Money is how we demonstrate our value things in our life. It’s emotional, and personal and causes problems when two people or more share the same pool of money. AKA marriage.

Keep writing and I will keep reading.

So what could be most fulfilling to us would be to minimize operational expenditure (living costs like rent, phone bills etc). Capital expenditure in this metaphor would be things we spend to invest in ourselves – education, travel, good food. Capital expenditure creates more growth in the long run because you are spending on productive resources – not really a bad thing to become a more well rounded person.

Obviously like any company, you have to basically decide what your most bang-for-the-buck category of capital expenditure is and go for it. Trent has mentioned a love for cooking – that’s definitely investment in himself in my opinion!

“Stuff” doesn’t actually feature in the metaphor at all! So unless all the ipods and fancy household gadgets are really going towards enriching you as a person, they’re basically operations – the first to get cut by any good CEO.

Net worth / hours worked is really a way of measuring your savings per hour of work. It only would represent the number of hours of work needed to buy an item if savings was your only current income source.
-Rick

I think Trent’s post is aimed at the relative majority who never learned/don’t understand/cannot follow good money management principles. Some people *do* see the work/money connection properly, and more power to them as they use their credit cards or whatever!

As far as loving what you do for a living . . . well, it’s wonderful in principle but not practically feasible for many people, at least in the moment. There’s nothing preventing us from pursuing our dreams and trying to make them financially self-sustaining, but: (1) there are no guarantees, and everyone has different levels of how much risk they are willing to accept; (2) some people are responsible for others (kids, aging parents, etc.) and must do whatever is necessary to bring in enough money to live on; (3) it’s hard for many people to even get clear on exactly what they *would* prefer to do with their lives; and (4) even for those who steadily pursue their chosen career/life goals, it can be a l-o-n-g process, and in the meantime there are bills that need to be paid.

I, for one, would love it if someone would fully subsidize my existence for a year or two so I could put full-time effort into carving out a new career path which is closer to what I really want to be doing. Yeah, like that’s going to happen. So as I explore my options, I will be keeping my day job. In practical terms, I have no choice, all the positive thinking in the world notwithstanding. But I will continue to take baby steps toward the new career goals I’m now thinking about.

On spending vs. saving (yeah, I’m being really brief here, aren’t I? LOL!) . . . I think it’s about finding a balance. Dig yourself out of the debt hole you’re in, if you are in one, save enough to cover emergencies, and save/invest responsibly for the future. But don’t live like an ascetic. Live as simply as you can without being uncomfortable, and live in *awareness* so you can make that determination. But indulge enough in occasional luxuries so that life feels worth living.

Thanks, Trent, and all the commenters–great discussion!

You need to spend at least enough under what you earn to build up an emergency fund. If you don’t then each emergency (tire damage, car accident, unexpected illness, etc.) puts you in the hole. Have a few of these kinds of things pop up in a row and it can get to the point that it’s hard to climb back out.

It’s actually not so bad if you are spending mostly on non-recurring expenses since you can just spend less and pay off the sudden debt you incurred. But it would still be nicer if you had $6-10k saved up and were able to avoid being in debt in the first place.

My dad, on the other hand, was frugal to the point of cheapness. His parents were better off than my mom’s family, but never had much. SHockingly, though, they (like my dad) saved like crazy, and had actual cash in the bank. However, they were paranoid about touching it. My dad was cut from that cloth too, and saved to the point that we kids (there are 5 of us, through remarriage and another adoption) were grounded if we touched the leftovers in the fridge. They counted the lettuce leaves and the eggs–it’s kind of pathological. My dad and stepmom have a great retirement, and a huge house (that nobody ever stays the night, so why 5 bedrooms?), and they travel internationally and eat at very nice restaurants. But, when my brother was being beaten up at school, and was begging to be transferred to a private school, they refused to shell out the money. As a result, he dropped out of school at the earliest possible date (with my dad’s permission–age 16), and went on to a series of lousy minimum wage jobs (my dad did collect rent from him until he moved out), and his future was pretty much written at that point.

I guess the point is that we aren’t the only generation that thinks of money and savings in unhealthy ways.

Trent: For me the disconnect has always been between now and later. The farther away later is, the less real it seems, and the less value I put on it. It takes something very signifcant to make me realize the future is just as real as the present.

I think when it comes to change, the emotional aspect helps us understand why, but we still can’t forget the how either. It is worth repeating “spend less than you earn” because it tells us that change is possible, and not even very complicated at that.