ATM Book Club: Week 1 (intro)

For the next two months or so, I’ll be running a very informal book club here at the blog, working through the chapters of All the Money in the World: What the Happiest People Know About Getting and Spending. In future weeks, I’ll link back to previous book club posts, so you can jump in at any point.

This week, I’ll start at the beginning (which I hear is a very good place to start). In the introduction, I talk about what happy people believe about money. The first thing they need to believe is that they have enough. While there are a few people with more in this world, there are also quite a few with less. They also feel in control of their money in the sense that they believe they can expand their resources over time if they want to. And finally, they view dollars as choices. Happy people believe that how they earn and spend their money is up to them.

It’s the last point that I think would make a good discussion topic. Are dollars choices? What do you most dislike spending money on (or as much money on as you do?) Is that possible to change over time? If someone were to look at how you earn and spend your money, what do you think they would take from that survey? What would they say your values were?

Looking at how I earn my money, I think an observer would note that I really, really want to like my work. I’m not sure where I developed the deep belief that work is supposed to be fun, but that belief shapes my entire worldview. I’ve on occasion taken big financial hits to preserve my enjoyment of writing. When I stop enjoying a gig, I quit. I also really like having my name attached to stuff. Ghostwriting is among the more lucrative things I’ve done, but very few projects along those lines advance my own career. The exception would be an obvious blockbuster where I was given credit on the cover. If I knew I needed more cash for big goals, I might also take on a project. But if I don’t right now, then I should put my mental energy into other things.

As for how I spend my money, an observer would note several things. First, I believe in paying my taxes (I’m sure someone could argue that withheld taxes mean that dollars aren’t really choices, but spend a while in the freelance economy, and you’ll see people getting away with all sorts of things — not something I would consider). Second, I view childcare as both an investment in my career and in my children being happy, healthy and well-prepared for school and life. In other words, not something I’d like to skimp on. An observer might also decide that charity wasn’t a priority for me. This is not something I’m particularly proud of, and would like to change over time as I figure out what my giving strategy should be, but that is probably the conclusion an observer would draw looking at my life right now.

What conclusions would our observer draw about your life if she could examine your finances? What conclusions would you like her to draw?

In other news: I was on Fox & Friends this weekend talking about the marginal cost of kids. If you didn’t get up at 7:20am on Saturday to watch me (I’m hurt!) here’s the clip:

11 thoughts on “ATM Book Club: Week 1 (intro)

  1. Since I just spent an agonizingly long time tallying up my receipts for tax purposes (there are great things about being a 1099, but taxes are not among them) I have a good idea of the categories where our money went last year. Our significant categories are giving, childcare, general living expenses (mortgage, insurance, groceries, medical), taxes, and IRAs. Out of the amount left over after those categories, I think people would think our priorities are education (ours and for our kids), music (my husband plays multiple instruments and takes lessons, the kids take lessons), and extended family (trips taken with and to see them).

    Thinking about the categories we spend on and what priorities they reflect was reassuring to me in much the same way that keeping a time diary was – I realized that although I often feel anxiety about both time and money, and have room to improve in both areas, overall I’m satisfied with the mix I have. I will say that the way we spend time and money in our family has changed over the last year or so, and it required us to shift our mindsets about how to earn and use both.

  2. @Catherine – yes, there’s nothing like receipt time to get a sense of where the money goes. That’s fabulous that you’re spending time and money on music. I think that’s something I’d like to pick up again. I’ve been playing my keyboard on occasion. Travel is also something I’d like to devote more resources to, and doesn’t seem like a priority right now (I realized the other day that I hadn’t been on a plane in a year which seems crazy given how much I’ve traveled at other points in my life).

  3. I think “having enough” and “having control” are great points. Right now, I feel that we have enough and that we have control.

    I think my concerns, and those of others, stem from “not enough” or “no control”. Hospital bills of my premature twins totaled ~$100k. It took many hours on the phone and a year for insurance to finally pay what it should, leaving us $15k. I had no control over the billing systems of the respective entities, nor control over the collections agencies that the bills were to be turned over to. At the same time, I didn’t think spending extra money for services was wise (my husband’s company cut salaries across the board that year and we don’t budget $15k out of pocket for medical expenses.)

    Like many Americans, our challenge is keeping/finding jobs to maintain (or only suffer a slow decline in) our standard of living. Right now, I wish gas were cheaper and that our school district weren’t forced to cut days due to budget issues. These budget issues are a result of the two largest employers in the area shutting down or substantially reducing their workforce (by 80% in the past 15 years) None of these are things I have any control over, and selling the house and moving to a new place, with no social network or career established, isn’t a great option either.

