Updated on 06.01.07

Review: The Soul of Money

Trent Hamm

Soul O MoneyWhen I showed my sister-in-law The Simple Dollar, her first comment was, “You talk a lot on here about ways to make and save money. Do you really talk about how to spend it in a spiritually fulfilling fashion?” It was a question that actually made me think quite a bit. I do talk about ways to spend money on here, but it’s mostly towards things that enable more self-reliance and thus over the long run financial savings.

While ruminating on this issue, I came across The Soul of Money by Lynne Twist at the library and I realized this book covered the exact thing that my sister-in-law was talking about. The pitch line on the back cover spelled it out: “In a consumer society that glorifies the pitch, the sale, and the insatiable appetite for more as a measure of self-worth, The Soul of Money asks us to step back, to examine our relationship with money, to assess our connection with core human values, and to change this relationship and, in so doing, to transform our lives.”

Thus, this book focuses in on ensuring that the ways we use our money are in line with the core values we hold in our lives. Before I even started reading the book (I let it sit on my dresser for a few weeks before cracking the cover), I spent some time thinking about my core values, and I realized that the small-scale value that is strongest to me is my family and the large-scale value to me is energy and nutritional independence. What could this book teach me about my own finances and how they relate to those two values?

Looking Deep Into The Soul of Money

Chapter 1 – Money and Me, Money and Us
The book opens with what could best be described as an introductory chapter, outlining how many people separate their soulful life (the one centered around their values) and their financial life (the one centered around their money). Within each world, they behave differently: the soulful life is usually full of following the things that really matter, being fair to others, and so on, while the financial life is full of greediness and petty behavior. But why does this dichotomy have to exist? Why can’t the soulful side be on the same page as the financial side?

The example of this that really struck home for me was when the author described their early marriage and how they handled children. Their soulful life told them that the children were the center of everything, but they spent almost all their time focused on their financial lives: buying expensive art, buying wines, going on fabulous skiing vacations, optimizing their careers, and so on, but in doing this they found themselves missing out on their child’s first steps and first words and such. They provided financially, but they didn’t provide emotionally, and thus their financial lives won out, for better or worse.

Chapter 2 – Into India: Heart of Hunger, Soul of Money
Money alone does not guarantee a fulfilling life, and a lack of money doesn’t guarantee an empty life. So why do people associate money with fulfillment? The real truth is that there is a disconnect between the two, and that gap creates most of the pain that people feel when it comes to a sense of not having enough money – or enough of any material good – and also from the sense of “selling out.”

The truth is that it doesn’t matter whether you’re rich or poor, you still have the capacity to make decisions that don’t truly reflect your ideals, and it is those repeated wrong decisions that leave people feeling empty and hollow. I liken this dichotomy to a recent choice I made: I was basically confronted with a direct choice between making money/focusing on my professional goals or following my values, and I followed my values. What happened? A truth was revealed to me, and it enabled me to actually accomplish both by letting my values lead.

Chapter 3 – Scarcity: The Great Lie
Most people have an innate sense that there is simply not enough: that explains not only why they are always striving to get a bigger piece of the pie, but why some people suffer in poverty and hunger. However, basic analysis of the situation shows that there is more than enough food to feed the world – and more than enough stuff in your life to bring happiness.

The myth of scarcity breaks down into three parts. First, the idea that there simply isn’t enough is a myth that we use to delude ourselves into believing that there is a “pie” of a certain size that can’t grow any larger and that if we don’t grab a bigger slice of it, someone else will. Second, the idea that more is better causes us to always grab for that bigger piece of pie, even to the exclusion of others. Third, the concept that this is just the way things are gives us a very weak excuse to act greedy. The truth? All of these are complete myths – there is abundant resources for all and the only reason to grab more and more and more is greed; we use these myths to justify greed.

