By: PanzerGrenadier
Transforming Your Relationship with Money and Achieving Personal Independence
I had heard of this book many times through surfing the net for personal finance websites and blogs and finally decided to order this instead of borrowing it from the public library on a whim. What a decision it was…
Unlike most personal finance books that provide tactical ways for you to be better at managing your money, “Your Money or Your Life” takes a similar and yet different tack. Fundamentally, why this book is different from other books is that underneath the 9 step technique, the ethos of the authors is alignment to your values, your personality and yourself. It is not about right or wrong but about examing your life through the various exercises aimed at making you aware of what is your relationship with money.
The book’s blurb says that it shows you how to:
- get out of debt and develop savings
- resolve inner conflicts between values and lifestyle
- reorder material priorities and live well for less
- slow down the work-and-spend treadmill
- make values-based decisions about your spending
- discover the power and perfection of “enoughness” - and know how much is enough for you
Bullet points one seems to be close to the standard books that talk about personal finance. However, the second and third bullet points are areas less explored by other books, which connects with me as those are areas I have been exploring even without having read the book and resonates strongly.
Bullet points one seems to be close to the standard books that talk about personal finance. However, the second and third bullet points are areas less explored by other books, which connects with me as those are areas I have been exploring even without having read the book and resonates strongly.
Making a Living vs Making a Dying
The first chapter of the book sets the stage but asking us tough questions on why we deem subsisting in the rat-race as making a living when in reality it could be seen more as making a dying. We get caught up in the endless work-earn-spend-work cycle that defines most of our adult lives without thinking about whether there is more to life than this.
I have been exploring financial freedom with this blog since early 2007 and learning to manage my own finances since the early 2000. I realize that through trial and error, mistakes and tuition fees, I have managed to get slightly ahead of the curve but am still caught in the rat-race though as a less frantic pace as I have very little debt and has built up a decent amount of personal net worth.
The book echoes many of my own feelings towards life in general and I remember a period of time when I was involved in toastmastering activities that gave me so much fulfilment even though I was not paid a cent to help coach others in public speaking.
“Your Money or Your Life” shares with us how consumerism and materialism has made us reliant on buying “stuff” in our lives to make us happy. However, there is a limit on how much happiness we can get from “stuff” instead of relationships and connecting with people. The law of diminishing utility or “fulfilment curve” referred to by Joe Dominguez and Vicki Robin afflicts everyone of us no matter what the income level.
Chapter 1 engages us to firstly, establish all our lifetime income earned till today and to create a balance sheet of our net worth. This allows us to see how much money we have earned in our lifetime and what we have to show for it.
This sets the stage for the other 8 steps in transforming our relationship with money and achieving financial independence.
Key takeaways
The main takeaway from Chapter 1 is that the authors feel that materialism and consumerism is the root to many of our money problems. In order to re-order our relationship with money, we start by looking at the past (how much we have earned in our lifetime) and examine the present (how much net worth do we have).
This is the starting point for many personal finance books as well, to take stock of your net worth. I have already been tracking my net worth so I didn’t have to do much for this exercise but I worked on the lifetime income and was astonished with the figures. I compared this to my net worth today and realized that I was quite frugal in my earlier working years which helped to contribute to where I am now.
I don’t claim all the credit because really, it was my parents’ frugality that rubbed off onto me in my adult life.
Panzer’s Your Money or Your Life Book Review Series.
- Your Money or Your Life - Panzer’s Book Review [Part 1of 9]
- Your Money or Your Life - Panzer’s Book Review [Part 2 of 9]
- Your Money or Your Life - Panzer’s Book Review [Part 3 of 9]
- Your Money or Your Life - Panzer’s Book Review [Part 4 of 9]
- Your Money or Your Life - Panzer’s Book Review [Part 5 of 9]
- Your Money or Your Life - Panzer’s Book Review [Part 6 of 9]
- Your Money or Your Life - Panzer’s Book Review [Part 7 of 9]
- Your Money or Your Life - Panzer’s Book Review [Part 8 of 9]
- Your Money or Your Life - Panzer’s Book Review [Part 9 of 9]
