Learning to use money as a tool

It's pretty clear by now that I have a different relationship with money than when I started Get Rich Slowly. I'm by no means perfect with the stuff, but I've become firmly entrenched in the camp that sees money as a tool. (I used to see it only as a means to instant gratification.)

Here's a tiny example.

Taking a page out of Trent's book, Kris has been on a crock pot kick lately. This morning she tried a new swiss steak recipe. “Can you do me a favor?” she asked before leaving for work. “Can you make some mashed potatoes to go with dinner?”

“Of course!” I said. I make awesome mashed potatoes.

Well, as the day progressed, I became less enthused about the whole potato mashing process. As you might guess, it had something to do with The Book. Though I finished the manuscript last Friday, that's not the end of the work. In fact, I've been buried in editing ever since.

This morning, I started editing the chapter on housing. I expected it take only four hours. Instead, it took seven. Next I rushed to start editing the chapter on taxes and insurance, but discovered it's packed with problems that need to be fixed. I turned instead to the chapter on debt. More problems.

“I don't have time to mash potatoes,” I thought. “I have to edit.”

And though I know this sounds strange, it was then that I had an epiphany. All these months and years, I've written about the notion of Money as a Tool, and I've sort of understood it intellectually. But it wasn't until this moment that I actually knew what the concept meant: It meant I was stopping by the supermarket to pick up some mashed potatoes!

Money as a Tool

It's difficult to describe the relationship I used to have with money. It seemed like the ultimate objective. It was what I wanted. Yet I didn't do anything to earn or save the stuff. Instead, I'd spend it without thinking. When I spent more than I could afford to buy comics and videogames, I got a little thrill. It felt like I was somehow cheating the system.

I know now that the only one I was cheating was me. It took me years to pay off the debt I racked up by “cheating”. Now I really do see money as a tool. Monetary wealth isn't the goal. Happiness is the goal. Doing the things that make life meaningful for me — reading, writing, spending time with friends — is the goal. Money is useful because it can help me do these things. Used wisely:

  • Money buys time. I think we all understand this abstractly. Sometimes, as in the silly case of my mashed potatoes, money almost literally buys time, but it's usually more subtle than this. When I think of my retirement savings, I think that every dollar buys me a certain amount of future time with which I can do as I wish.
  • Money helps you meet your goals. It helps you do the things that need to get done. To use another example from my book-writing process, I've paid to buy books and journal articles to support my research. As I begin to focus on fitness, there's no question that money helps me better pursue my objectives. If I don't spend on Stuff and nonsense, I can use money to pursue my priorities.
  • Money makes life easier. This one's obvious I suppose, but you can use money to take away some of the drudgery in life. You own a car so you don't have to walk or ride the bus. You might pay the neighbor kid to mow the lawn. Or, in my case, I rent office space so I can have a “fortress of solitude” in which to write.

For me, the transition from using money for instant gratification to using it for bigger purposes has been a slow one. It took a long time to even realize how stupid I was being. After I became financially self-aware, it took a few years more to break my old habits, though I finally seem to be gaining some degree of self-control. (As I mentioned last week, I haven't used money to buy anything on impulse yet in 2010. That amazes me.)

And I've reached a place in my life where I can buy mashed potatoes from the grocery store and not feel an ounce of guilt because I know I'm practicing conscious spending.

$8 Per Hour

Normally, I think of supermarket mashed potatoes as a sort of rip-off. For $3.99, you get a pound-and-a-half of mediocre spuds. For four bucks, I could make twenty pounds of home-made mashed potatoes that taste much, much better. But was that $3.99 a rip-off today? Hell no! It was a bargain. That $3.99 bought me an extra 30 minutes to work on Your Money: The Missing Manual. To me, that's cheap.

Of course, there's just one problem: I didn't actually use that 30 minutes to work on The Book. I used it to write this blog post instead. Ah well. Sometimes the things you build with your tools don't turn out the way you'd planned…

Postscript: Kris and I have eaten dinner now. Her verdict? “These mashed potatoes are tasty,” she told me. (For the record, I was unimpressed.)

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Beth @ Smart Family Tips
Beth @ Smart Family Tips
10 years ago

We’re starting to grasp the concept of money as a tool. In the past we’ve always looked at ways we could save money by doing things ourselves. I’m starting to see now that if we’ve planned properly for certain expenses, sometimes it just isn’t worth our time and effort to do some things ourselves. For example, last week our kitchen sink backed up. After working on it a bit, my husband was certain the block was in the pipes underneath the house somewhere. Fixing it would require a larger snake than the one he has. It would also require crawling… Read more »

Georgette
Georgette
10 years ago

Wow, I read and learn from each blog post, but this one really hit the spot today! Too much to think about so I’ll keep this comment short…

olga
olga
10 years ago

The post is good and all, but common, for the time you drove/walked to the supermarket, crossed the alley where the mashed potatoes are, stood in line to pay (even with nobody else), got back home – you could have made mashed potatoes yourself, and be impressed with them! Even if the drive was on the way home, it is still a stop. 20 minutes, I would guess, all together? It is exactly how long it takes me to make mashed potatoes, from scratch, peel, boil and mash. For the recipe, add an egg besides milk and butter – it… Read more »

