YMOYL Chapter 4: Answering The Three Transformative Questions

New readers: This is an in-depth, chapter by chapter review and analysis of the book Your Money Or Your Life. Join us! You can buy YMOYL here, and you can find the first post in the series here. Finally, if you have any questions or issues about the book you'd like to discuss or debate, share them in the comments.
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At last, a chapter of YMOYL that has us do some real work. In Chapter 4, we'll take a careful look at the spending and financial information we've gathered so far, and we'll apply some sincere and ego-free value judgments to it.

A quick review of the process: First, take the spending categories and subcategories you created in Chapter 3. Add up the money spent on each. Then calculate the hours of life energy spent, by taking the total cost of each category and dividing it by your real hourly wage. Not too complicated, right?

The next step, however, is the most involved--and by far the most important. We're going to evaluate each of our spending categories with the following three questions:

1) Did I receive fulfillment and value in proportion to life energy spent?
2) Is this life energy expenditure in alignment with my values and purpose?
3) How might this expenditure change if I didn't have to work for a living?

Under each of your spending categories, then, you'll assign a box for each of these questions, and in that box you'll put a plus sign, a minus sign or a zero.

For example, with question #1, a plus sign in a given category means you did receive fulfillment in proportion to life energy spent--in fact, you received so much fulfillment that you'd consider increasing spending on this category. A minus sign, however, would indicate you didn't feel your spending in this category was worth the life energy cost. With question #2, a zero means you're okay with the match between that spending category and your values, but a minus sign means that this spending category doesn't match your values, and should thus be reduced. And so on.

There's a basic example of this exercise on pages 110-111, and then some personalized and more complex examples on pages 127-130. Laura and I found these example charts to be extremely useful--they helped us organize our spending categories, and they gave us good ideas for how to organize the format of our chart.

Remember, this is your tool to use as you see fit. You can take it to a high degree of detail and evaluate literally every single spending event with the three questions, or you can be less detailed and just focus on broader spending categories. Your choice. Do what helps you be more conscious about your spending and your values.

The only specific recommendation I'll make to readers is this: don't blow off this step. Chapter 4 in general--and the three questions in particular--is where the proverbial rubber meets the road in YMOYL. It's a powerful framework that helps you see where your spending matches, or doesn't match, your goals. If you want to get maximum value from this book, don't skip any exercises. But most of all, don't skip this one.

Finally, if you see a lot of minus signs on your chart, don't be upset with yourself. Be grateful. You're simply making a long-overdue, honest analysis of how you spend your life energy.

Which takes us to the last and most important step: Use those minus signs to start making adjustments. Think about where you can change your spending so that you can replace those minus signs with 0s or +1s. It's time to start allocating your life energy in the way you choose, and make sure your purchases and your behavior are truly conscious and consistent with your goals.

Readers, when you completed this exercise, what did you see? Were you happy or unhappy with the distribution of plus signs and minus signs? What adjustments do you plan to make?

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Appendix/Side Thoughts:
1) The most important question: All three of the "transformative questions" are important, but in many ways Question #3 is the most important. Why? Because once you realize how you might increase (or decrease) an expenditure if you weren't working, why not make that change now? Essentially, Question #3 gives you your roadmap for living your ideal life today, rather than at some undetermined point in the future. This is mind-opening stuff. (PS: For more on this subject, I recommend the book A Year to Live by Stephen Levine.)

2) Uh-oh, that pesky ego again: When we're on the verge of great personal insights, our egos tend to push back--hard. People can become hyper-sensitive and even irrational when asked to question the things they've always done and the spending habits they've always borne. Yes, I can see I have a big minus sign under "shoes" but I deserve them. It's my money, and I don't want to deny myself.

But what are you denying yourself, exactly? Are you denying that those minus signs are sitting right there, in black and white, written in your own handwriting? Stop denying, and start reallocating your life energy so it truly meets your needs.

3) "In fact, no one is even listening" Although it's sort of a throw-away phrase on page 112, this quote is an excellent one to re-read if you feel your own ego cropping up in response to a poorly allocated expenditure.

Think about it. When someone else tells us to cut our spending, of course our egos rear up. But no one is telling you to do anything. No one is trying to take your gazingus pins away from you. In fact, no one is even listening. It's just you, alone, seeing with total clarity and finality the misallocation of your own life energy. Now, the real truth starts to become clear: Your gazingus pins are booby prizes.

4) Don't get wrapped around the axle defining fulfillment--let the book show you: In some ways, I think the authors made a mistake by starting off Chapter 4 with all of those questions about dreams and fulfillment. As an example, my blogging colleague Oil and Garlic, who's working through YMOYL on her own blog, got stuck on all the fulfillment questions at the beginning of Chapter 4. So did we.

But it's okay if you don't know exactly what fulfills you right away. Instead, use this chapter as a tool to help figure it out. At the very least, it will direct you away from activities that squander your life energy and lead you away from fulfillment. And at best, you might have the same result Oil and Garlic had: after a few weeks of rumination, she actually did arrive at some compelling goals and dreams. Let the book help you along on your process of self-discovery and you may very well surprise yourself.

5) Giving short shrift to Chapter 4: Here comes another confession. I warned readers above that skipping exercises would cost them both value and insights. Trust me: I know of what I speak. Laura and I gave short shrift to Chapter 4 when we first read YMOYL ten years ago. It was a mistake.

We carefully did the expense tracking as well as the other exercises in the first three chapters of the book. But in this chapter, we dropped the ball setting up our expense categories and applying the three questions. Essentially, we read the chapter, but we didn't do the chapter. It was our loss, and we missed out on some big opportunities for insight.

I'll give a quick example of what I mean by missed insights: Since 2008, I've been retired from full-time work, so I'm now asking Question #3 of myself in an unusually literal way. I'm literally "not working for a living" right now... and I'm finding that I don't have good answers for how my expenditures should change! I would have been much better prepared had I thought through these questions before I had retired--and I missed an opportunity to do so when we read this book for the first time in 2002. It was my mistake and I regret it.

I'm not going to repeat this mistake. This time, we're making a deliberate effort to follow every chapter to the letter.


Next Week: Interlude: A Look Back At What We've Done So Far





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