Money Mentality and Financial Independence

. 3 min read

Every now and then I find new challenges and perspectives on my quest for financial independence. When at a time in my life where I can 'do what I want' (no family or obligations) it's very easy to get carried away.

Recently I've been considering my different mentalities towards money...

Time is Money

Because of the long term scope of FI/RE things can get complicated.

Familiar with chaos theory (small changes in initial contiditions leading to extreme differences in final conditions) I get stuck weighing how important my time is NOW. I'll give a specific example so we are on the same page: With Sipreme (or future foods in general) I am spending well above what I could be at my thriftiest. However in having such a quick meal I am able to get on with more important matters.

To make things complicated let's make those matters building this blog, studying or working a job. If I have more spare time to work on these things in the present then the future income or reward from doing so may outweigh the current cost!

Look at the example of a job: if you save x hours by spending z and earn y per hour then if xy > z you have yourself a bargain. But like I mentioned even if xy < z the additional time spent on the job my lead to larger earnings c in the future. Is xy + c > z?

Well c is an unknown and that makes things tricky. I know the maths is getting a bit out of hand but when you go further and consider how all these parameters are functions of time you can really start to see the dilemma. It is this unknown that compelled me to continue with future food, despite it being more expensive (and go further by researching into other time saving techniques such as polyphasic sleep).

However one thing about this mindset is that it caters (conveniently) to convenience. If you are willing to spend more in one case to save time how then can you be consistent when holding back on other things? Getting a cleaner would save time, so would buying a car. So where does it stop? It all depends on the unknown c.

The more I thought about it the more I realised there is a glaring problem with the time is money argument... It assumes that I actually use the time for these money making tasks. Which in the best of times is only half true.

Personally I could not justify the premium of these kinds of things if I don't already feel I'm squeezing every drop of time out of my life already. If I can earn exponentially more by dedicating the time to these things now then how is it I still find time to watch junk on YouTube? There is no point spending money to save time if that time is not used effectively.

Just Renting

Another thing I've noticed is how much more relaxed I've been when spending money on non-perishables. Whenever I wanted to experiment with my lifestyle, for example when I got rid of most (all?) of my wardrobe I was fearful of the money I was spending on the quality outfit to replace it all. Minimalism, financial independence, travelling light, all this stuff is about reducing stress and there I was getting stressed out!

However, after selling all my clothes and some electronics, it suddenly clicked that I had all this dormant money the whole time. And if I buy anything again I can just resell it when the time comes. It's this temporary mentality that helped me open up and improve my life by overcoming financial barriers I was fearful of. If something doesn't work out, no worries, at least you won't regret never trying.

The obvious problem with this is that you will usually sell at a loss. The point is that the financial investment isn't as high as you think, so with that in mind you can relax and make a better judgement of if something is 'worth it'.

Graeme Russell

I created this blog as a way to reach people about topics I care about: ethics, self-improvement, and lifestyle. I hope you can find something of value here.