YMOYL Chapter 7: Redefining Work

For new readers: This is an in-depth, chapter by chapter review and analysis of the book Your Money Or Your Life that we're running throughout the month of January. Join us! You can buy YMOYL here, and you can find the first post in the series here.

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It's time to put work in its proper place in our lives, and break the connection between our jobs, our income and our identities.

Like every other chapter in Your Money Or Your Life, Chapter 7 builds on the steps before it, so let's quickly put this chapter in context. First, YMOYL makes you far more conscious of the money you spend, and it annihilates your ignorance about where your money goes. Second, it helps you escape consumerism when you align your spending with your values and principles. Third, thanks to the maxim what gets measured gets controlled, your expenses fall materially as you follow the steps.

In other words, after two or three months of carefully following this book, you'll be saving significantly more money. Every single month.

This sets off an important virtuous circle, because once you're regularly saving meaningful amounts of money, and once it starts piling up in your bank account, you'll find yourself less and less dependent on your paycheck. And as you complete more and more months of your Wall Chart, your near-term financial needs will become less and less pressing--until they're simply no longer a source of stress in your life. If you're doing each of the steps, this will just happen. Trust the process.

For many readers, this will be their first real taste of freedom from the cycle of work-spend. And with this taste of freedom, you can start to take a longer view about the work you do. What is your work really for? Is it satisfying? Should it meet more than just your financial needs? How much primacy does work really deserve in your life?

The way I see it, Chapter 7's purpose is to help us transition from a necessity-based definition of work to a self-actualization-based definition of work. In other words, now that we have greater financial resources, we can move away from other-centered reasons for work (I work for the money, to put food on the table, to pay off my debts, to become CEO, to impress others, etc.), and we can begin to consider inner reasons for work (I work to make a difference in the world, to help others, to acquire specific skills, to be challenged).

Here's the insight: you simply cannot make this psychological transition while you're under financial pressure. And that's why so many people feel like they're locked into jobs that suck. (It's also why people lash out in the comments of many personal finance blogs.) But once you're no longer in a position of financial weakness, you can start to live life on your terms rather than on your employer's or anyone else's terms.

The Two Year Buffer
Now for some practical advice. Instead of getting overwhelmed by a huge long-term goal like financial independence or permanent freedom from work, I encourage readers to focus on an aggressive, interim goal like saving up enough money for two full years' worth of expenses. If you've already passed the two year milestone, feel free to pick the next largest increment that feels right to you--five years of expenses saved, seven years, ten years, whatever.

In time, you will come to consider a two year buffer a mere steppingstone on your journey towards financial independence. For now, though, this should be a highly motivating and extremely effective financial goal for many readers.

"Two years of expenses saved" is also a big psychological benchmark. It's enough dough to protect you over an extraordinarily long period of unemployment. It's plenty of money to support you through a significant career change, a long sabbatical, or a major rethinking of your professional goals. It could be enough capital to start a business, or at the least enough money to fund your expenses during your startup period.

For me, the two year buffer was an enormously important hurdle. Once I reached it, it completely transformed how I thought about work. I felt liberated to take more chances in the workplace. And I was far less bothered by objectively petty things like office politics or dickhead coworkers. Hey, once work is in its proper place, work-related stress falls into its proper place too.

Finally, and most importantly, hitting two years helped me begin to believe that I could take it much further, and it laid the groundwork for me to hit a three year buffer, a five year buffer, a ten year buffer and so on. [For more on this, see my controversial posts Extreme Savings and How Much Money Do I Need to Retire?]

Where are you in your process of redefining work? What are the concrete steps you intend to take to put work in its proper place in your life? Keep using this powerful book, and in a surprisingly short time, you'll begin putting a healthy mental and financial distance between you and the work you do.

One last word of caution: Life can be quite a bit easier, existentially speaking, when there's a boss telling you what to do and a job taking up the majority of your time. And it can also be easier to blow off your own goals, and instead adopt the default-option goals imposed upon you by your boss, your company, or by the socially conditioned people around you.

After all, once you remove work as the centerpiece of your identity, and once you stop acquiring stuff and striving after other peoples' goals, then what do you do? Once you've realized that those goals were illusory and false, what's left?