Kent @ The Financial Philosopher
Kent @ The Financial Philosopher
10 years ago

J.D., It’s quite a pleasure seeing you evolve into the philosophical side of money, which is no different than the philosophical perspective of life itself. I like to ask clients (and readers) to ask themselves, “Is money a tool for my life or is my life a tool for money?” Given honest and complete introspection, most people come to the realization that their life, thus far, has been a tool for money. This is the “epiphany” that you speak of. “Money is only a tool. It will take you wherever you wish, but it will not replace you as the… Read more »

virginia @ where you hang your hat
virginia @ where you hang your hat
10 years ago

I am just now figuring this out, too. I’m so used to only purchasing really important things and trying to save money on everything else that I sometimes forget to buy those little things that make my life so much easier. Like a hand and nail brush to keep my makeup from getting all over my white towels and an apple corer that really is the difference between me eating an apple and not bothering.

Shannon
Shannon
10 years ago

Just so you know this is a VERY slippery slope. One minute you’re buying mashed potatoes b/c you’re too busy to make them, and then you have a maid come clean your house b/c your’re too busy. You’ve got to be very careful about this..

Riva
Riva
10 years ago

Hi JD!

This is exactly the argument I made in the essay I wrote for GRS. I can’t wait to see it up!

Congrats on learning to use money as a tool.

~ Riva Soucie

friend
friend
10 years ago

Hi J.D.,

In real life, I am an editor, and I charge my clients $35 to $45 an hour. So buying the mashed potatoes was probably a better deal for you than hiring an editor.

That said, how can you edit your own manuscript? How can you see your own mistakes? Fresh eyes help. Hope someone at your publisher is going to give your masterwork more than a glance!

Eivind Kjørstad
Eivind Kjørstad
10 years ago

That’s one way to use the tool. Here’s another you might not have considered. Presumably, there’s some things you’d rather NOT have happening. Rain ? High fuel-prices ? Falling-dollar-value ? You can use money to buy INSURANCE against such things, not from a insurance-company (that’s a losing gamble), but by investing in things that take ADVANTAGE of the thing that HURTS you. For example, if higher fuel-prices would be a problem for you, buy stock in a company that would benefit from it, such as a oil-company. And rain ? Buy stock in a hydroelectric powerplant. Sure, it’ll still be… Read more »

Holly
Holly
10 years ago

Funny, J.D.

I thought you were going to write that since you’ve learned that money is a tool and because of your ‘new-found’ respect for money, you told yourself to take a (much-needed) 30 minute break, turn on the stove, and whip up your much-loved potatoes!

Nate
Nate
10 years ago

I totally get this moment you had JD — been there! What you did was a VERY smart and healthy decision. However, I HOPE that you didn’t sit there during dinner and obsess about your purchase (thinking about how you could have saved that money if you had only done it yourself…….). Honestly, those were the kinds of thoughts running through my head the first time I actually started letting myself use money as a tool like you describe. Ughhh — you have to just ignore the nagging thoughts! I STILL have uneasy thought about the $75 dinner my wife… Read more »

J.D.
J.D.
10 years ago

Olga (#3) I didn’t go out of my way to buy the potatoes, otherwise it would have been a waste. I needed to stop in at the market to buy milk, bread, and a few other small things. There was no additional time/transportation overhead involved. @Kent (#4) That Ayn Rand quote was the one I’d decided to open my book with, but my editor pointed out that many folks have strong negative reactions to her, so we pulled it. @Nate (#11) No worries. I didn’t obsess over whether it was a smart move. I knew as soon as I made… Read more »

James | Tech for the Masses
James | Tech for the Masses
10 years ago

1 Word: Slacker

Just kidding. Good job! Though I’m with you – homemade spuds are a million times better.

– James

HollyP
HollyP
10 years ago

I can fully relate to this. With 2 well-paying full-time jobs and 2 kids, my husband and I use more of our money as a tool to buy family time. I’m slowly becoming more relaxed about either buying pre-cooked food or going out for dinner a couple of times a week. It still hurts to splurge, but I enjoy spending that extra half-hour in the evening playing with my children. It is a priceless experience, and worth the extra $10-20/week (yes, $550 to $1100 per year) we spend.

Jackie
Jackie
10 years ago

I’m happy to hear that you came through with mashed potatoes despite your workload. There are definitely times when it’s worth it to pay someone else to do things for you so that you can do something else for yourself during that same time period. It’s funny how sometimes the littlest thing (like some mashed potatoes) can bring about big insights. Money is a tool that can be used in so many beneficial ways.

