Defining Your Financial Future
For better or worse, language has a significant influences on who we are and what we do in life.
What, for example, is the definition of the word retirement? How has this shaped your life? More importantly, is this definition yours? Or is it shaped by conventional wisdom? If you haven’t formed your own concrete definition of retirement, which may be the largest single financial (and non-financial) pursuit of a lifetime, you’re unknowingly allowing the conventional meaning of retirement to shape your actions—to define your life.
“Man acts as though he were the shaper and master of language, while in fact language remains the master of man.” ~ Martin Heidegger
Many words and terms that define your life are abstract; they may be useful for quick and general communication, but these terms can be so general that they almost have no real meaning.
Words can also be dynamic; their meanings shift in meaning over time, especially on a personal level. For example, does rich mean the same to you today as it did when you were twelve years old?
Clinging to abstract, static, conventional meanings of words that potentially define your actions and your life can be perilous, if not extremely expensive, both in financial and non-financial terms. For this reason, it’s important to consciously define words for yourself and to periodically reshape the definitions, much the same as you would implement, monitor and evaluate your financial plans, as your life evolves.
Here are five words that shape your money and your life, followed by some questions to guide — but not force — your own thoughts and definitions.
Happiness
Are you seeking happiness? Is it something you find or does it find you? Can money buy happiness? What really makes you happy? Is it relationships with other people? Is it having or is it giving? For some added perspective, the root of happiness is hap which aligns with the meanings of other words like “chance” or “fortune.”
“Don’t seek happiness. If you seek it, you won’t find it, because seeking is the antithesis of happiness.” ~ Ekhart Tolle
If happiness is more of an occurrence or even a wonderful surprise, can it be self-created? If not, why do we pursue something that “happens?” How much money have you spent trying to catch happiness? What is the price of pursuing happiness? What might you gain if you stop pursuing it?
Rich
Does money make you rich? If so, how much does it take and how do you know you won’t keep increasing this amount once it is obtained? Is money a tool for your life or is your life a tool for money? Without a concrete definition of rich, might you just be chasing the proverbial carrot that is never reached? Do you feel trapped in the so-called rat race? If money does not make you rich, what does?
“To you, being rich might mean owning a goat farm in South Carolina. For your best friend, it might mean being able to start her own business selling wine over the Internet. Whatever the case, you’re probably not motivated by the money itself, but by what the money could let you be and do.” ~ J.D. Roth, Your Money: The Missing Manual
Which is the wiser pursuit, to get rich quickly or to get rich slowly? It depends upon your definition of rich! Is rich a state of financial well-being or is it a state of contentment and overall well-being?
Freedom
This word receives some of its greatest abuse and deception in the term financial freedom. Does money buy freedom? Are there any financially poor people who are free? Are there any financially wealthy people who are not free?
Defining this word may be as difficult and futile an effort as defining truth; however you may be served well to at least frame freedom in a similar way as did 20th century philosopher, Erich Fromm. He divided freedom into freedom from and freedom to:
- Freedom from, according to Fromm, is negative freedom and it is based in fear because it is sought as relief from uncertainty or from restrictions placed on an individual by society (e.g. other people, government, financial creditors). Seeking freedom from can paradoxically reduce or remove one’s actual freedom.
- Freedom to is the healthy form of freedom because it is the form where the individual obtains the capacity to be creative, to act as the authentic self. When one obtains the means to be creative and authentic, they are enabled to reach the highest form of productivity because their actions are purposeful and meaningful; therefore, the individual is content by acting as the authentic self.
“…freedom to create and construct, to wonder and to venture. Such freedom requires that the individual be active and responsible, not a slave or a well-fed cog in the machine…” ~ Erich Fromm
Success
What does success look like? Is it a state of being? Is it simply reaching a goal? If you don’t reach the goal, is it failure? Why or why not? Do you associate success with the acquisition of money, material wealth or social status?
“Don’t aim at success. The more you aim at it and make it a target, the more you will miss it. For success, like happiness, can not be pursued; and it only does so as the unintended side-effect of one’s dedication to a cause greater than oneself or as the by-product of one’s surrender to a person other than oneself. Happiness must happen and the same holds for success: you have to let it happen by not caring about it. I want you to listen to what your conscience commands you to do and go on to carry it out to the best of your knowledge. Then you will live to see—in the long run, I say!—success will follow you precisely because you had forgotten to think of it.” ~ Viktor Frankl
If, like happiness, success is not a creation but a natural occurrence, should you be pursuing it?
Retirement
What is retirement? Is it a destination or a journey? What thought or vision does the word evoke? Is it financial status? Does one have to be in their sixties, debt-free, and have a nest egg large enough to generate 80% of pre-retirement income at a 4% annual withdrawal rate to be retired? Why or why not?