Chapter 4 – Sufficiency: The Surprising Truth
The book tries here to make a clear distinction between the idea of “enough” and the idea of “abundance.” Most people strive for abundance, but the truth is that abundance means that you always have more than you actually need, and acting on this basis means that in fact you are denying things to others in order to create an overflow for yourself.

A much better target is “enough;” find the things that make you fulfilled and then use the overflow from that to make the world a better place. For me, this means that I should find the point where my work effort produces what my family needs, then spend the rest of the time chasing my values: raising my children well and working on alternative energy causes. Interestingly, this concept works hand in hand with the concepts in Your Money or Your Life (which I highly recommend).

Chapter 5 – Money Is Like Water
I found this chapter quite interesting. Many people (myself included) keep track of their net worth and strive to increase it each month or each quarter, a reasonable goal if you want to create a state of financial self-reliance. This chapter argues that once your net worth reaches a point of comfort for yourself, you should strive for zero growth in your net worth.

This seemed pretty strange to me at first, but as I read on, it made more sense. The author doesn’t mean that you should begin to spend like mad, but that you should take that growth in your net worth and apply it towards causes and values that are important to you. Let’s say, for example, that my child is considering a life of volunteer work for a cause that I also believe in; I could take that abundance in my net worth to buy my child a home to live in and pay the taxes on it while my child focuses on working for an organization. Or, I could use that extra money to start an “X-Prize”-like organization awarded to a group that designs a non-emission car that runs on something that could be produced domestically (a fully developed hydrogen car, for example). Once I reach the point of having “enough,” these doors open to me and become fulfilling things to do with my money.

Chapter 6 – What You Appreciate Appreciates
Just like an investment appreciates over time because of the dollars invested in it, anything of value appreciates over time in relation to the amount of attention you pay to it. Thus, take a look at what you spend your time focusing on in a given week. These are the things in your life that you are truly trying to grow; the other things are being left to wilt. Keep a log, if you want, of the time that you spend focused on various areas of your life: your career, your family, your interests, and so on.

The easy answer here is that there isn’t enough time in a day to give proper attention to the things that you want to give attention to. What that actually means is that you’re not allocating your time in a way that matches your values, and for many of us, that means you’re spending too much time focusing on your career and money-making motives and not enough time on the other things that are important to you.

Chapter 7 – Collaboration Creates Prosperity
The main thesis of this chapter seems to get lost in the shuffle of anecdotes. The general idea of working together and sharing skills seems to come through, but how does this apply to the thesis of the book?

It didn’t become clear until the end of the chapter, and it can best be summarized with the old adage give a man a fish and he’ll eat for a day; teach a man to fish and he’ll eat forever. In other words, the best gift we can usually give is sharing our skill and our time and not our money, particularly when we can use that skill to teach others how to walk for themselves or make it possible for them to do so.

Chapter 8 – Change the Dream
The “dream” referred to here is the social dream, using Martin Luther King Jr.’s “I have a dream” speech as an example. What sort of social change do you dream about? Instead of taking the excess in your life and spending it on a $200 pair of pants, why not apply that money towards creating that social change?

Your dreams can only result in change if you realize that they’re more than just dreams – they’re goals that you can actively work towards with your time, your money, and your passion. Dr. King didn’t make it to Washington to give his speech without time, money, and passion, but because he provided all three, he changed the world. Perhaps you don’t have King’s eloquence, but all it takes to change the dream is already in your hands.

Chapter 9 – Taking a Stand
One of the biggest challenges with making a commitment to change the dream is that it requires, at least to a degree, stepping away from the normal flow of Western society. Most of us spend our time worrying about accumulating wealth and buying stuff that we don’t really need and talking about things that are of no real importance. The first and most difficult step in really choosing to do something different is taking a stand against these things and choosing a different way.

This means that instead of following along with the flow of everyone else, the first step to chasing your real dreams of changing the world are to stop following their flow. Figure out what’s enough for you and just stop chasing the brass ring above all else.