You've got to find your own goals. You've got to find your own purpose. In other words, there's a benefit and a drawback to putting work in its proper place. The benefit: it gives you the empowering opportunity to choose your own life path. The drawback: it can be lonely--even frightening--to think for yourself like this.

Which is why some people may decide it's easier to avoid thinking for yourself. It's easier to go back to being in the crowd: working, spending, and living out the goals everyone else seems to have. Those people will scurry back to their cubicles and their old way of life, and they'll try to forget they ever laid eyes on this dumb book.

But not my readers.

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Appendix/Side Thoughts:
1) Did we win the Industrial Revolution? A fascinating question from page 203. On one level, duh, of course we won it. Look at life expectancy data, look at diseases conquered, look at literacy rates, look at wealth and poverty statistics. Look at the long list of basic amenities that everyone in the developed world now has that were beyond the reach of the richest kings and queens two hundred years ago.

On the other hand, look at what we're doing with these miraculous blessings. Are we happier? Less materialistic? Less shallow as a culture? Are we living life on "our terms" any more now than we did then? Think about this for a few minutes and you can easily conclude we lost the Industrial Revolution. Badly.

2) Confusing consciousness with worry: Recall the anecdote on page 210 about the two doctors who were so "busy" that they couldn't imagine keeping track of their spending. Worse, they rationalized not keeping track because they didn't want to "worry" about where their money went. Confusing consciousness with worry is classic ego defense. Classic.

Remember, it takes laughably little time to execute the steps of YMOYL, and the process actually creates time--not to mention it also creates money, via the what gets measured gets controlled principle. Using a false rationalizations like "I don't want to worry about my money" actually costs you.

3) "Retirement security is no longer secure." There's a fallacy baked into this statement (on page 204), because it incorrectly assumes that retirement security ever was secure. Many workers today hearken back to the good old days when a company (supposedly) took care of them and gave them a pension and a gold watch after 30 years of service. My father, who was born in 1930, actually worked for a company that literally did give him a gold watch after 33 years. Well, it was a gold colored watch.

A couple of thoughts. Even back in the supposed good old days of our parents (or, depending on your generation, grandparents), when everybody walked uphill to school both ways, a surprisingly small percent of workers got traditional pensions. Sure, they were somewhat more common than they are now, but they were never that common. Second, how do you think those pension plans provided for those workers' retirement? They had to do the same thing you're doing now: invest in a conservative mix of stocks, bonds and cash-based investments [Edit: we'll have much more on this later]. Also, plenty of pension plans failed, had crappy investment performance, and so on. Third, you had to stay at the same company your whole working career. And fourth, you would have had no protection from the worst risk of all: That you'd work till you were 60-something, retire, and then die before you could enjoy your years of freedom.

Today, we're basically all treated like grownups. There are great ways to save for retirement (IRAs, 401(k) and 403(b) plans, and of course our own aggressive savings plans using YMOYL), but at the end of the day, the truth is the truth: we have to figure out a way to look after ourselves. There's no company that's going to play the "parent" role and take care of us.

4) How to get a high paying, high integrity job: This section, which starts on page 228, might be the weakest part of the entire book. Granted, the authors include a caveat saying "This chapter isn't designed to be a job-hunting manual." That's for darn sure. The advice is vague, with statements like "Finally you must be able to recognize when you have been successful in achieving your goal." This entire section should have been nuked.

5) Don't confuse reading this series with actually reading the book and doing the exercises: I've talked about this already, but it bears repeating. And repeating, and repeating. I do not want dilettantes reading this series. In fact that's one of the reasons why the first few posts in this series were so long: I wanted to scare away the lightweights! What I want here are readers who take action, not people who read the series, talk about it, and mistake that for taking action. This book will make a difference in your life, trust me. But you've actually got to put it into practice.

6) More books to add to the reading list: One of the pleasures of reading is how any given book can give you a ton of great ideas for your next book. This chapter contains a good list of titles I'll probably be reading in the coming months:

Amy Saltzman: Downshifting
Studs Terkel: Working
Arlie Russel Hochschild: The Time Bind
Michael Phillips: The Seven Laws of Money


Next Up: Chapter 8: The Crossover Point






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