Your Money or Your Life: 9 Steps to Transforming Your Relationship with Money

 

For many of us, one of life's greatest challenges  is to escape from the financial pressures of life , so that we are not enslaved to our bills and debts. It can be very hard to be mindful of our true self when we are under such pressure.  I remember not too long ago feeling an enormous weight on my chest every moment.  Bills were juggled with occasional overdrafts that snowballed into  bigger problems. Desperate to find alternate solutions to banish this "ball and chain", I decided to seek ways to reduce my expenses.  I knew in my conscience that the worst remedy to my financial overwhelm was to add to my steady 70 plus-hour work week.

I don't really recall how I stumbled upon the book; it was a lifesaver - literally.  My stress was wearing on both my mental and physical health.  A divorce, recent custody of three teenage children, leaving a relatively high-paying position to take custody of those children - it seemed too much.  The very concrete steps detailed in the book totally transformed my understanding of money. Additionally, the book helped me to clarify my values and bring mindfulness to how I spent my life energy.

The author, Vicki Robin, lays out a 9-step solution to help you dig deep and look at how you spend your life energy. This book is really about the integration of all aspects of your life. You see, money is more than paper; it is a representation of your life hours, and your time spent.  How much of your life are you spending on that cell phone plan?  Is it worth it?  It is a very personal question only you can answer.  How much does that second income really help?  Did you subtract the cost of work clothes, transportation, additional take-out and convenience foods, childcare, etc...?  Vicki challenges you to break it down and determine what works for you and what doesn't.

V.Robins does not recommend a bare bones life with no luxuries.  "Just enough" is the concept.  Safe and comfortable shelter, nutritious food, adequate clothing....the basic needs, a little luxury, and some savings for safety.  The law of diminishing returns applies here.  After a while luxuries are not worth the extra life energy spent.  This book will help you examine how you’re exchanging your life energy and determine if your choices are bringing lasting fulfillment. 

Here is an overview of the 9 steps. I highly encourage you to purchase the book and use it.  It changed my life.  It led me toward the path of a lifestyle based upon minimalism.  Weed out the life-draining things that don't matter and have no added value to your personal happiness and satisfaction.  Then, leave only the most precious, meaningful things.

Step 1:  Make peace with the past. 

Sum your lifetime earnings then look at what you have to show for it. Use tax returns, social security statements, and any other financial records you have to calculate your lifetime earnings.  Next calculate your net worth.  In order to complete this first step you have to look back and see your past money mistakes. This can be a painful step.  Instead of lamenting over your past mistakes use those experiences to apply the learned wisdom, and to move forward.

Step 2:  Calculate your real hourly wage. 

Subtract commuting costs, clothing costs, meals eaten out during work hours, and any other work-related expenses.  Some things are hard to quantify.  Do you spend more money on "big" vacations because your work life is so stressful?  Try to factor in all expenses.


Step 3:  Monthly tabulation.  Where does it go? 

Tabulate all your expenses into categories, add them up, and convert them into hours of life energy.  Track exactly how you spend your life energy.  The author recommends doing this for months. I did it for one month and got the picture.  I go back and re-evaluate every few years to get back on track.

 Step 4:  Evaluate the expenses from Step 3 using your values and fulfillment as a guide.

Look at how much of your life energy you spend on each item from your monthly tabulation.  Is it worth it to you?  I recently calculated that I spent over six hours a month to pay for my cable television subscription. That may not seem too much, except that I only watch one to two hours a week of television - max - and I normally regret most of that as wasted time. Off with the tele!

Step 5:  Create a chart that compares your income vs. your expenses over time.

Don't skip this step.  It may seem trivial, but it has a great impact on your discipline and how well you will stick with the program.  Put the chart somewhere visible where you have to look at it daily.

Step 6:  Value your life energy by minimizing expenses.

Cut out spending that doesn't align with your values and personal mission.  Learn to take care of your possessions, learn to do and make things you've previously paid others to do, and learn to enjoy it.  I'm always surprised at the number of people that do not learn to cook.  What could be more enjoyable and sacred than creating a fabulous, nutritious feast for yourself and those you care for?  If cooking isn't for you, maybe you can learn to detail your own car.  Personally I'd rather spend an hour working next to my wife taking care of our own business, than having to work an extra two hours at my job so we could pay someone else to wash our vehicle or cook our dinner (i.e., restaurant, frozen meals).


Step 7: Value your life energy by maximizing your income.

Make the time you spend working count.  It should add value to your life in a number of ways.  Do something you feel good about and maximize your income while doing it.  Do it well, ask for a raise, and change places of employment if necessary. 

Step 8: Find your crossover point.

Use the chart from step 5 to calculate when your savings and investments can start paying you an appreciable return. 


Step 9:  Learning to really manage your finances and secure financial independence.

Step up to the plate and dig in.  Learn true money management and finance techniques.  Invest to establish a safe, secure income stream.  The author recommends cd's and savings bonds.  Personally I prefer dividend stocks from established companies that have a proven track record of increasing dividend payments over many years.


To me this book is about much more than finance.  It is about becoming aware of our compulsive spending habits.  It is about putting our time and money where our values lie.  It is about being mindful.

Below are some great links on living simply and being frugal.




Your Money or Your Life Official Blog

wisebread.com

frugaldad.com

We Only Do This Once

12 reasonsI'm a minimalist on Zenpresence.com


Zen Presence - minimalism, simplicity, self improvement, simple living, Zen in modern life

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