Money, Life, Retirement – 2. What to do with Money

“A man is rich in proportion to the number of things he can afford to let alone.” Henry Thoreau

In the previous rambling I argued that the most important definition of money is special paper tokens that you exchange large portions of your life for via employment.

It got a little extreme, it was perhaps a little confronting relating every trivial transaction that you make with your own mortality, I even used hashtags.

But if you shouldn’t fritter away your precious non-renewable life force on expensive skinny soy cappuccinos and designer handbags, what should you spend these special paper tokens on?

To start with I’d like to talk a little about hedonic adaption.

From a genetics point of view, by the very fact that you are here reading this blog at the end of countless generations of sexual reproduction means that you, out of all the possible permutations of your ancestors are likely the best at adapting to your current environment. People are good at adapting to environments and as part of that we are good at adapting to things. You are an adaption machine.

Say for example you have an old 2000 model Toyota Corolla. Probably a pretty reliable car, it doesn’t cause you any discomfort by breaking down, meets all of your transport needs but doesn’t particularly make you feel good when you drive it. A 2000 Toyota Corolla doesn’t make anyone feel sexy or good about themselves. Say one day you decide to part with $25,000 of your hard earned paper life force tokens to buy a brand new Toyota Corolla. Oh what a feeling.  In the first week you’re offering to drive your friends anywhere they want to go, doing unnecessary errands and trips, because you enjoy the feeling of driving this new car. It makes you feel happy.

But the problem is that the happiness you gain from a new thing is temporary. In 2 months’ time all happiness resultant from the new car feeling is gone. Your brand new Toyota Corolla has become just a functional means of transport. Compared to your previous corolla there is no long term net change in how the car makes you feel when you drive it. You’ve become used to it. What has changed though is your bank balance. $25,000 of your paper life tokens gone. Perhaps you manage to save $12,500 per year. What you have done is exchanged two years of forced labour for a brand new car that is perfectly functional but does not increase your happiness one bit in the long term when compared to your last one.

Hedonic adaption is the ability of your brain to become used to anything that once bought you happiness.

Studies have been done on this topic by surveying recent lottery winners and recent paraplegics. What was found that the lottery winners were above their usual happiness level for a time, but over time they adapt and their happiness levels return to normal. Similarly the paraplegics were found to be unhappy after their accident, but then over time their happiness levels basically returned to normal.

What I propose is that rather than spending large amounts of your paper life force tokens on things that you will become used to and won’t increase your happiness any in the long term, that you’re probably better off if you invert and spend your paper life tokens taking things out of your life that make you temporarily unhappy.

For example, say you really dislike doing the dishes. Is the feeling of last nights mashed potato being squeezed between your fingers under the dirty dish water enough to make you spew a little in your mouth? Spend some of your paper life tokens on a dishwasher. Never have to touch underwater mystery food again.

Similarly, if you wake up every weekday morning, labouring through the same morning commute, the same office politics, deadlines and tasks like a real life perverted Groundhog day, only to reach the end of the day to then eat, sleep and prepare to do it all over again. If you think that your precious finite life would be better spent going surfing , bushwalking, or any other activity of your own choosing each morning, perhaps to increase your happiness you should remove this source of displeasure from your life.

I’m sure that a lot of people don’t directly relate full time employment as a source of displeasure. What I think is that people don’t understand the freedom that they have given up by this commitment. By committing to full time employment you’ve limited the time that you are free to be in control of your own life to only 2 days a week. 2 days a week tis but wafer thin monsieur.

Put in a stronger sense, I think anyone that defends their choice to commit to full time employment is suffering from Stockholm Syndrome. You are a captive. Any free will you have is perceived, a shallow attempt to rationalise the dire situation you’ve found yourself in as you think there is no way to escape. You should know that your captor only has their own self-interest at heart.

Only when you’re in the position where you don’t have to work indefinitely is the choice to commit to full time employment valid, up until that point it is not a choice, it is a decision made under compulsion.

So to take this back to the original question, what should you spend these paper life force tokens on? You exchanged large portions of your precious finite life being a captive in exchange for these tokens, hence in my view you should spend them on buying your freedom.

How do you do that?

1. You work out how many of these paper life force tokens it takes to maintain your life
2. You work out how many of these paper life force tokens it will take to maintain your life indefinitely
3. You work out a way to accumulate that many paper life force tokens
4. You work out how long that will take and track your progress at regular intervals.

To some the dot points above may seem unachievable, but I can assure you, by harnessing the super power of compound interest this is achievable by anyone. Compound interest is a super power.

Keep reading for ramblings, details and tools to assist with the above.

Link to the next post

Money, Life, Retirement – 1. Introduction

“And finally, monsieur, a wafer thin mint”, Maitre D

 

Introduction to the introduction:

So I’ve been thinking about this series of posts for a while now. I often feel like everywhere I go, every conversation or interaction I have, that this topic is the elephant in the room. Often the elephant is standing on peoples necks, shitting elephant shit on peoples shoulders or trunk punching people in the testicles/uterus, but for some reason I seem to be the only person aware of this cheeky grey menace.

I think money, how you use it, and spending the largest part of your life working by default without making a conscious well informed decision to do so is the most important topic in your life, but nobody talks about it. Not making a conscious decision is in fact making a decision, a decision to be someone who makes bad decisions. In terms of extreme ramblings, this will definitely be one…**

 

Actual introduction:

So, what do you think of when you think of money?

Do you think of fast cars, fast women/men and champagne?