“Money often costs too much.” ~ Ralph Waldo Emerson
Can you see how such a large potential cost of time, money, career decisions and other life sacrifices is associated with retirement? If money is only one of the many tools to help accomplish your definition of retirement, how much money do you really need to be retired? Could you already be retired now?
Words to the Wise
All of these words are useful because of their abstract nature — they have a general, universal meaning so they are easily understood for purposes of mass communication. Be careful, though, not to allow words and terms to lead you down the paved road of social conventions. To lead a life of meaning and purpose, you must create your own path; define words and terms for yourself. There is no wrong way to attach your own meanings to words, except to ignore doing it all.
“All truly wise thoughts have been thought already thousands of times; but to make them truly ours, we must think them over again honestly, till they take root in our personal experience.” ~ Johann Wolfgang von Goethe
What do you think? What words do you believe must be defined by and for yourself? What conventional, abstract words do you believe have the potential to mislead? Are some of the words featured today better left without concrete definitions?
Become A Money Boss And Join 15,000 Others
Subscribe to the GRS Insider (FREE) and we’ll give you a copy of the Money Boss Manifesto (also FREE)
There are 34 comments to "Defining Your Financial Future".
I think being rich, and having freedom are the two words that differ the most among people I know. For many of my friends, freedom is simply having that coveted week long vacation in the summer, and being rich is being able to buy the latest gadget. That mindset really is very limiting and to me, is not being rich or being free at all. I think the heart of the matter is being content, and having joy in your life. If you are able to find joy and contentment, you will lead a rich and free life.
Chomsky > Sapir-Whorf, Heidegger notwithstanding. Orwell’s newspeak isn’t really possible. Linguistic relativism has been largely discredited by modern science. Not to say that questioning conventional notions isn’t a good thing, it’s just that language doesn’t have the power to cage our minds.
in my opinion, if you can call up the Sapir-Whorf hypothesis, then you know the formal answers to these questions.
Despite that, thinking through the answers can lead to a more fulfilled life. The formal answer doesn’t necessitate the informal.
“Freedom from” vs. “Freedom to”. I like this idea. When I think of being financially free I suppose I’m usually thinking of the former, which entails having lots of money so that I am not beholden to some company or person and therefore have choices in my pursuits. However, one can choose from among many options, regardless of finances. I am “free to” choose many options even if I haven’t met all of my financial goals. It may be related to J.D.s notion that the perfect is the enemy of the good.
Suzanne:
Yes, drawing a distinction between “freedom from” and “freedom to” is crucial to making a distinction between money and life.
Many people spend their lives seeking “freedom from” something, such as financial debt; yet they never really clarify what they will do once they obtain this freedom.
I like to tell readers and clients that life is not a tool for money; money is a tool for life. “Freedom to” frames the idea of making money a tool for life.
I’m definitely looking for both freedom from creditors, work I hate etc and freedom to pursue my interests. I have the former, but I’m still building my nest egg for the latter. I think it’s difficult to claim you’re free if you still depend on working for someone else to supply your basic needs.
I have to disagree with not pursuing happiness. Part of being happy is figuring out what does and doesn’t make you happy. Gretchen Rubin has a whole blog and book dedicated to pursuing happiness and makes a strong case for being proactive about it.
Gretchen Rubin’s book and blog are both outstanding.
I’ve never read Gretchen Rubin’s book but I’ve read her blog a few times. I noticed that she has quoted Aristotle and used some of his ideas of happiness.
Truth be told, today’s meaning of happiness is not the same as it was in Aristotle’s time. The ancient Greek’s word for happiness was “eudaimonia,” which has a closer translation to “contentment” or “flourishing” or “well-being.”
Today, the meaning of happiness is closer to the word “pleasure;” happiness today is often the result of obtaining a reward that can be easily consumed — it is fleeting.
Personally, I prefer the way Daniel Goleman, author of Emotional Intelligence, frames it:
“There is a difference between what is called a ‘State Effect’ and a ‘Trait Effect’ as it’s called in psychology. You experience a State Effect when you go to a workshop — you feel great, that was so good! But there is a shelf life to that. By the next week, life has set in again. You’re stressed about your job, your dog is sick, and you are arguing with your partner. That is the State Effect — it’s great while you are in the circumstance, but alas, it doesn’t last. The Trait Effect, on the other hand, means that you have embarked on a program of training the mind and training the heart in a systematic and prolonged way, which actually changes the neurology of your brain. And the more you do it, the bigger the change, and it will be there a year later, maybe even 10 years later.”
Wow, thanks JD for this guest post from Kent Thune. With the recent Prudential Survey indicating 44% of Americans have decided to not invest in the stock market, advice like this guest post is very needed.
Money is not your life, or at least it shouldn’t be, but it is the means to the life YOU want! Kent’s very thoughtful and thought-provoking post sums this up very well:
“Is money a tool for your life or is your life a tool for your money?”
