I was reading Dale Carnegie’s How to Stop Worrying and Start Living, a great companion to his more widely read How to Win Friends and Influence People. Here are a few quotes from the book that resonated with me.
It’s amazing how, originally published in 1948, so much of what he wrote still rings true today 80 years later.
“What shall it profit a man if he gains the whole world—and loses his health?”
I often think about the connection between health, time, and money.
When you’re young, you trade time and health for money, because you have little or no money.
As you grow older, you have a bit of money and slightly less health but not much time as careers, kids, and other responsibilities fills your time.
Finally, in old age, if you’ve saved and invested wisely, you’ll have free time, plenty of money, but your health won’t be what it was when you were 20.
I also think about this quote when I’m in airport lounges and you see who I assume are successful businessmen, but they are grossly out of shape. How much of their life energy did they expend for more money they might not even need?
“The cost of a thing is the amount of what I call life, which is required to be exchanged for it immediately or in the long run.” – Henry David Thoreau
Especially early in life, it’s important to realize how much work and time is required to obtain things. If you make $60 per hour, a $5 latte costs 5 minutes of your life. A $15 book costs 15 minutes. A nice dinner out might be 3 or 4 hours, half a working day. Your weekly rent might be 10-15 hours of your life.
The book Your Money or Your Life by Vicki Robin and Joe Dominguez brings this point home even more clearly, as to get to work usually requires a commute, and there’s the time spent shopping for work clothes, and the time spent thinking about work outside of work hours, and so on.
The idea of a budget is not to wring all the joy out of life. The idea is to give us a sense of material security—which in many cases means emotional security and freedom from worry. “People who live on budgets,” Mrs. Stapleton told me, “are happier people.”
And let’s remember this: even if we owned the entire United States with a hog-tight fence around it, we could eat only three meals a day and sleep in only one bed at a time. To lessen financial worries, let’s try to follow these eleven rules:
1. Get the facts down on paper.
2. Get a tailor-made budget that really fits your needs
3. Learn how to spend wisely.
4. Don’t increase your headaches with your income.
5. Try to build credit, in the event you must borrow.
6. Protect yourself against illness, fire, and emergency expenses.
7. Do not have your life-insurance proceeds paid to your widow in cash.
8. Teach your children a responsible attitude towards money.
9. If necessary, make a little extra money off your kitchen stove.
10. Don’t gamble—ever.
11. If we can’t possibly improve our financial situation, let’s be good to ourselves and stop resenting what can’t be changed.
Lots of goodness in this list. A few comments on this list:
- Getting the facts down on paper and understanding our income and outgoing expenses is essential to building a financial plan.
- A tailored-made budget is fine, I prefer to do the savings and investing automatically and then spend the rest as required
- This is essential. Learn how to buy quality products that last a long time
- mo’ money, mo’ problems.
- Credit is fairly easy to get in New Zealand, the biggest issue I see is borrowing too much and buying too much house
- Insurance is essential to cover for catastrophic events, but you don’t want to over-insure and spend too much on insurance
- This is a good point, that sometimes it helps to have a trusted financial advisor managing the funds. Just watch your costs.
- Children will copy what they see you do. Make sure you’re communicating with them on an age appropriate level. Give them some freedom to make mistakes earlier on.
- The gig economy was alive 80 years as it is today. If you need to make some extra money, there are lots of opportunities for side hustles and side gigs
- Good idea, especially if you want to build wealth
- Reminds me of the Serenity Prayer: “God grant me the serenity To accept the things I cannot change; The courage to change the things I can; And the wisdom to know the difference.”