Without Money, We'd All be Rich

Live a Rich Life Without a lot of Money

One of the most common questions I’m asked is:

It’s very difficult, if not impossible, financially for some people to do what you do. How do you do it?

Since I began writing Hundred Goals, I’ve tried to encourage people to live minimally, and within their means. Despite the subtle financial advice I offer, people still seem confused, and sometimes even offended, that I’m able to live the way that I do. I’ve actually been accused of being a drug dealer. For some reason, I just can’t seem to convince people that, financially, they can do exactly the same things I’m doing.

I’m not rich.

The truth is, I live on less than $20,000 a year. But despite my limited budget, I still manage to do a lot of amazing things. I’ve backpacked around Europe, learned how to surf in Hawaii, toured the White House, and watched the eruption of Eyjafjallajökull in Iceland. It’s not because I’m rich that I’m able to do these things. I’m able to do these things because I’ve taken the necessary steps to live within my financial means.

If you’re finding it financially challenging to live the life of your dreams, here’s my advice to you:

Eliminate all of your debt, and avoid incurring any new debt. If you’re always paying debts from your past, it’s impossible to live in the moment. Pay off your debts, and avoid any new debt. Live within your means.

Avoid buying shit you don’t need. Only spend money on things of value. The rest is just bullshit. Don’t waste your money.

Don’t pay attention to other people. What other people have, or where they go for vacation isn’t important. Know what you value, and stay focused on the goals that you’ve set for yourself. Don’t be distracted by other people.

You can’t have everything you want. You can have anything you want in life, but you can’t have everything. Whatever you want, you can have it. But having it will probably mean giving up something else. Sacrifice the things you don’t value so that you can have the things you do.

Make life a priority. If you want something, you can’t just expect it to happen. You have to make it happen.  Don’t sit around thinking about all of the things you want to do with your life. Do them! Stop thinking, and start doing.

It’s really that simple…but also easier said than done.

It takes a lot of dedication and determination to get out of debt. It’s a battle that must be fought EVERY.DAMN.DAY. And it isn’t easy to ignore what other people have, or what they’re doing. But instead of feeling jealous of them, be happy for them. Focus on your goals, and your dreams. Stop thinking about the life you’ll have someday, and start living the life you want today!

And stop buying stupid shit you don’t need. Seriously. Stop.

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The Life You’ve Always Wanted?

We all have our ideas of what the “perfect life” would be like but often the images in our mind are a far cry from the reality we are living.  If you were able to travel back in time and ask a younger version of yourself if this is the future they’d choose for themselves, what would their answer be?  Twenty years ago, could you have envisioned the life you have today?  Is it everything you’d imagined or have your dreams evaporated into thin air?

Chances are, the life you are living today is nothing like the life you expected to have.  You sold your ideals for a dollar bill.  Why?  “Because that’s just what adults do.” We have to make a living to pay the bills.  There’s food to buy and television to watch.  How are we supposed to save the world when we’re up to our eyeballs in debt?  The mortgage isn’t going to pay for itself, is it?

“It is what it is.” There’s no time for dreams.  Dreams don’t pay the bills or put food on the table.  Our younger selves didn’t understand what it meant to be adults.  We have obligations now and we’ve built our lives around some idea of what it means to be a “responsible adult” in today’s world.  What we ended up with is a career that steals our time and energy, a mortgage that drains our income and debt from all the Stuff we bought to furnish and decorate our home.  We have many thousands of dollars in Student Loans and a couple of cars to pay for.  Oh yeah, and the credit cards…

It looks like being an adult isn’t all that we’ve been led to believe.  All of our lives we’ve been told that adults are “responsible”, implying that it’s somehow more virtuous to fall in line and follow the leader than it is to follow our youthful ambitions.  The “responsible” thing to do is find a job, get married and have children, buy a house and a couple of cars, then keep your nose to the grindstone until it’s finally time to retire.  When that day does come, we hope that our health will last long enough to enjoy the life of our dreams; the life we’ve been waiting our whole life to live.

And what has it all amounted to?  A garage full of Stuff we never really needed in the first place, kids that seem to resent our very existence unless we’re buying them something, a spouse that we barely seem to know anymore and a huge house we aren’t able to enjoy because we are at the office earning a paycheck to pay the mortgage.

Sure, we have all the Stuff we could ever imagine.  We drive nice cars and wear nice clothes.  Our home is decorated like a magazine cover and on the weekends we are able to relax with a cold beer in the backyard.  On the surface things seem wonderful.  A little deeper though and things don’t look as good anymore.

What are we sacrificing to create this image of the “perfect” life?  Our time, our energy, our sanity?  If the average person starts working fresh out of college at the age of 22 and retires at 67, that’s 45 years of life sold for a dollar bill.  We’re trading our life to fill our garage with junk, for a heap of metal to take us to a job so that we can pay for that same heap of metal.

What if there were a different way?  What if you didn’t have to spend your entire life working?  Would you do it?  If you knew that in 10 years you could be financially able to walk away from your job with enough money to pay for all your expenses, would you have the ambition to make it happen?