El Nerdo’s point above is valid, but I think words reflect our thoughts and can indicate our challenges. As an example, count the number of times you say “try”. A high number may indicate you don’t believe you can do whatever you are referring to when you say “try”. As Master Yoda, granted a fictional character, said: “There is no try. There is only do.”
I’m redoing my blog and blogroll and plan to feature Get Rich Slowly. I’ll also feature The Financial Philosopher!
Thanks for bringing attention to blogs like The Financial Philosopher.
Best regards, Paul
Nice feature – allowing subscriptions to comments with no comment required!
I like the word “try.” I’m sure sometimes using that word leads people to not trying as hard as they otherwise would. But if I had to say “do” all the time, that would limit me. It’s okay to try and fail at things. When we don’t know which ones we’ll fail at and which we’ll succeed at and which we’ll semi-succeed at, it’s good to try lots of the good ideas, just in case.
Great point, Debbie. I believe you and Paul would both agree that trying and doing are both actions!
If you never try, you will never do. I agree with Debbie’s comment, particularly, “It’s okay to try and fail at things.” Thankfully, it is, otherwise we would all be something other than OK!
This is such a perfectly timed post for me, as I’m currently at a split path and not sure which is best. I’ll be defining these words in my own terms in order to help me decide what to do.
Love the Emerson quote – “Money often costs too much.” It’s amazing how long it takes some people to figure this out. It’s even more amazing the number so self-deluded that they never do.
The “how much is rich” question is where we are right now – we finally reached agreement on a cap for the emergency fund, so we can divert some of the cash flow we were using to build that up to something else. I think we’ll have the same problem with “retirement” in the future.
Since the future is unknown, if money means safety or success to you, there’s no end to accumulation unless you get your rational mind to set one.
Good point Rosa:
If you never have “enough” you will never be rich, no matter what level of financial wealth you may acquire.
I wonder if Thune knows that his last name is French slang for “money”.
Ha! Ha! I’ve never heard that before. I can rest easily knowing that my last name, Thune, is Norwegian and the meaning comes from a type of fish (My family immigrated to the U.S. from Norway approximately 120 years ago).
Perhaps I could align myself with the fisherman’s parable: http://www.thefinancialphilosopher.com/2010/06/the-fishermans-parable.html
Words and names have different translations in different countries.
It’s important to stop and think about what really matters before making too many decisions. Words are a good place to start.
The word “retirement” has always had a very negative connotation for me, I’m not sure why. I don’t know of anyone in my family that’s ever retired (they die early or are too poor to stop working). I don’t think about “retirement” per se, I just tell myself I’m setting aside money for later.
Because we’re discarding the “conventional” definitions of words, I have interpreted this post with my own meanings. I don’t see why GRS is an appropriate place to post a confession to the murder of Jimmy Hoffa, though.
For others who are making up their own definitions of words instead of relying on the ones that other people will know, and can therefore actually be used to communicate:
Monkey orange run flower fall in kick lovely donkey trip sky.
It means whatever you want it to mean, apparently.
Because a word like “happiness” describes an abstract concept does not mean you get to make up your own definition of “happiness” — it has a definition, it’s just that it’s an abstract one. The word “bird” describes a wide, abstract class of animals. This doesn’t mean you get to choose your own definition of “bird” and decide it means “parakeet”, just because that’s your favorite bird. The definition of the word still applies to *all* birds. Because this word is general does not mean it has “no real meaning”. Consider the following examples:
I have a thing.
I have an animal.
I have a bird.
I have a parakeet.
The sentence with “bird” in it has more specific meaning than the first two, and less than the last sentence. This means it has distinctly more meaning than “none”.
Yes, you choose your retirement like you choose a vacation, but “vacation” isn’t re-defined to mean “European bus tour” just because that’s what you choose.
The “conventional” definition of retirement *leaves the details unspecified* it does not force you to move to Florida and take up golf.
I understand this post is supposed to be about making conscious choices, but I just can’t get past the fact that it’s framed in the context of choosing new definitions of words to make that happen, which is ridiculous.
Sigh. I just love it when Tyler weighs in.
“When I use a word,” Humpty Dumpty said, in a rather a scornful tone, “it means just what I choose it to mean–neither more nor less.”
“The question is,” said Alice, “whether you can make words mean so many different things.”
“The question is,” said Humpty Dumpty, “which is to be master that’s all.”
Without going into Humpty Dumpty’s extremes, words don’t have absolute definitions; definitions are socially constructed and change with usage. Dictionaries are repositories of current accepted usage around the time of their printing, not permanent declarations of meaning. Furthermore, definitions are just made up of other definitions, so where does it all begin?
You realize also there is a difference between the dictionary definition of a word and its meaning in the individual mind, which does not negate the possibility of communication, though it makes it difficult (isn’t it always difficult?), and it allows language to mutate and evolve according to social usage, which is why old people talk funny and young people speak unintelligibly, or so do they mutually accuse each other of doing.
