What’s important?
I put four words in front of you – stuff, money, work and life. If I ask you to put them in the order of importance, what would the list look like? Conceptually, you are likely to put your life first as the most important and stuff the least important, right? Somehow when it comes to actual living, many of us don’t seem to reflect that order. Let’s expound on that.
“Too many people spend money that they haven’t earned to buy things that they don’t want, to impress people that they don’t like.” – Will Rogers
A couple of years after having settled in Vancouver Canada as our new home, I was introduced to a book called ‘Your Money or Your Life’ by Joe Dominguez and Vicki Robin. The book, like many good sages, inspired me to reflect on my life and even more importantly transformed some of my relationships. I am grateful for the authors and the friend who introduced the book to us.
1. Relationship with Money
Money should work for you, not the other way around
This simple statement deserves attention. Money should work for you, not the other way around. If you work now to make your ends met, you are currently working for money. Money is what money does. It buys stuff that you need and want in life. Money is simply a means to an end. It is not the end in itself. Yet, most of us live our lives as if money was a means in and of itself.
The relationship starts changing when you have more money than you can spend and you start investing the surplus. You can start building assets, which will eventually grow enough that their dividends start paying all of your living expenses. You no longer need to work for money at all.
Mastering your relationship with money is key to your best life
We can choose to continue to work because the work provides fulfillment and joy. It may or may not pay you money but it is no longer important. Realizing this money-life relationship is important. If we want to live a life on our own terms, we must master our money relationship. A lot of us put under undue stress on ourselves and feel forced to work for most of our lives because we don’t have the right relationship.
2. Relationship with Work
Work over Life? Really?
Born into a ‘Work is Everything’ society and culture, I had an almost religious relationship with ‘work’. Korea might be a bit more intense when it comes to work, but in North America too, our society sanctions and promotes ‘work’ over life and what is really important in our lives – family, friends and even values and beliefs. Yes, we justify this kind of ‘work ethic’ by saying that the job supports our families. However if our work deprives us of time with our family, then what good does it do?
Do you let work determine your worth?
We let jobs define us and justify the sacrifice. Job titles and how much money we make often define our self-worth. Should it? Must it? I realize that this might still be true by North American societal norms and values, but it doesn’t have to be true for you. What I like to hear at my grave ‘Scrooge style’ is what a kind, inspiring, empowering and loving person I was. Not that I was a CEO of some corporation, or made six, seven figures in salary. Unless my work/job allows me to be the kind of person I’d like to be, then the job doesn’t serve me any purpose other than making money, which I sorted out above.
This realization that work doesn’t need to define me was another key liberating factor in my journey to build my best life.
3. Relationship with ‘Stuff’
The things that I buy must align with my values
One of the fundamental questions that ‘Your Money or Your Life’ suggests that you ask yourself is if a new purchase aligns with your values. Whether you decide to buy a new item or not, who you buy from, you ask the simple question.
Is this purchase aligned with my value?
What value am I trying to reinforce if I am buying the fourth pair of boots or sixth pair of black pants?
When asking these questions of myself, I realized that my consumption was not aligned with my values. I valued (and still value) human connections, sustainability, animal welfare and treading lightly on the planet. Yet my consumption behaviour didn’t reflect these values at all. With this recognition, my consumption began to change.
I was buying stuff because I could, not because the item was really needed. And I didn’t think about the consequence of my consumption. The concept of ‘voting with dollars’ set in. If a company has a record of putting profit over people, we would boycott them. I recall watching the documentaries “Bananas!* and the sequel “Big boys gone bananas!*” by Swedish filmmaker Fredrik Gertten. Well, subsequently, we stopped buying anything from Dole and we still don’t.
Substance over vanity – Approvals that I seek
Evaluating my consumption, I recognized that compliments that I received from friends and colleagues also had a reinforcement value. “Is the blouse new? Where did you get it? It looks great!” “Are those new shoes? Wow, they look very stylish.” We all like approval, a sense of belonging and compliments play a role in our self-confidence. The question is what kind of approval we are seeking. Someone who always valued substance, and never vanity, the compliments that I sought was baring my soul of vanity, rather than a woman of substance.
I no longer need compliments for my new clothes, shoes and stuff. If anything, I’d rather hear compliments about who I am and how I am rather than what I possess. I was never a brand name chaser but was a sucker for buying stuff. All that mindless consumption needed to stop.
4. Life Transformations
Life on my own terms
15 plus years ago when this transformation began, I had a fulfilling job. I was inspired by what we did, which helped me to inspire others at work. The rewards of the job that I loved were great both in the fulfillment and financial department. Still, I was mindful of the fact that things can change at work and a job may no longer be fulfilling. The cause can come from my own motivation or external, at which point I wanted to have the freedom to seek something else. I did not want money to be the motivation factor to stay on a job then nor now. It was up to me to create that reality – a Life by Design.
Reaching financial freedom
Two years after achieving my financial independence (FI: status of having enough income from investments, passive businesses, real estate, etc. to pay for one’s reasonable living expenses for the rest of one’s life without having to rely on formal employment), I was mentally ready for a big change motivated both by internal and external factors and left my employment of 18 years. Would I have stayed at the job if we hadn’t achieved our FI? Maybe. Would I have been happy? I don’t think so.
Reset of your relationship with stuff and money
I was in my mid-forties when we reached our financial independence. We didn’t have any windfall, nor rich family to help us out. We didn’t live frugally like many FI gurus on the internet. I attribute our ‘early’ FI to our relationships with stuff and money. Recognizing that the stuff we buy needs to reflect and reinforce our values, naturally reduced our consumption. Less consumption meant that we had more money left over to invest and build our assets.
Money makes money
Money invested will make you more money. There is a good article here about Compound Interest. Money invested and left to grow will increase faster than you think. Do you have to live frugally? I would say that balance is key to a lot of our decisions. Frugal is okay as long as you enjoy it. However, if it is a compromise on your comfort and happiness, then of course it affects your quality of life. Now is just as important as your later. For us, just not making those unnecessary and unfulfilling purchases was good enough to reach our FI early enough.
Work on your terms
Now that you recognize that money’s job is to pay for your lifestyle, you determine the need – how much wealth will you need to have built to seek freedom short -term (emergency fund to pay in between jobs) and long-term (FI, you can leave employment altogether if you so desire).
Work where your values are aligned and where you feel fulfilled. Don’t sell your values, integrity and dignity at work, for money. Recognize and take full responsibility that you yourself are in control. Take building your wealth seriously while on employment. Work serves your life, not the other way around.
Your life is most important. Your values make you and your life.
Work serves your life in providing you fulfillment, and money.
Money serves your life and pays for your lifestyle needs.
