order.”
Marie Kondo, “The Life-Changing Magic of Tidying Up”
To know if how you’re managing your money matches the lifestyle you want, you need to get clear on exactly what your desired lifestyle is.
Spend some time thinking about your ideal life. What does it look like — and what’s going on with your money to make that happen? Does it involve less financial stress, paying down debt, spending with more intention? Do you crave more security to help you and your family feel safe? Or more financial freedom to travel and have other life-affirming experiences?
If you can imagine your financial destination, as Kondo points out, then you can see the best way to use your tools (finances and tidying) to get there.
2. Face your financial mess
If you watch even one episode of “Tidying Up With Marie Kondo,” you’ll notice a trend: when they actually see how much they own, most people are shocked.
Too often, we store away belongings as a way to avoid dealing with them. Or as Kondo puts it, “Putting things away creates the illusion that the clutter problem has been solved.”
Our finances can be the same way — people avoid looking at money matters because dealing with them directly can highlight some uncomfortable truths. It requires facing, in the cold light of day, where their money decisions and habits have led them.
But ignoring your finances doesn’t change the reality of your situation. And it can actually make things worse. When you don’t know what’s really going on with your money, you can end up stuck in what you imagine instead.
One person could wind up overly optimistic, living in a land of financial unicorns and rainbows — but it’s actually more like Mordor. They spend more than they earn each month and sink deeper into the red all the time. At the other end of the spectrum, someone could be paralyzed by their finances, constantly expecting the worse and worrying about what their money is doing because they can’t bring themselves to actually look.
3. Review finances by category
Getting it out in the open is the first step to facing some financial fears that are keeping you stuck in your money mess.
So set aside some time to really review your finances, brace yourself with some courage and coffee, and pull the trigger. Here’s what you’ll need to collect to get a full picture of your finances:
- Income: Exactly your take-home pay and benefits; if your income varies, get an average based on the past six months
- Budget: Full list of fixed costs and discretionary expenses
- Deposit accounts: The balances, interest rates, and fees for each of your checking and savings accounts
- Debt: The balance, monthly payment and interest rate of each debt you owe
- Credit: Request a free credit report and check your score
- Retirement and investments: Review all retirement accounts and stock holdings
- Tax information: Review tax returns, forms, or documents and revisit your paycheck
You can take a full financial inventory at once. Or, you can go through by each category to review and organize one area at a time (as Kondo advises).
4. Ask, “Does this spark joy?”
Facing the reality of your finances can be overwhelming and even panic-inducing. But this is also your opportunity to evaluate your finances and pare down the clutter, consciously adjusting it to what’s appropriate for you and the life you want to create.
As your review each category of your finances, consider using Kondo’s ultimate guide for deciding what’s worth keeping in your life:
“The best way to choose what to keep and what to throw away is to take each item in one’s hand and ask: ‘Does this spark joy?’ If it does, keep it. If not, dispose of it.”
Marie Kondo, “The Life-Changing Magic of Tidying Up”
If you’re reviewing your paystubs, for example, you could take a look at all the benefits you’re paying into. Review and decide if you’re getting joy and use from each of these benefits.
For your budget, you can review expenses and note which ones bring you joy, a sign that you’re getting value for what you’re spending. You can also mark off costs to get rid of because they don’t bring you joy — such as your continuously neglected gym membership.
5. Find the joy in necessities
Of course, there are some things you keep around not because they “spark joy” but because they’re necessary.
Kondo told Refinery29 that it can help if you shift your feeling of “joy” not to the item itself but what it helps you do. Your auto loan might not fill you with the same joy as your growing savings account for instance — but having a car with which to drive to work probably does.
“What do you make happen with them? Because for instance, with a hammer, it helps you build things or tongs, they help you cook. So when you look at it that way, they do contribute to the overall happiness in your life and so it’s very important to value them.”
Marie Kondo to Refinery29
6. Discard what’s not joyful or useful
The first step is to discard those things that aren’t bringing joy and aren’t serving you. card you almost never use with an $80 annual fee? Closed. Checking account with the bank that reorders your deposits and purchases to charge you more overdraft fees? Outta here.
