Minimalism and Money: Trends in Decluttering Your Wallet

Minimalism is a philosophy that can be applied to many parts of your life. That includes your finances, where a minimalist approach could help you save time and reduce stress about money.

If you'd like to try this yourself, you're not alone. About two-thirds (63%) of credit cardholders said the pandemic inspired them to start "pandemic purges" in different parts of their life, according to a Wells Fargo survey. Among that group, 33% reported that they planned to declutter their finances.

Popular financial advisors also tout the benefits of a "less is more" approach. Ramit Sethi, star of How to Get Rich on Netflix, has long recommended that you fight for simplicity in your finances.

From streamlining your accounts to your wallet, here's what you can do to declutter your financial life.

Consolidate your accounts

One of the reasons people's finances get cluttered is because they have too many accounts. It's hard to keep it simple when you have eight credit cards and six bank accounts that you use every month. This is also how you end up with a wallet stuffed full of credit and debit cards. If you have quite a few accounts to manage, consider closing some of them.

The easiest option is to stick to:

• One checking account
• One high-yield savings account
• One or two credit cards

You might not want to consolidate that much. I get it -- I have over a dozen rewards credit cards and several bank accounts because of the benefits they offer.

Another option is to have a few primary accounts that you use the majority of the time. For example, I mostly use one checking and one savings account for storing my money. Most of my spending goes on one credit card. The rest of my accounts I only use occasionally, on an as-needed basis. With something like my hotel credit card, I only use it for spending at that hotel, so it's not one I carry around with me.

Using fewer accounts means you don't need to spend as much time reviewing them and making payments. You're also less likely to miss payments and get dinged with late fees when you have fewer monthly payments to make.

Use a digital wallet

A digital wallet is an app you can use to store your payment cards on your smartphone. Some of the most popular options are:

• Google Pay
• Apple Pay

Digital wallets are great for convenience and decluttering your wallet. You can store all your cards in your digital wallet instead of carrying them with you. Then, you can pay with any of those cards using your smartphone. This is ideal if you like to use multiple cards to maximize credit card rewards. You can have your gas and groceries card, your dining card, and so on, all stored in your digital wallet instead of your physical one.

Not all merchants accept digital wallets, but many do, and acceptance is becoming more and more common. For example, Apple Pay is now accepted at over 85% of U.S. retailers, according to Apple.

There can be situations where a merchant will accept a physical credit card, but not a digital wallet payment. I recommend carrying at least one credit card just in case.

Only carry the essentials in your wallet

Once you've consolidated accounts and loaded up your digital wallet, it's time to turn your attention to your physical wallet. Start by taking out everything. Decluttering a wallet isn't exactly a big job, so you might as well start from scratch.

Next, ask yourself: What do you really need to carry around with you? My rule of thumb is to only carry what I plan to use every week and what I may need in an emergency. In practice, that means:

• An ID card
• A debit card for withdrawing cash
• A credit card to pay for purchases
• Cash for emergencies and merchants that don't accept cards

That's only four things. You may have more you need to carry around everyday. Maybe you need your membership card for the gym, your grocery store of choice, or Costco. Do your best to downsize where you can.

Also, try looking for alternative options with any membership cards you carry. Some grocery stores offer smaller loyalty cards that hook onto keychains or let you enter the phone number tied to your account at checkout so you don't need to bring your card. Costco offers a digital membership card through its mobile app, and there's also a Costco Anywhere Visa® Card by Citi you can get and use as your membership card.

It's good to see where you can simplify your finances every few months. From personal experience, I've found that occasionally closing accounts has made everything much easier to manage for me. I also downsized from a traditional wallet to a slim one a few months ago, and I'm so happy I did. I haven't missed anything, and it's great not having a bulky wallet taking up space in my pocket.

If you feel like your wallet or your finances as a whole could be organized better, try putting those tips into action. They don't take long, and they can make a positive impact in your life.