Chapter 10 – The Power of Conversation
The next step to carrying forward a dream is really understanding it, and the way to do that is through the power of conversation. In an interesting way, I feel like the internet has really caused this to take off, as it has enabled people to become involved in movements and causes and conversations that were inaccessible to them even a decade ago.

If you want to change the world, find out how it works. Ask questions. Dig in and find that place in the dream where your skills can really make a big difference. Ask more questions. Do things. Be involved in the process. Let’s say you’re a web programmer and you believe in alternative energy resources. Look for a nonprofit group that espouses the same ideas that you believe in and volunteer your skills with them – help them design websites and web applications that can collect donations and reach out to more people who may be able to help.

Chapter 11 – Creating a Legacy of Enough
If one piece of the book really took ahold of me and grabbed me, it was this one. When you take a stand, change direction, and clearly commit to a cause greater than yourself, you set a great example for those around you, especially for your children. Instead of giving them an example of always battling just for more money and more stuff you don’t really need, you give them an example of battling for a cause that can affect the lives of countless people and authentically bring about change.

You can do this in a multitude of ways. Get your family and your community involved in projects. Take your child along with you as you volunteer. Involve your neighbors and friends in what you’re doing if they’re interested. Let them know by what you do that there are other options than merely following rampant consumerism, that they can, through their financial and personal choices, bring about real change.

Chapter 12 – The Turning Tide
The final chapter is merely a brief coda that reinforces the general points of the book, that once you figure out what is enough for you, you can take the abundance and really work to bring about the things that are important to you.

Buy or Don’t Buy?

The very first paragraph of the book pretty much sums up the content:

This book is entitled The Soul of Money, but it is really about our own soul and how and why we often eclipse it, dismiss it, or compromise it in our relationship with money: the way we get money, use money, give money, and/or sometimes just try to avoid thinking about money. This book is about finding a new freedom, truth, and joy in our relationship with money, this strange, troubled, and wonderful part of our lives. And it is about awakening and using the unexamined portal of our relationship with money to deliver a widespread transformation in all aspects of our life. Unltimately, this book is a pathway to personal and financial freedom.

If that sounds like left-wing rubbish to you (and it might), you’ll probably not get much out of this book or even enjoy it at all, but if that paragraph sounds exciting and empowering, then I think this book will be a home run. For me, I found parts of it to feel much like a liberal preaching to me about how to live my life, but other parts of it were quite interesting and thought provoking. Overall, it was quite worth reading; in many places, it made me seriously reflect on the relationship between my money and my values.

The Soul of Money is the thirtieth of fifty-two books in The Simple Dollar’s series 52 Personal Finance Books in 52 Weeks.

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  1. plonkee says:

    I am left wing – at least compared to Yanks. It sounds great to me.

    Who doesn’t think they should really put their values first?

  2. Amy Haden says:

    I used to think that I lived my liberal/left-wing values pretty well, until recently — when I started thinking about investments that my 401K retirement money might be in, and until I realized what another division of the company I work for was doing.

    Ironic that you reviewed this book today as the company I work for just announced it was divesting itself of the part of the business that had caused quite an ethical uproar. I guess I can keep working there!

    But I’m still torn between investing my 401K money in “socially responsible” funds (which so far have not had strong earnings), and other funds with great earnings (thus far) but which may or may not be invested in companies that I’d really want to be doing business with.

    I’ll definitely be looking for this book at my library!

  3. Thanks for the review Trent. I hope the paradigms outlined apply to many more things and not just money. Its always good to get viewpoints as in this book.

  4. Brad says:

    More of the “feel good” claptrap. :)

    How much is “enough”? Does that change? Is it forever constant?

    The main problem seems to be with the Dawkins’ book Trent gave as a gift last month – it has no real basis for morality, ultimately basing things on what “feels good” for the moment. Not a good way to either build an ultimately fulfilling like or even to be very frugal. Such unattached moorings float like untied boats in a harbor – nothing is ultimately stable and satisfying.


