As most of you know Thom and I have been mainly self-employed since we got together over 37 years ago. Fortunately, we are currently more financially secure and wealthy than we’ve ever been throughout our lives. Are we rolling in money? Not hardly. But not a week goes by that we don’t hear how so many others are stressed about money, how difficult are these economic times, and how financially things seem to be getting worse everywhere in the world. So what makes me feel so good about money these days? It’s probably because Thom and I take a money SMART approach to our finances.
What is a money SMART approach? Remember, SMART is an acronym for Sustainable—Meaningful—Aware—Responsible—Thankful. When you add those five ingredients together it really does change both your perceptions and reality about money (or anything else). Don’t think you can change your reality about money? Well Thom and I are proof positive that you can.
Both of us grew up in similar blue-collar background where we were told, “Money doesn’t grow on trees!” Both of our dads never graduated from high school and mostly worked with their hands the majority of their lives. While graduating from high school may have been a priority in our households, college was never even discussed. And although Thom and I have taken a variety of college classes and are lifelong learners, neither of us have a degree. With a strong work ethic to guide us, we struck out on an entrepreneurial path and never looked back. Sure, in the beginning we struggled a great deal but we learned, adjusted and grew as we went—and that has made all the difference in the world.
Here is a brief list of when and what we learned about money through the years:
Youth (10 to 15)—both our parents taught us that if we wanted spending money to do fun or interesting things, we had to get a job and do it ourselves. Thom started mowing lawns and took on several paper routes. I babysat on a regular basis as much as I could. We both saved for what we wanted.
Adolescence (15 to 19)—both of us relished in the freedom that money could bring. As soon as possible we got better paying service-related jobs and bought our own cars, clothes and travel with our own money. Neither of our parents had the money to indulge us or treat us special so we figured out how to do it ourselves.
Adolescent Adult (18 to 25)—This is when we both learned that money wasn’t just for having fun. Once we were out of our parent’s homes we learned (sort of) to start paying our own bills and taking responsibility for the not-so-fun things as well. Fortunately, widespread credit cards weren’t available to get us heavily in debt before we learned most of the hard lessons that come with credit.
Younger Adult (25 to 35)—Once Thom and I got together we spent the first 10 years of our married life trying to get rich quick. It didn’t work. While we started and failed at several promising businesses and ventures, the one big thing we learned is that no matter how clever you think you are, chances are good that you can’t trick the world into making you rich.
Adult (36 to 44) —Eventually Thom and I began to realize that it was going to take more than our courage and cleverness to survive, let alone thrive. We needed to start developing professionally and perfecting our understanding of our field (mine was writing and Thom’s was commercial real estate.) But more importantly, we needed to dig deep within ourselves and understand our motivation and consciousness about money and our sense of self-worth.
Did it take 15 years? Yes. While our financial situation gradually began to turn around and improve through the years, not only did it take that long, but it is ongoing. Some of it was learning new ways to think about worth and money, and some of it was unlearning deep and limiting perceptions that both our family of origin and our culture had planted deep within us. And oh yes, we had to work to pay off all that credit-debt we had built up!
Middle-Aged Adult (45 to 60) —Once we began getting clear about our relationship with money on a deep level, we found ourselves taking a further step. At some point we began realizing that it wasn’t really money we wanted anyway. What we wanted was the freedom and ability to create experiences that brought us meaning and joy. Getting a nice big house, luxury cars and keeping up with all the other upper middle class people we knew just didn’t mean that much to us. Once we started right-sizing our lives, money became just a vehicle that allows us to live a SMART life with purpose.
The path to “right-sizing” is well documented on this blog so I won’t repeat those steps here. But once we began realizing that money wasn’t really the destination of our journey but merely a step on the path, everything seemed to switch. In case you’re wondering, things in our lives began to look very different. That led to:
- We redefined what success and happiness means to us alone and stopped listening to the media, other people or the culture about what makes for a good life.
- Stopped comparing our lives and what we had or didn’t have to anyone else.
- Eliminated all debt. Everything we own is free and clear.
- We right-sized our home to what we needed as a two-person family, reducing maintenance, insurance, and utility costs. We also went extremely energy efficient (solar, etc.) so that our utilities are less than $50/month all year long.
- Living below our means and eliminating debt gives us tremendous freedom and peace of mind. Most people have no idea how much time they spend worrying, thinking and planning about how to pay for all the stuff (and obligations) they think they need to be happy.
- Drastically curtailed buying stuff we didn’t need.
- Switched our focus to enjoying each other, people, experiences and Kloe rather than material items.
- Worked to eliminate fears about what the future will bring while consciously planning ahead for future experiences.
- Quit trying to hoard and accumulate stuff as a protective devise or an ego boost.
- Got clearer about work and activities that bring us the most joy and purpose.
Are we rich? I think so. But I’m well aware that my financial resources look much more modest than those in the top 1% of the world’s wealth. Still, I’m also aware that many of those in that exclusive club are more worried and frantic about their money than I am. How much do you need? That question can only be answered by you and it seldom has anything to do with an exact number.
In the end, the best way to be Money SMART is to realize that how you feel about yourself and your place in the world will determine how you feel about money. Is it is Sustainable? Meaningful? Aware? Responsible? Thankful? You decide. While I can’t tell you how to get rich, I think our experience can shows you how to be more SMART about your money. The rest is up to you.