My FaceBook and ROWE friend, Charles Harrison Baker, once asked a question I sometimes hear repeated by others, in some variation:
“How can I turn my love of reading, writing, exercise, technology, and computers into a six-figure, or multiple six-figure, income?”
I suggested he was asking the wrong question. I asked what he believed a six-figure income would bring him. He thought about it and summed up his response by noting a large income would allow him to do more things he is interested in.
I replied, “Then maybe the question is, ‘How can I do more things I am interested in?’”
“There is some truth to that,” Charles granted, “But my family must eat. Also, I’ve only one year before my oldest starts college. I’m looking for ways to turn what I enjoy into streams of revenue rather than draining expenses.”
Let’s have a conversation about Money (and by “conversation”, I mean I am going to rant and I hope you will read my rant and possibly leave a comment…).
It is easy to believe money will solve problems instead of create them. Who has not, on occasion, said to himself, “If only I had more money, then I could… (insert daydream here)”?
Money is a tool, like a hammer. If you use a hammer properly, you can do fantastic things with it, like build a house. If, however, you use a hammer the wrong way—to drive marshmallows instead of nails, for instance—then the results will be predictably bad. The catch is, Money is a very complex tool that many of us struggle to understand. Unfortunately, our ignorance is, as in many things, our folly.
How Much is Enough?
Consider the NBA (National Basketball Association) or any other major sports organization. There are athletes who make 6 million dollars per year but leave their winning team to play for a team offering 7 million dollars per year. Why would an athlete do that, dismissing his loyalty to his home team and his established fans? The answer is because the other team offered 7 million—and that is 1 more than 6. And more means better. Even when you are making 6 million dollars per year—an amount that seems absurdly sufficient for most of us—it does not matter. It is not enough money; the athlete believes since 6 million has not fulfilled him, another million will make a difference, will somehow make him happier or more content.
More money is never a solution, but our social training commands us to believe it is.
Employees live in the same broken paradigm. They believe more money will make their jobs more tolerable. They are right; it will. A salary increase will make an employee feel better about his job for about (and let’s be generous here) six months. Then he will steadily realize he has the same job he did before and the job is as misery-inducing as it ever was.
The reward of money tapers off, so like crack-addicts, we scrabble for the next high; we need more and we need it now. A bigger influx, we think, will do the trick; a larger raise, or a different company offering more cash (but the same miserable job in the same miserable career).
Money can be a fine reward, but it can only be a temporary one. Companies that realize this, win. Companies that do not, fail. They get stuck in the trap of believing the best way to fix a problem is to throw more money at it. Because employees share the same ignorance about money, the system feeds itself, and we have… well, what we have today.
More! More! Less…?
If more money is not the answer, then what is?
I think we should start by asking, “What do I believe money brings me? For what do I secretly think more money is the solution?”
Sometimes I find myself pining for things I believe wealthy people have (that I do not). I really want to own a mansion instead of my 848 square foot home; I also want a couple expensive, fast cars instead of my 2006 pick-up truck, and a winter home in Savannah, Georgia. I want my parents and in-laws to have second homes, too, and to travel internationally as much as they want. That is how my family taught me to know I am doing good in life—by how much excess I have and how much I can pay for other people.
If all those things were true, though—if I had the fast cars, the big house, and the winter getaway—the truth is I would be no happier. In fact, I know I would be more miserable. Does that seem counter-intuitive?
Consider this. When I was 18, I lived with my parents and thought a quarter-pounder combo from McDonalds was about as good a meal as it gets. I owned a beat-up, rusty, very used 1987 Chevy Astro Mini-van. I know… total chick-magnet, right? I would have done anything—anything—to have had the money to move into my own place and own a car I would not have been embarrassed to show up for a date with, and been able to afford to take a date to a restaurant that actually had a wait staff.
20 years later, at 38, I was a homeowner, my car was less than five years old, I ate only vegan, organic food, dined at nice restaurants, and guess what? I thought my house was too tiny, I didn’t like my neighborhood, I wished I had a Tesla Roadster instead of a Nissan Titan, and every winter I dreamt of visiting my imaginary house in Savannah. Incidentally, if I had the fancy cars and bigger house, no doubt I would have wanted another car, a yacht, and a housekeeper.
