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The KISS Principle

Continuing on from my post about "The best time to start is now", I'm going to expand on the concept with the KISS principle

The KISS principle is something that I "try" to live my life by.  No, it's not about kissing girls (or is it?), KISS in this case stands for "Keep It Simple Stupid".  Finances, or even life in general, is much easier and efficient if you keep it simple.

Peter, from Plan Your Escape, left a comment indicating that the best way to manage your finances is to keep everything simple.  Here it is again:

I think one of the things that prevents people from getting started with improving their finances is spending too much time trying to figure out the "best" or "optimum" thing to do. They get caught up in calculations and complex strategies to try to shave a tiny bit off their debt or to squeeze an extra 0.5% return out of their investments over 20 years.

For most people it's much better to just do "something" and (like you say) do it now. Anything at all to get them headed in the right direction is better than agonizing over whether you'd be slightly better off buying or renting, or contributing to an RRSP or a TFSA, or investing in fund X versus fund Y.

Just start saving, paying off your debt, reducing expenses and worry about the complicated stuff later.

Then GatesVP adds:

If you're new to this and you've decided to turn your financial life around, just pick the worst financial offender in your life and fix it up. Rinse and repeat. Expect to be at it for a year or two, especially if you have a complex life with kids and cars and mortgages and two jobs and credit card debt. 

So like the readers mentioned above, if you have a money problem, hack at it one at a time.  If you have analysis paralysis (as I often do), if the choices will achieve close to the same result, dive into one option.  The key, I believe, is to do something and to keep it as simple as possible. 

photo credit: kartik_mistry

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FT About the author: FT is the founder and editor of Million Dollar Journey (est. 2006). Through various financial strategies outlined on this site, he grew his net worth from $200,000 in 2006 to $1,000,000 by 2014. You can read more about him here.

{ 7 comments… add one }
  • Peter @ Plan Your Escape April 17, 2008, 10:46 am

    Thanks for the mention FT.

    After giving this a bit more thought, I think the only time you can *ever* start something is now! So why wait?


  • squawkfox April 17, 2008, 1:14 pm

    Indeed. Start today. There’s no time like the present! The only challenge is…a spouse who likes “tomorrow”. ;)

  • JR April 17, 2008, 2:03 pm

    lifes lessons learned in kindergarten (KISS)… one step at a time, I totally agree.

    With personal finances it is no different than fixing a leaky roof, muffler, relationships, toothache even a career change … easy fixes, ermm well!

    Funny how people think lifes financial journey is not important until they arrive at the destination

  • moneygardener April 17, 2008, 10:10 pm

    Absolutely…good point…

  • Archanfel April 18, 2008, 10:13 am

    Well I agree that you should start early, I don’t think one should jump into investment without a concrete plan. Without a plan, people tend to forget temporary parked money during good times and panic during bad times. They are the perfect preys for financial advisers.

  • paulette April 19, 2008, 10:47 pm

    I agree better start saving for the future. We never know what happens next. At least we are prepared for it. Better prepared that sorry.

  • Dividendgrowth May 2, 2008, 1:16 pm

    I am always fascinated when a person can communicate a very complicated thing with simple words/simple language. I myself like to over emphasize on structure in order to make me look/feel important ;-)

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