Or do you perhaps think of a faith based medium of exchange that has no intrinsic value of its own?

Or do you think of it as special paper tokens that you exchange large portions of your life for?

All of the above are kind of true. Money can be exchanged for all kinds of hedonic pleasures or short term thrills. Fiat currency is perhaps the largest example of species wide group think, a cultural construct that only has meaning because everyone else believes it does. Money is in fact the result of expending large portions of the finite time that you have here on this earth in what we call employment.

Out of the three examples above, it’s the third one that has weighed on me the most over the last few years.

I’ve had a reasonably unique experience compared to my peer group. At the age of 34 I’ve had a total of 3 years off work  in two big juicy lumps. During this time off I did whatever it was that I wanted to do. Such as travel, fishing, surfing, camping, growing a ginger beard, designing things, building things, demolishing things, reading things, learning things etc. When you have that amount of time off work your time is quickly filled up with things you want to do and enjoy doing. After about 3 months you start to wonder about how you ever had the time for full time employment in the first place.

Contrast this with how you feel when you get back to work. Going from having 7 days a week, 365 days a year to fill with any number of activities that you choose, to being an employee for 5 days a week, commuting to your place of employment at the beginning and end of each day, having an hour of sunlight if you are lucky to do non employment related things before having to cook, eat, clean, go to sleep and do it all again the next day. Only having a wafer thin 2 days a week to do things that you choose uninterrupted by commuting and employment.

To put this in context, here are some examples of how much time I spend in employment related activities vs time I spend in activities of my own choosing:

Time at work: 8:30 am until generally 5:30 pm – 9 hours per work day

Time commuting to work (by bicycle): 45 minutes each way – 1.5 hours per work day

Total hours per week: 52.5

Time spent mountain biking per week: 3 hours per week

5.7% of the time I spend at work I spend mountain biking on the weekend

Time spent surfing per fortnight: 3 hours per fortnight

2.8% of the time I spend at work I spend surfing

Time spent fishing per fortnight: 5 hours per fortnight

4.7% of the time I spend at work I spend fishing

Time spent having sex per week: 10 minutes per week

0.03% of the time I spend at work I spend having the sex!!!

(Ok, perhaps the last example was exaggerated for the sake of my rambling. It’s probably closer to 15 or maybe even 16 minutes.)

Thought of in this context, it is clear that money is a direct result of a bargain you strike with your employer to hand over a very large portion of your life in exchange for special paper tokens you can exchange with people for other things.

So what do people generally do with these paper tokens that they’ve exchanged very large parts of their finite life for? Is it treated like the precious non-renewable resource that it is? (your life is of course not renewable) or is It treated like a renewable resource that will be around forever and can be fritted away on the next thing that takes your fancy?

Referring to the graph above, mostly it’s the second one. Most people live in a world of expensive take away coffees, brand new cars, shoes, handbags, designer clothes and mega mortgages.

We’re continuously told via advertising and our peers that you should spoil yourself, you’ve worked hard, and you deserve it.

But what is so obvious and yet hides in plain sight is that there is of course a counter party to every single transaction. Every overpriced take away coffee has a counter party on the other side that is entering into the transaction only because they think this transaction will be beneficial to them, and by inversion, probably negative for you. Across the counter at the car dealership, hand bag store or mortgage broker is a suit wearing vampire that wants to suck your finite life force straight from your veins via a proxy we call money, while all you’re interested in is getting the right photo of you smoothing out that sold sign on the real estate for-sale sign and smiling just right for your Instagram followers. #sold #nesting #Ididntevendosimpleyear8mathematicsbeforedecidingtoenterintothismountainoflifecripplingdebt #yolo

So what should you do with these paper tokens that you’ve exchanged large parts of your life for?

I’ll ramble about that in the next post.

Link to the next post

** I’ve been thinking about my motivations for writing all of this and what they may be. Is it perhaps my need to convince people of my argument to satisfy my need for social proof? Is it some kind narcissistic virtue signalling? Is it some way to publicly back myself into an inconsistency-avoidance tendency based corner? Or is it that I’m just worried about that a few years from now I’ll be retiring really early and eventually I’ll get bored of fishing every day while all my mates are still stuck working full time hating their lives compared to my relative freedom? It’s probably a little of all of them.

Besides an original hashtag and a pretty serious spreadsheet or two there’s not much original thought in this series of ramblings, everything here has been mentioned by some pretty smart, rational people before, I’ll give a reading list in the last post of the series.

Noahs Beach

Noahs Beach is close to the end of the bitumen in the Daintree rainforest near Cape Tribulation. Hence it gets a bloody lot of wicked camper vans and long haired hippies cruising through. While the hippies were plaiting their dreadlocks and discussing existentialism we were of course busy wrestling monsters from the deep on the beach.
Existentialism this, hippies!:

A 92cm permit, it would have weighed around 15kg, and took about 15 minutes to get onto the beach. Food for a week.

The goannas were pretty fond of beer around here and perhaps a little too friendly, we got chased by a big one who really liked the smell of the fish frame.

FACTS:
How to get there:
Follow the signs past cairns to the daintree. You need to catch a ferry across the daintree River which cost us $19 one way with a trailer. The ferry runs 6am until midnight.
Camping Cost:
5.95 pp per night
Boat Access:
There’s no boat access here, although apparently there’s a boat ramp at Thornton Beach though.
Other Opportunities:
There’s plenty of touristy guided walks you can do in the area.