I've started reading a book about personal finance (yayyy!) called Your Money or Your Life. It's actually pretty good, in that it comes from a position of criticising the prevailing ideology of 'more is better'. But i can already see I'll have serious problems sticking to the plan. Step 1, e.g. involves working out how much you've earned over your entire lifetime. Then you're supposed to work out exactly how much you spend a week/month, etc. Then you're supposed to start making a note of EVERY SINGLE PENNY you spend.
The promise is - if you stick to this plan, you'll be financially independent and could retire decades earlier than you would otherwise.
I mean it's obviously sensible and probably true. I spend money without thinking about it, on things I don't need, that I only want fleetingly. Digital payment has made that as easy as breathing.
For me... you would be gaining something - financial independence and so on - but also losing something. I mean is keeping track of everything you spend and thinking about money constantly a price worth paying to be free from, er, worrying about money?
I guess the idea is that when you don't know how much you're spending and have you're going to be failing to save up, failing to get out of debt, so (unless you're rich) you're going to be worrying more about it in the long run than if you kept an eye on what you're spending so you can steadily accumulate a nest egg.
I dunno, I've never had this mindset but now I'm 35 and I'm starting to actually think about the distant days of retirement.
I've realised that I've got about 150-200 records in my parents attic that I could probably sell on discogs and make maybe a grand or two off, instantly? I never play these records. They have sentimental value but they're literally gathering dust atm.
You start questioning your attachment to objects. What do they represent to you?
Obviously if you're playing the records or reading the books they have real value.
Yeah I understand the point I suppose. But a lot of things like that you have to decide what's important to you.
For example I remember my friend had this real kinda diggers compilation and the (pretty wanky) sleevenotes were bragging about how all the tunes on there cost hundreds of pounds to buy on the open market - but he'd personally got them all for pennies from car boot sales and such. In fact he was almost castigating the person buying the comp for not doing that themself. But the thing is, for most people, they don't want to spend every morning of every weekend searching through piles of junk, they pay not to have to do that and they consider it a good deal.
I suppose all I'm saying is, cheaper isn't always better, if you have to do a lot of work to save money then you have to think about what effective rate you got paid for that work. If it was three pounds an hour then maybe the saving wasn't so great.
This is another step in that book's program - you work out what your actual wage is by calculating how much of that wage you spend on stuff attached to your job e.g. commuting. On the most basic level, you might be considering two jobs - one pays higher, but is further to travel. It might be that you look into it and you're not actually going to be earning that much more from the job that's further away, when you take travel into account (+ money you spend on food because your commute takes away your time to make food).
I'm probably not explaining this book very well - but it does seem at least to come from a reasonable position of valuing money as much as you need to, rather than placing it above all other considerations.
what i do to keep my finances in control and that works perfectly is, i determine how much money i want to have left at the end of the month. then at the beginning of the month i withdraw everything else from the bank machine and with that money i live the entire month. it's so simple but it works. another advantage is that you don't make any pin transactions so they can't track you. everything is payed with cash.
one thing i have in common with Rich is I love spending money. ritual immolation of huge piles of cash. the only thing that seperates us is our means. tragically im not rich like he is. but i do love to wantonly spunk it all over the wall.
Ha yes... there is nothing better. You're right about Dutch though, I used to work for a Dutch company and they spent a lot of time telling us about Dutch culture (basically being tight with money and always making sure you get the better of any deal) and trying to inculcate it into us. They made us read a book called Dealing With The Dutch.