Today is launch day for All the Money in the World. A lot has changed on this blog since my last launch day, for 168 Hours in 2010 (here’s the “Hello World” post on that, which I think is worth a read, but I’m biased). That book brought a lot of opportunities into my life, including the chance to write this book.
But, like many opportunities, writing All the Money in the World (ATM) was not easy. 168 Hours was a breeze to write. Not this book. I think the introduction alone of ATM went through six entirely different versions. We worked out a book deal in September 2010 but we didn’t settle on a title until late April 2011, at which point I’d written 90% of a draft of a book. So there was some shuffling around. The whole manuscript went through beta-testing, and what I like to think of as fermentation as I moved to the ‘burbs and had various other thoughts on how people spend their money. Finally, in September of 2011, as I was editing yet again, putting in more stories, I realized…I actually liked this book. I was having fun reading it. And I hope you will too.
So what did the happiest people teach me about money?
1. Sweat the big stuff. In the course of my writing this book, my family moved from New York City to suburban Philadelphia. The top tax rate in NYC (state plus city) is above 12 percent, and comes out around 10 percent for middle incomes. The top tax rate in these parts is about 6.5 percent for PA state plus Philadelphia wages (for non-residents). Income earned outside Philly (as mine is) is a flat 3.07 percent. So we’re talking a 4-9 percent spread, depending on how things go. I love NYC, but at this point in my life, I didn’t love it enough to pay a premium to keep living there. I visit frequently instead. You can afford a lot of train tickets for the difference in cost of living.
2. Splurge on little things. This is the corollary to point #1. If flowers make you happy, buy flowers. If lattes make you happy, buy lattes. Even if you go wild, you probably won’t manage to spend 4-9 percent of your income on either of these categories! If you spend less on big stuff, you’ll have space for the little things in your budget, and likely will still be able to save.
3. Money may not buy you love, but it does buy you options. None of us knows what life will bring, but in general having more assets gives you more control over a situation, and can make even a bad situation more comfortable. Money can’t keep you from getting cancer, but it means you probably have good insurance, and can afford extra help while you’re in treatment, the ability to stop working without it bankrupting you, etc.
4. Don’t scrimp more, make more. No matter how badly you need more cash in your life, cutting back from your current standard of living is painful. Set your expenses low if you can, but if they’re already set, it might be more pleasant to figure out a sideline that could bring in some extra cash that you can then save and put toward big goals. If you can’t stomach the thought of working more, then you’ll have to cut back, but at least you’ll be more motivated if you know that you feel the alternative is worse.
5. Reconsider the Joneses. I know who my “Joneses” are. I run past their house once or twice a week. It’s this gorgeous estate on 6 acres. I looked up the address the other day and it turns out the house is for sale. But as I was looking through the photos, I realized that even if I could afford it, there was no way this house would make me multiple times as happy as mine does. Frankly, I’m not sure I’d be any happier in it (the basement looked kind of musty). The owners are also paying multiple times what I am in property taxes for the same services and schools. This realization has made me even happier with my abode.
6. Not everyone needs to raise backyard chickens. Lots of people are into chicken-raising. Lots of people are into gardens, too. I think both are neat ideas, but I don’t like spending my time on gardening or chicken-raising enough to make such things rise to the top of the priority list. We should spend our time and money on things that are meaningful to us. Just because DIY living is meaningful to other people — or any other activity — doesn’t mean it will be for you. Know yourself.
7. Spend on adventures. Doing things takes time, money and energy, and especially if you have little kids those things are often in short supply. But life is basically one giant memory. Creating good ones is a good use of cash.
8. Give big and thoughtful gifts. Both to people and to organizations. Gifts nurture social ties and happy relationships are key to happiness overall.
9. Do work you love. Then you won’t want to retire. That’s important because retirement is not generally good for one’s financial situation. Create multiple streams of income so even if one gig goes, you’ve got money coming in.
10. Dream big. Whatever your financial situation is now, over time you can probably change it. And when you do change it, your life will feel more purposeful if you know what you want to do with your resources. Money is a tool that can help us build the lives we want, and a world we’d want to live in. Someday you may have a fortune. So build a life worthy of it just in case.
If you haven’t already purchased a copy of All the Money in the World, I would be incredibly grateful if you’d do so. Please let me know! If you see the book somewhere, I’d appreciate a picture, and please send me links to any blog write-ups you see.