The problem with the article is that it gets mired in linguistics and opens a huge can of worms instead of directly addressing the need for the individual to examine received notions of what life should be. It doesn’t really need to be more complicated than that. Of course there’s always a need for a fresh approach, but here the opening is so subject to debate that it is difficult to arrive at the conclusion, but if you read with tact you’ll see Kent makes some valid points.
I was also confused by the references to the murder of Jimmy Hoffa.
Tyler:
You summed up my post quite well (although I suspect unintentionally) with your words:
“I understand this post is supposed to be about making conscious choices, but I just can’t get past the fact that it’s framed in the context of choosing new definitions of words to make that happen, which is ridiculous.”
You are correct: The post is about making conscious choices. It’s also about having a healthy perspective.
I respect your conscious choice to describe some of the ideas in the post as “ridiculous” but the primary idea is not to completely change the meanings of abstract words but to make them concrete for personal application. There is a difference.
Also, how “ridiculous” is it for a person to form their own concrete definition of retirement? I think it’s more ridiculous to blindly follow herd mentality and conventional meanings for something so personal.
In fact, I would love to see people follow your own example: Your transition of the abstract word “bird” to the word “parakeet” is useful. I believe people should do the same for the abstract words, such as retirement, that shape their lives.
At a minimum, people should make conscious choices. If they want to save and sacrifice for two-thirds of their lives for a “bird,” because social conventions teach this, go ahead and do it.
I’ll be in the minority that chooses “parakeet.” In fact, I might even change it to a “bird cage with an open door” so both the bird and I can be free.
I guess I’m sort of coming from the opposite perspective. I was always taught and believed that money can’t buy happiness. It can’t. I know that. However, I’ve lived many years below the poverty line and I’ve lived a few years above it and, all other things being equal, I’m much, much happier above it than I was below it.
I do not truly care about being rich. I do want to be secure. When my husband and I retire, I would like to be able to afford basic living expenses and medication without having to be a Walmart greeter. I like my husband and it’s taking so much of our time just staying above water that I hope we will be able to hang out together when we are older. I want to be able to visit my hypothetical future grandkids and take them on the occasional day trip, etc.
My values and goals are pretty darn well-defined. I have a lot more trouble with how to get there from here than I do with where I want to go.
Yep, it’s a sign of (perhaps modest) luxury that one can sit around wondering what words mean and defining happiness.
Not that I’m saying it’s bad. Leisure is the basis for culture, and all. Just that there are an awful lot of people who are just getting through the day.
I loved the post.
I think of “retirement” the same way kids think of growing up–it’s that magical time when we finally get to do whatever we want.
Now by the time you’re a grown-up, you’ve generally been brainwashed into either wanting to do the things your parents have been telling you to do or at least brainwashed into doing those things anyway. Nevertheless, I’m very glad to be a grown-up because, although my parents were awesome and I had lots of freedom, I do greatly enjoy the added freedom of setting my own priorities and having more of my own resources and abilities.
With retirement, that freedom will extend to the other eight hours a day. Yes, I’ll still have to live within my means, within my capabilities, and within the laws of physics, biology, and society. But it’s still a thing I want.
Incidentally I posted on similar topic on my blog. I talked about 4 poly morphs of being rich; Monetarily, Socially, Emotionally and Spiritually.
your attending to richness depends on how much of what poly morphs you aspire for.
“Progress” is the word I find people have the most trouble with, especially me. Everybody has a different idea of progress. For people that only define it as a global thing, then they miss the personal journey that we all have. Progress to all and have a great summer!
Thanks to J.D. for another guest post opportunity and to the readers for your comments that extend beyond the post.
One can read almost any GRS post and see in the comments that readers have differing perspectives of the world, especially with personal finance. This post does not suggest one should create all new meanings of words but rather to be careful of following in the path of social conventions — to create one’s own path by making abstract words, such as retirement, more meaningful and concrete for the individual — to find one’s own meaning and purpose in life, rather than falling in line with herd behavior.
I will not assume anyone is interested in my ideas or philosophies of life and money but the underlying themes are self-awareness and authenticity. In different words, I urge readers to make conscious choices and to be, know and act as their authentic self. This is where true wealth resides (at least in my definition)!
Please continue with the comments. I’ll add a few more of my thoughts tomorrow (I just returned from a vacation with my family).
Cheers…
Thank you Kent Thune.
I think you are positioned exactly where you should be, outside the box. You are looking in and watching the challenge for individuals hit by words. These come from well meaning friends,family,and sometimes, strangers trying to manipulate our lives.
Some of us are taking the “path less traveled” and receiving great and unexpected fulfillment.
great post – good food for thought, thanks Kent and JD