Of course, not all financial liabilities or accounts are as easy to throw out as a shrunken, pilly sweater. It’d be nice if debt were as easy as dumping it at a nearby Goodwill. But if you notice your car loan annoys you, you can take steps to speed up repayment and get rid of it faster.
7. Consolidate redundant accounts
You can also take a look at your finances and consider if you might be able to combine your accounts to simplify them. For example, maybe you never rolled over your old 401k. Do that now to combine and simplify your retirement savings. Or you might want to combine and consolidate credit cards with a balance transfer.
You can also weed out old financial products that no longer meet your needs, such as checking accounts with high monthly fees and overdraft costs or a car loan with high rates. Make a note that it might be time to shop for a replacement bank account or refinancing product with lower costs or better features.
8. Optimize your money for your desired financial behaviors
For Kondo, “storage should reduce the effort needed to put things away, not the effort needed to get them out.” In the same way, your financial storage should facilitate the behaviors you want (saving) and minimize behaviors you don’t want (such as overspending).
So you might set up automatic savings transfer and keep your savings in an account that’s not tied to a checking account, so it’s harder to touch. For spending, you might make a point of only keeping only one card in your wallet that’s tied to a checking account with your “safe to spend” money.
9. Use better financial tracking tools
On an ongoing basis, you can use many tools to organize your money so it’s simple and easy to see. It’s a similar concept to Kondo’s folding method, in which clothing items are neatly folded to stand vertically so you can easily find and retrieve exactly the item you want.
You want to put a similar system in place with your money — something that makes it easier to see at a glance what your finances are doing so you can make decisions based on this up-to-date info.
Personally, I use a spreadsheet to set up my budget with spending categories and targets, so I can make sure it’s realistic. Then I use an expense tracking app, such as Mint, to keep an eye on ongoing spending and check in to be sure my spending is in line with my targets. If not, I can scale back on a category (such as eating out) until the month is over and I have a fresh start.
10. Adopt a “tidy money” mindset going forward
A big part of Kondo’s tidy mindset is to always take the right action at the right time — specifically, putting things away immediately after use.
She even talks about this in terms of financial items. Any time you receive financial mail such as an invoice or bill, she recommends addressing it immediately instead of letting it pile up. That way you know it’s paid and it’s not hanging over your head. You can then file or throw away the bill or notice guilt-free, and you also have one less financial task cluttering up your mental to-do list.
11. Trade guilt for gratitude
Ultimately, the KonMari method can help you find a new way of viewing your things — including your finances. Shifting your attitude about non-negotiable expenses, like bills, can help you see them in a new way. You can more easily let go of the habits and accounts that aren’t serving you, and better appreciate what is.
You can let go of guilt over past financial mistakes and instead view them lessons learned. Maybe you’re still paying off the expensive new car you bought right out of college. Consider what that taught you — that you hate being in debt or just really prefer a sensible sedan. It may have been a hard-earned lesson, but viewing it in this way places the value on learning and growing rather than managing money perfectly.
Instead of feeling frustrated by all your expenses, you can start seeing all the “joys” those costs bring. For your rising utility bill, you can be thankful for the lights in your home or the heat you enjoy in the winter. For that auto loan, you can feel gratitude that you have a reliable method of transportation to work.
12. Transform how you view yourself
The KonMari method might seem like a lot at first (I’d be lying if I called it easy for everyone!). But it can be a liberating approach to handling your possessions and your finances.
More importantly, it can help transform the way that you view yourself.
“The space in which we live should be for the person we are becoming now, not for the person we were in the past.”
Marie Kondo, “The Life-Changing Magic of Tidying Up”
Tackling your finances is sometimes a frightening process, but doing so can help you reframe how you view yourself. You can start seeing yourself as someone who’s empowered by their finances and intentional with money. You can both feel more like the person you want to be, and build a life that’s closer to your ideal.
Featured image courtesy Dan Gold via Unsplash.