Financial Literacy - Growing your bottom line
smart spending
4 steps to a simpler (and more frugal) life

"When people hear that, particularly as grocery prices have gone up, they think it's crazy. But it's not if you really look at what kind of foods we should be eating the most of -- fresh fruits and vegetables and whole grains and legumes. When you shop -- if you shop smart -- you can find all kinds of things in those categories that cost under $1 a pound," he says.

By spending less money, you have more money to save and in due course can work less.

"What we are selling is our time, some limited number of hours we have on earth and we're choosing to consciously spend those hours in exchange for money so we can get some stuff," Yaeger says.

Clean house

Getting rid of clutter, both mentally and physically, will help in the process of paring down.

Yeager recommends a "weeklong fiscal fast" to get in touch with your spending.

"Go a week without spending any money. It's a chance to use up the food in your cupboard and the bottles of shampoo from hotels we've all been saving for 20 years," he says.

The spending detox will reveal how most people spend and waste money in a normal week.

"You're really trying to find and pick apart the routines you have that involve spending money. Whether you're prone to going out and buying clothes when you're under pressure at the job, or whether you find yourself going out to lunch every day, you can work to break yourself of those habits," Yeager says.

Once you've cleared your mind of bad spending habits, it's time to clean house.

"It is a matter of appreciating all of the stuff you've probably amassed and it's kind of horrifying when most of Americans see all the stuff that we have," says Yeager.

Jessica Dolan, owner of Room to Breathe Home and Office Organizing, works with people who want to simplify their lives by simplifying their stuff -- moving into a smaller home or cutting up all their credit cards and getting back to basics.

If you don't know what you have and you keep buying and buying because you've lost what you bought the week before, it's a huge waste of money and your time because you keep going to the store or you keep looking for it, she says.

"You're also wasting space in your house or office because you're storing all of these things that you can't find. It's just a vicious cycle," says Dolan.

If you use what you have and spend money only on things you really need, your life, your home and your pocketbook will benefit.

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