It is easy to imagine there is a point at which I would be content, but all I need to do is look around. Even the wealthiest people I know, who seem, to me, to live in a fantasy land… they want MORE. And more. And more. It is never enough. You might be thinking it would be enough for you, but the truth is you have enough already… and it is not enough. If you are an average middle-class American, you live better than nearly 90% of the world. You have clean water—you even have the wealth to buy bottled water in addition to your clean tap water—you literally have a roof over your head when you sleep, your homestead is likely larger than a 10 x 10 foot room, you have access to medical care, you have enough food that you can casually throw some away, and you have a means of transportation, even if it is a bus or a bicycle.
Tragically, though, we have been conditioned nearly all our lives to keep consuming and disposing. We want things we never even dreamed would exist only 10 years ago. Remember cassette tapes? When you had a cassette player, you wanted a CD Player even though you didn’t know what a CD Player really was, but you knew you had to have one because sound does not get better than with a CD Player. Until MP3 players came out. Then you had to have one of those. Then you needed a phone with an MP3 player built in. Now you need a phone that costs as much as a desktop computer.
The reason lottery winners almost never have happy endings to their stories is because the system is a con. It is designed to train us to be consumers and disposers, and to feed that cycle continuously.
Again, it is never enough… until we say it is.
Beating the System
Here is an idea. Instead of continually scaling up, put your efforts into trying to scale down. Accept that you are wealthy (because you are extraordinarily wealthy compared to the tomato pickers working for Burger King, Taco Bell, and most grocery chains). Rather than trying to accumulate more junk goods, work toward minimizing your consumerism.
Here is my 3-step plan to live happily, wealthily, and wisely:
1. Free yourself from debt.
The bad news is it will probably take four times as long to get out of debt as it did to fall into it (because we are paying for everything four times over, or more), but there are ways to accumulate victories and speed up the process. For example, pay the minimum due on all credit cards except one (the one with the highest interest rate or lowest balance—your pick). On that one card, pay as much as you possibly can each month until it is paid off. Then pretend you are still paying on it and add that amount to the next card with the highest interest or lowest balance, while paying the minimum on the rest, and so on…
2. Stop accumulating.
You do not need more things but no doubt you want them anyway (I know I do). We can make a deal with ourselves, though. For every new item we buy (aside from groceries), something must go. In other words, if I buy a new pair of jeans, I must get rid of a pair of jeans—either to charity or on Ebay, or just in the trash, but something equivalent must go. If you want to be really aggressive, remove two things for every new purchase or gift. For your groceries, shop at smaller, local stores. You will find the prices quite comparable to the big box stores (like Kroger, Walmart, Target, Best Buy, etc.), but they will have a smaller selection, which will help you scale down. When I shop at a big box store like Target, I find even if I am just there to pick up a roll of toilet paper, I walk out having spent a hundred dollars. When I shop at Trader Joe’s, however, I still buy a week’s worth of groceries but I save about $30 on each trip, because Trader Joe’s does not have everything I want; they just have everything I need. Same for my local hardware store instead of Home Depot or Lowe’s, and same for local or used clothing stores instead of the big chains.
3. Buy experiences instead of products.
This has been the hardest lesson for me because I love gadgets. Instead of spending $4,000 on a new television, though, why not buy the cheapest one that meets your needs (say, for $500)? Save up or use the extra $3,500 to go on a vacation. The feeling you get from the latest episode of Desperate Housewives lasts until the next episode. The feelings and memories from a vacation in the tropics, however, will last your whole life. Which is the better return on investment? This does not apply only to big purchases. Angela and I learned the movie “Inception” was a $42 waste of time, even in 3D, and even at the Imax theater. Not that it was a bad movie, but it was $42 and 2 and a half hours we will never get back. For the same price, we could have spent the entire day at the Science Center, a museum, an amusement park, or just having a wonderful picnic under the shade. What a waste that we didn’t.
There you have it. I focused on money here, but the same principle applies almost anywhere in your life. When you find yourself answering problems with, “If only I had more… (money, time, authority, etc.)”, stop yourself and ask, “How can I apply LESS to solve this problem?” More is rarely the answer.
So Charles, if you are reading it, this one was for you. I hope you reconsider that your love of reading, writing, exercise, technology, and computers is not about creating an income stream from doing those things. If money is the goal, there are lots of ways to make money, but you do the things you love because you have a passion for the experiences they bring.
Concentrate on increasing the experiences, and the money will come. Or not. But what does it matter if you are making a better life, instead of trying to make a better living?