A reader asked me if I could break down my ideas into a handful of principles. After some careful thought, I came up with a list of fourteen basic “rules” that summarize my money and life philosophy. I’ll be presenting these as a weekly series.
The book Your Money or Your Life by Joe Dominguez and Vicki Robin (read my detailed notes on the book) had a profound impact on me when I was figuring out my personal finances. One major theme of the book was the idea that you need to sit down and figure out the small handful of key values that are central in your life. Once you have figured out what those are, the rest is secondary – and that means you should seriously trim back your spending in those areas.
Not surprisingly, a major chunk of the book is devoted to ways to cut your spending. Right at the start of the list – the single most important tactic they suggest for cutting your spending – is summed up in six easy words.
Stop trying to impress other people.
If you buy a car that’s flashy rather than focusing on one that gets the job done as efficiently as you can find, you’re spending money to impress other people. If you go clothes shopping by the store sack full, you’re spending money to impress other people. If you always have the latest gadget, you’re spending money to impress other people. If you always must be seen at the coolest new place, you’re spending money to impress other people.
Stop worrying about it.
I found it was really powerful for me to take people and split them into two groups: people whose opinions I cared about, and people whose opinions I didn’t care about one way or another.
It was easy to stop caring about impressing people whose opinions I didn’t care about. Who cares what they think? As long as I’m not doing something truly offensive or heinous – something that might potentially create a negative reputation for me – it doesn’t matter what they think.
The trickier part was worrying about impressing other people whose opinions I do care about. People I want to meet. Customers. Friends. Family. Shouldn’t I want to impress them?
Again, I go back to the basics. As long as I’m not offensive – meaning I’m clean, I’m presentable, and I behave myself – I don’t need to impress these people with expensive, shiny things. The relationship I’ve built with them – or I’m going to build with them – is based on me, not on the material items. They’ll either like me for me or they won’t – no amount of shiny will change that.
So, to put it simply, take care of the basics. Have good hygiene. Keep yourself clean. Keep your weight under control. Wear reasonable clothing. Work on your communication skills. If you have them covered, you don’t need to invest time and money into impressing other people. You will naturally connect with the people you will connect with, and you won’t connect with those you wouldn’t connect with anyway.
Coming to this realization is incredibly valuable. It drops your clothing budget. It drops your automobile budget. It drops your electronics budget. It drops your housing budget. You don’t need a McMansion, a shiny car, an iPhone, or a $50 haircut.
(Yes, you may actually still want one or two of these things, but the impetus comes from what your personal core values are, not what other people around you seem to value or what marketing messages you receive.)
For some people, it seems impossible. Their social cues come from advertising-laden media and from friends who also get their cues from advertising-laden media. They believe they need a slick cell phone and $100 casual clothes. Their self-worth revolves around that little burst they get from impressing others.
Here are six ways to break through that situation.
1. Take the lead. Be a trendsetter within your group. Back away from the expenses and activities that revolve mostly around impressing other people. Make suggestions for activities that don’t revolve around showing off.
2. Try new activities. You can do this either with your circle of friends or on your own, but try out new things that you might never have considered before. Think of things that seemed fun to you but you never got involved with because others around you decried them – and you were trying hard to impress them by agreeing.
3. Guide the conversation. If the conversation turns to bland compliments of each other and insults of people outside your group, steer the conversation away from it. Focus on being positive towards everyone, particularly in non-material areas. Pick areas you’re passionate about (don’t be a one trick pony – figure out several) and guide the conversation there instead.
4. Use your compliments wisely. Offer compliments on jobs well done, but don’t bother with big compliments on new gadgets or new clothing or a shiny new car. It’ll become clear that what you value are people who take charge of their life, not people who fritter away their money trying to impress others.
5. Share personal growth oriented thoughts. Instead of talking about popular culture and “stuff” all the time, instead mix in some thoughts on personal growth. Talk about ways you’re trimming your spending in positive ways. Talk about your big aspirations and dreams. Encourage others to share theirs as well. It also helps to read good materials in these areas so that you have more food for your own thought and more ideas to share.
6. Explore new relationships. If your circle of friends is still focused too heavily on impressing others and on material gains, spend some time exploring new relationships. Call up people you’ve thought of as interesting but simply wouldn’t fit in your old group and see what they’re up to. Connect with people at the new activities you’re trying. (I’ll touch on this a little bit more with a later rule.)
In short, don’t play socially by the tired old rules that revolve around needing to impress people. Instead, spend your time on things that bring real value to you – and give real value to others.