There is a way, it is possible!  The only problem – of course there’s a problem – is that to get there, you have to minimize your spending and save.  “But that’s Un-American!” Our entire lives we’ve been told to “get out there and boost the economy.”  After the attacks on September 11 we were told to go shopping as a way to stand up against terrorism.  Does that mean we’re supporting terrorism by saving money?  Of course not!

What I’m talking about isn’t a new concept.  It isn’t impossible.  It’s been done before and it’ll be done again.  And not just by a few outliers but by many thousands of people.  Will you be one of them???

What’s the secret?

Live Frugally: Cut your expenses to the bone.  Anything that doesn’t offer real value to your life is out.  That might mean going without a contracted cell phone, cable television, TiVo or Netflix.  Find alternatives or other ways to occupy your time.  It may seem impossible now but you can live without these things.

Get Out of Debt: You can’t be financially independent when you’re in debt.  Get out, get out, get out! By adopting a frugal lifestyle, the extra money you’re able to save can be applied towards eliminating your debt.  After you’ve saved up enough money to cover six months of living expenses, every penny should be thrown at your debt.

Save: Once you’ve paid off the last of your debt it’s time to save like never before.  It may take you a few years, maybe even ten or 15, to save enough money to become financially independent but that’s better than 45 years!

Invest: This is where the magic is!  With the money you’ve saved, you can invest it into conservative investment vehicles which will pay you interest in fixed intervals over a specific length of time.  If you’ve saved and invested enough, this interest will cover all of your monthly expenses.  Now your money is working for you, not the other way around!

If you’d like to learn more about the process outlined above, I recommend checking out the book Your Money or Your Life by Vicki Robin and Joe Dominguez.

Waiting For Someday

Around the time I began writing Hundred Goals, I wanted to change my life.  I was working at a job that I hated to pay for a car that took me to that very job.  All three of my credit cards were maxed out and over their limits.  I had been dragging along a personal loan for almost 6 years, the result of multiple failed attempts at debt consolidation.  This, on top of my Student Loan debt that continued to grow with each semester.

I wanted to change my life and the first step had to be getting my financial situation under control.  Without making money my priority, accomplishing anything else, any personal goal, would either be impossible or lead me further into debt.  My only option was to dig myself out of debt, dollar by dollar.   For the next year I spent every moment of my life working.  I went in early and stayed late.  If I was able to work on the weekends, I did.  I worked every single day of the week, Sunday to Saturday, at times working more than three weeks without a single day off.

I was earning a lot of money and using every penny to pay off my debt.  I watched my account balances disappear and I began the long climb out of debt.  My credit cards were the first to be paid off, then the personal loan.  While I was working to get out of debt, my life consisted of nothing more than work.  Keeping the money flowing in was my sole mission and purpose in life.  I knew that my hard work and determination would eventually pay off.

After paying off my credit cards and personal loan, I felt like my financial situation was almost under control and I began working less hours.  Now that some of my debts were paid, I was no longer struggling to make ends meet.  The money I earned working 40 hours a week was more than enough to continue paying off debt and to begin pursuing some of my other ambitions, so…

Erin and I booked a trip to Aruba.

Even though I still had debt, a balance between delaying gratification and living in the moment needed to be struck.  Instead of waiting for the ideal financial moment, a moment that would be years in the future, I seized the opportunity to pursue my dream of world travel rather than continuing to delay my life.

Fiscal responsibility doesn’t mean a life of suffering and slavery to your debts.  It means finding a balance, one where you meet or exceed your financial obligations while still leading a fulfilling and meaningful life.  When I was working seven days a week, my life wasn’t fulfilling or meaningful but it was what I needed to do at the time in order to put my life in a place where I was able to find meaning and fulfillment.

I wanted to change my life and I have.  I no longer need to rely on my credit cards and I do not carry a balance from one month to the next.  I don’t need to rely on payday lenders to make my rent payment at the beginning of the month.  I have paid off the remaining balance on my car loan and have begun repaying my Student Loans.

All the while, I am chasing after my goals.  Since traveling to Aruba, I have spent the majority of my free time visiting places around the world.  Belize, Germany, Iceland (Mexico, Honduras, Grand Cayman).  I spent a month visiting National Parks around the United States.  I have paid for all of these things with cash from my pocket as I continue paying down my debts.  I’m not waiting for someday.

It could be argued that I could pay off the last of my remaining debt much earlier if I were to sacrifice even some of the traveling that I do.  Absolutely!  It would be possible to get out of debt earlier, though I see no reason to sacrifice the precious moments I have now in order to become debt free a little sooner.

“Accomplish Your Goals While Managing Your Finances”

It is possible to do both and I encourage you to find the balance you need in order to turn your dreams into a reality while meeting your financial obligations, not only in debt reduction but also in savings and planning for the future.  Waiting for someday to live your life is a sure way to waste the life you have at this very moment. 

Find balance.