  5. Sarah says:

    I think the question of “what is enough” is actually profound. A person may choose to answer it shallowly (“whatever makes me feel good at a given moment!”) but there are much more complex ways to approach the answer. It sounds, in fact, like this book focuses rather hard on what ethical commitments you have to the world and how you realize them while struggling with managing your material needs and desires. Is there any higher challenge for us?

    Trent, while I suspect we are politically worlds apart, I appreciate that you try to place your concern for personal finance in the larger context of your values. Sometimes reading around the PF blogs frightens me: the authors can give the appearance (usually unintentionally, as a result of the subject matter) of caring for little besides their net worth. But money is a tool, not a goal, and I don’t think you can make your financial choices wisely without carefully considering your values.

  6. Jim Lippard says:

    Amy: Vice portfolios (and there really is a “Vice Fund,” VICEX) tend to perform much better than virtuous/socially responsible ones. You could invest in vice stocks and divert the dividends to positive causes… and use your proxies to support shareholder proposals for reform.

  7. Trent, you are a veracious reader. Keep sending these book reviews!

  8. Ted Valentine says:

    My question is similar to Brad’s. What is the basis of this author’s call to manage money on so-called values? If it the basis of the value system is whatever the individual decides, then what’s wrong with the “Whoever Dies With The Most Toys Wins” value system?

    Does the author take a position or is it all huggy-feely-do-good-so-you-feel-good-and-impress-others?

  9. kman says:

    I know this is your summary of the book but in chapter 3 I see this

    “there is abundant resources for all ”

    Then chapter 4

    “Most people strive for abundance, but the truth is that abundance means that you always have more than you actually need, and acting on this basis means that in fact you are denying things to others in order to create an overflow for yourself.”

    The phrase “you are denying things to others” really implies that there IS scarcity doesn’t it? If life is a zero-sum game then there isn’t an abundance-meaning there is more than people need in life. If life isn’t a zero-sum game then there IS emore than enough for everyone and it’s OK to have an abundance because my gain isn’t someone else’s loss.

  10. Trent Hamm Trent says:

    The idea is that there is more than enough for all unless some people grab excessive pieces of the pie – I think that’s fairly clear from the review. If you use that idea to say “Well, then, I should grab grab grab,” then you’re missing the point of the book.

  11. !wanda says:

    “The main problem seems to be with the Dawkins’ book Trent gave as a gift last month – it has no real basis for morality, ultimately basing things on what “feels good” for the moment.”

    I was wondering when someone was going to comment on Trent’s gift. I haven’t read Dawkin’s book. But if the “it” in the comment is atheism, the atheists I know have strong bases for morality based on, variously, responsibility to other people, responsibility to society as a whole, and responsibility to the Earth. Anyone can see that society and humanity can only function if its members, in general, behave in a ethical and respectful way. And, there you go, no God involved.

    Anyway, Dawkins himself doesn’t seem to live in a “feel good in the moment” way.

    As for the book reviewed here, the emphasis clearly seems to be on non-materialist values. If someone wants to read in justification for their own materialist values, nothing is going to stop them. You could probably give them Gandhi’s writings, and they would still find justification for their own values. A book, especially a book like this, is only useful if you are willing to read it in the spirit in which it was written.

  12. Brad says:

    Who decides what is “excessive”? It sounds like such an attitude leans toward communism/socialism where someone “enlightened” decides how much is enough. Note that everyone was equal there, but some were more equal. Ironically, the often maligned “greed” ends up producing a lot more wealth overall, though it also (unfortunately) produces enough free time to them complain about the people getting “too rich.” :)

    An example of the difficulty of determining “What is enough?” would be my own housing. Some people think I could live in a 2 or 3 bedroom house while I think our current 4/5 bedroom is quite reasonable, even later on. Who is “right”?

    I do agree with the idea that much more is available than people want to acknowledge. Crying out against “greedy” people makes for great politics, but it is ultimately harmful to a society.


