Your Money or Your Life: Cushions Make For Softer Landings

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YMOYLThis is the twenty-eighth part of The Simple Dollar Book Club reading of Your Money or Your Life. Want to know more?

Finally – the last section of the book itself. Although this “book club” isn’t quite finished, this is the last piece of actual text from the book, as today’s reading finishes up the ninth and final chapter, leaving only an epilogue (which just recites the content of the book), resources, and notes.

Your Money or Your Life finishes up with several small pieces, the first one being a brief discussion strongly in favor of a cushion (one of the three pillars from yesterday). A cushion, if you’ll recall, is an emergency fund – an amount of very liquid cash that you have on hand in the event of a major crisis.

Cache, on the other hand, is much more interesting. When you reach the crossover point and quit your “real” job, Your Money or Your Life argues that your personal expenses will drop to at least some degree, leaving you with a continuing surplus even after detaching from your job. This is cache, which is effectively money you can channel into your later activities. For example, let’s say you quit your job so you can start making wooden rocking horses in your wood shop, selling some to rich families and donating others to all kinds of charities. The business would likely pay for itself and a little more, but the cache would allow you to keep making horses even during December, when you might give away every rocking horse you make.

Alternately, you might just spend the money entirely on charitable giving, or use some of it to pay for equipment for whatever you do. The point is that cache will exist in your post-financial independence life and it’s money you can use to really make a difference in the lives of others. After all, you are truly financially independent, right?

Your Money or Your Life closes with a brief discussion about a potential future where everyone jumped on this train, and looks at the societal changes it would bring. Interestingly, it looks like a capitalist boom – unemployment drops, productivity rises, urban sprawl and urban decay lessen, volunteerism and social activism grow, and consumerism decreases. Sounds like a pretty good world to me; I think that if everyone jumped on board the full philosophy of Your Money or Your Life, it might be bad, but an increase in people doing things this way might be good.

Tomorrow, we’ll look at the “Resources” appendix to see if there’s anything else of interest out there related to this book. This section appears on pages 337 through 343 in my paperback version of the book.

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3 thoughts on “Your Money or Your Life: Cushions Make For Softer Landings

  1. I see we are finally wrapping up. I found that the book kind of trailed off for me over the last couple chapters. I don’t know, maybe it’s just me struggling to see the long term view when I can live off my ‘cache’. I like the concept, it’s just going to be hard to get there.

  2. It depends where you are, and who depends on you.

    Single w/ no dependents is a very different situation from single/married with dependents.

  3. Heh… the first time I read this book, I was disappointed and excited at the end. Disappointed because there was no “trick” at the end to get me up to the FI point in just a couple years.

    But I was excited because, I hadn’t put it all this together myself. Like the book says at the start, it’s a great “new” map.

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