    Basically, you only have control over part of your financial situation. Realizing this has messed with my “internal locus of control.”

    In your situation, how much of your freedom to choose “work you love” is because you don’t have to either 1) fund half the household/childcare expenses or 2) fund all the childcare costs with after tax earnings? I act essentially as a ghost writer for researchers (ghost editor) so no one knows my name. (I look for yours!)

    1. @Twin mom – some of my friends ghost a lot and are making more than I do. That’s actually one of the things that makes me feel like I have some control — if I were to become solely responsible for supporting my family, that is a part of my business I would drastically scale up. I think in a year or two (which I could cover through savings) I’d be able to have a good ghosting shop going. Right now, I’m focusing on building the brand, which will hopefully give me more opportunities in the future if things do go south (or if they don’t). But the “enjoying your work” part of my personality predates my current set-up. When I moved to NYC without a job, I took a part-time gig at a travel PR company. It was a disaster. I disliked it and I wasn’t good at it. So, despite having no particular long-term income guarantees, I quit. It wound up working fine — not having a regular income kind of lit a fire under me in terms of going out and finding work.

      1. Great response- I wasn’t trying to be controversial. I’m in a similar position, with a husband who earns a lot more BUT who has unplanned travel obligations, etc. I suppose this is why it’s so hard to be a single parent.

  4. A survey of my recent spending would reveal several things: 1) I like to keep basic living expenses low. Rent + utilities + insurance + groceries, etc. = ~1/3 of my take-home pay; 2) I value education, as a significant percentage of my take-home pay–more than 1/3–goes to pay down debt accumulated in graduate school. The decision to take on debt in order to focus on school rather than working a second job (in addition to teaching/research assistantships) was an intentional one that I regret only on occasion. 3) My charitable giving is sporadic. I regularly give to a couple of organizations, so this could be automated.

    I love what I do (teaching and research) and accept that professional advancement at this point in my career depends on doing the kinds of things that are rewarded in the academy, which generally don’t involve extra pay. Every now and then, I will participate in a “paid” conference, but these are rare and I will occasionally turn them down if I deem the money (rather than the subject or list of attendees) to be the main enticement.

    1. @Sara – thanks for your comment. I know a lot of people lament student loans, but if they are taken out intentionally, and with an eye on affording an education you really want, then paying them back can be a tolerable experience. Every time you pay you remember why you made the decision.

  5. A stranger looking at my lifetime flow of cash in and out would note a lot more in than out. Mostly, I feel lucky and grateful about that, but when I really think it through I realize that others would have spent more. I have always made lifestyle decisions that were considerably less expensive than my income. In my twenties, it was no car. Now, in my fifties, it’s a house I love that is much less than the most I can afford. Still, luck had a pretty big role and gratitude is both legitimate and helpful.

    Also, they would note that charitable giving was not a priority until about three years ago. Like you, it was actually higher priority in my mind than I managed to implement. It turns out, waiting was good. Now, I get to do it in a bigger way with bigger intangible rewards.

    1. @Joy – that’s what I’m telling myself. I’ll do it in a big way at some point, and hopefully that will have a lot of impact.

  6. Definitely 2 things stick out: childcare and other expenses for our one toddler, and food. We spend a stupidly large amount of money on daycare – almost $2K per month, but are confident that it’s some of the best care in the city of Chicago, and the teachers have become really good friends of ours. Huh, kinda sounds like the fraternity/sorority aspect of buying friends. My wife also like to buy high-quality clothes that will be grown-out of in short amounts of time. It makes her happy so I don’t really mind, unless it gets out of control (a few times).

    I converted my wife into a foodie, and pre-baby that’s where all of our money went. These days we go out to eat less but buy high-quality, probably organic, often local food for us at home. The past 3 summers we’ve bought into a CSA that reduces the price of veggies to $35/week.

    By the way, my wife and I are enjoying the book and are taking turns reading the chapters to talk about them together during our morning commute. It’s like a mini-commuter book club!

    1. @Him – glad you guys are enjoying the book, and how fun to turn it into a book club on your commute. Also, I love that you commute together. Daycare is one of those things where being penny wise can certainly turn into pound foolishness. If you’re worried about your kids’ safety or happiness, or if your care isn’t reliable, you won’t be able to concentrate on your job. And while losing your job would solve the problem of childcare expenses, that’s probably not what most people are aiming for…

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