  13. paula says:

    I haven’t read the book Trent has reviewed, or the one he gave away, but I have read “Your Money or Your Life,” which he has reviewed and referred to on many occasions. From that, I feel safe in answering Brad’s question about who decides “What is enough?”

    YOU decide “what is enough.” You have apparently decided that your house is reasonable for you. And you think it will continue to be so. Great. Hold onto that thought. And when the guy who works next to you gets a fancier house and brags about it, don’t be swayed into thinking you should upgrade into a house that will be more impressive to others. That’s the philosophy at work here: Finding your own comfort point, not pointing fingers at someone else’s greed.

    Decide what is excessive for you, and I’m happy to leave you alone. However, if you can’t figure out what you want in life other than “things” and “more stuff” and find yourself unhappy in spite of your stuff, then track down this book and the others that Trent has recommended.

    Trent, keep pointing your finger towards the path you are finding for yourself, because people are clearly happy to follow you.

  14. Mitch says:

    Has anyone here read the book yet? I wonder if by “left-wing rubbish” he means “the rubbish that is inherent in being left-wing” or if he means “the flavor of rubbish that is found on the left side, e.g. the New-Age”?

    Because if it’s the former, then it sounds like a book that might be worth making myself read, adjunct to YMOYL et al–I was, after all, brought up in the religious left and now belong to the agnostic left (the religious part totally didn’t take, but the Methodist social gospel and the Mennonite pacifism kinda did). But if it’s the latter, well, I don’t like being preached to from the left much more than I like being preached to from the right. (8

  15. js says:

    The 401k invests in Halliburton!! Talk about vice.

    I’m not at peace with that, but I’m still putting money into that fund for now :\.

  16. Minimum Wage says:

    The SUV driver’s gas guzzling makes gas more expensive for everyone.

    Does anyone seriously expect the working poor to believe scarcity is a great lie?

  17. rhbee says:

    I am a real believer in the serendipitous. Since, I started thinking and writing about personal finance I have found myself having a growing concern about the tone of many of the posts and blogs I have encountered. So I wrote an entry about what would I do for money. Now, as Trent pointed out, the topic has come to this internet neighborhood. There is a reason for this. Writing is an introspective art. Even writing a comment can show you that. The more we write the more we look inside even as our outside personal wealth demands our attentions. What is enough? Why did Trent’s sister happen to mention this book? When will people stop dividing up the world they live in by worrying whether an idea, a good idea, comes from the left or the right? When is enough enough?

  18. JD says:

    There is a Swedish term, lagom, which translates roughly as “the right amount”. A great article online about that concept suggested that “enough” implies “scarcity” in some way, but “the right amount” truly guides one’s choices for reaching out for more, or changing the direction of the reach.

  19. JD says:

    This is the url for the article I cited above but couldn’t find to post. “The Right Amount”

  20. Wanda says:

    The pie can grow (i.e. the technological advances of the 1980s-now have created so many new jobs … making real money off of Second Life? priceless!), but there is always going to be a pie. And it’s not unlimited. I mean, economics is built on the whole concept of scarcity. But I agree, the feeling of having “enough” is something that pretty difficult to get, especially with everyone in the race for bigger and better things.

  21. rhbee says:

    I found a rather interesting article about this topic in the LA Times (left coast rubbish, right?). Anyway, it was a review of a cyberspace game called Entropia. Apparently you can earn real money playing there. The primary rule of its economy is scarcity. “People actually seem to prefer systems with artificial scarcity as opposed to digital abundance where everyone can have everything, but nothing has any meaning anymore.” Go to http://www.latimes.com/technology/la-ca-webscout27may27,1,3191869.story?ctrack=1&cset=true

  22. ck_dex says:

    “This book is about finding a new freedom, truth, and joy in our relationship with money, this strange, troubled, and wonderful part of our lives.”

    Rather than sounding like “a liberal preaching to me about how to live my life…” the summary sounds like conservative evangelical preachers who try to convince us that Jesus was a businessman.

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