What is your money for?
I am currently doing a short mini series of chats for Global TV Calgary designed to help people ‘cut back on their spending.’ It is of course presented in a way that is to communicate a certain domineering sense of denial: Smarten Up; get better with your money, etc. That sort of theme is very common and is designed to address the idea of New Year’s Resolutions. Coincidentally and concurrently, I have had quite a few recent soul-plumbing conversations with clients about what sort of money they need to live on. These have been triggered because of lay-offs, retirement, forced early retirement or even worries about ‘enforced’ late retirement given their former heavy dependence on resource-focused investments.
Both of these activities are driven from the core scary idea of scarcity. Of not having enough. What these barely-connected series of ‘un-fortune’ events have stirred in me is that age-old four part quadrilemma of what is the best combination of enjoying rational prudence vs suffering crushing denial vs focusing on true satisfaction vs the rush of the immediately acquisitive. One of secrets of happiness comes from finding that proper balance between these four for each of us as individuals.
A Penny Saved is a Penny Earned
In the TV series I address this in the simplest way, namely the concept that by giving up a few relatively unsatisfying fast food meals or unneeded nights out, you can use that money you save to acquire something more satisfying. But actual ‘hierarchy of satisfaction’ goes much deeper than that:
We work, we trade our limited time on earth for cash to meet our needs and desires. But once we have food, medicine and shelter, the only other true ‘needs’ are not trips or cars or flat screen TVs. These by themselves, without representing something meaningful to you, are just objects. The true needs are to feel Purpose and Meaning. It’s idealistic but not naive to believe that budgeting and by extension all forms of financial planning, should be about meeting those important Needs. In the end, satisfaction with life comes from meeting those needs.
Society imposes a conflicting, strangely fluid line for us all to walk, though. We celebrate, envy, and strive for financial success, material wealth; we all have ‘capital appreciation’ . We reach for wealth, however we define it, but the danger is that once we reach it, it moves quickly from stirring a sense of accomplishment and luxury and joy to a more fretful, shallow, jealous gnawing sense of need, or even a cynicism, tainted with a hint of a sense of guilt.
The good news though is that feeling guilt or feeling prudent or feeling denied or …whatever is wholly something we choose to feel. Consider how buying the same 15yr old used car would feel to a 16yr getting his first car vs a newly single mother vs a laid off oil executive. Consider what feeling or meaning each of these individuals would imbue into that indentical purchase.
In short, budgeting should not be seen as a denial of life pleasures. It is really, more about a strategy to make sure one of the key needs of your life, to have purpose and meaning, is not brushed aside by more obvious but short lived gratification.