LM@Wealth Steps
10 years ago

Its almost a catch 22…the more money you make the more you need to “outsource” things you no longer can do and then you need to make more money to keep on paying for all those services…

Kent @ The Financial Philosopher
Kent @ The Financial Philosopher
10 years ago

J.D. I completely understand your publisher wanting to pull the Ayn Rand quote but (as you might think in your own mind) I disagree with the reasoning in the decision. Rand was a brilliant thinker, as was other “controversial” figures, such as Friederich Nietzsche. Personally, I include diverse thought in my writing just as I would include diverse holdings in an investment portfolio. I’ll quote Jesus Christ right next to Ayn Rand — not to make an ideological or religious point, but because they both had something valuable to share about life and meaning… “In the case of any person… Read more »

olga
olga
10 years ago

Point taken, thanks. Then it’s all good:) I bought pre-made meatballs last night when I HAD to stop anyway for milk, otherwise I usually make those from scratch as well:) I am frugal, but not stubborn (well, not too much anyway), because I knew today I’ll need some time to rest for tomorrow’s 30M run and wouln’t want to spend it making meatballs for family dinner.

Crystal
Crystal
10 years ago

Glad you bought yourself a little more time. Even if you only bought yourself time to write a good post, we appreciate it and you needed a small break anyway to keep yourself fresh. This comment really made me smile, “VERY slippery slope…then you have a maid…” I don’t think store bought mashed potatoes are really a gateway convenience into getting a maid. 🙂 P.S. I love my maid and believe she’s totally worth $45 biweekly. I would not suggest splurging unless you already have a tight reign on your spending habits, but I do suggest spending money on what… Read more »

Meg
Meg
10 years ago

I think #16 is right. It’s like “More money, more problems.” Maybe someone gets a higher-paying job, but it’s more demanding – more time is spent traveling to clients, or at the office, so there is less time for cooking and spending time with the family.

I think that with using money as a tool, one needs to learn that one can’t have their cake and eat it, too – if you want something, something else has to be given up.

Mrs. Money
Mrs. Money
10 years ago

I think that’s the beauty of life is that we’re always learning, always changing, and always adapting. It’s funny how one day we can be appalled by $3.99 and another be pleasantly pleased!

Caitlin
Caitlin
10 years ago

I love how you can “know” something for years, and then something happens to really drive the point home and you suddenly get it more than ever before. ^_^ @Shannon – there’s nothing inherently wrong with that. If money is merely a tool, and we should be using it for things that bring up happiness, then for some people it stands to reason that paying someone else to clean their house is worth more to them (in time spent with the family instead of dust bunnies, in happiness, etc.) than the dollar value of hiring the cleaner. It’s when we… Read more »

Nicole
Nicole
10 years ago

Heh… That’s two important lessons that I seem to live daily: 1. Editing generally takes longer than I think it will. 2. Time is often more valuable than money (which can be exchanged for goods and services, thus saving time). Man, I’m always behind on writing. I know several women in my field who have a personal assistant hired either part-time or full- to help take care of all the little things. It’s worth it! When your comparative advantage is something that makes money and is not putting the cordless phone back on the base, and you want to spend… Read more »

Dianne
Dianne
10 years ago

I am trying to get my adult kids to realize the above mentioned ideas. They were never raised to have instant grats by any means. Both say they are doing fine but I know their paycheck day symbolizes “go”!
and…my husband always makes his own mashed potatoes. They just tast so much better! He has it down to a science…peel and cut…place in the pan of water…rest while watching tv…cook and mash. Am I the only one in this family who saves, saves, saves? Thank God I’m here!

John Steed
John Steed
10 years ago

JD

A terrific example of “spending money with purpose” (my description of “conscious spending”) so that you can focus on your priorities and improve your quality of life. And guilt-free, too – another benefit of getting to the “third stage” of personal finance, where you have a bit more freedom to indulge in discretionary spending.

Good luck with the editing on your book.

BJ

Funny about Money
Funny about Money
10 years ago

Nice post, JD…you have such a gift for writing! This is sort of what I’ve thought, myself: sometimes it’s worth paying a little extra to free yourself up to do something more productive: a task that’s worth more in the cash it returns or in the living time enjoyed. On the other hand, because of my innate laziness I tend to take the philosophy to extremes. It’s very easy to slide into thinking that I should buy xxx convenience or pay for yyy service because it’s going to save time to do some more valuable activity, when the fact is… Read more »

kaitlyn
kaitlyn
10 years ago

JD,

I’m glad you listened to your editor about pulling the Ayn Rand quote. I know many people (myself included if it weren’t your book) who would pick up your book, see a Rand quote opening it, and immediately put it back down and walk away.

On topic, I’ve always been a fan of considering the equivalent dollars per hour of something. If I’m working a lot of overtime, my need to rest is more valuable than whatever I spend to buy a pre-made dinner.

J.D.
J.D.
10 years ago

@Nicole (#24)
The first quote in the book is now:

“What we get from this adventure is just sheer joy. And joy is, after all, the end of life. We do not live to eat and make money. We eat and make money to be able to live. That is what life means and what life is for.” –George Mallory

I think I may actually like this better than the Rand quote. 🙂

Nicole
Nicole
10 years ago

I like it! What a wonderful focus on the end goal. It isn’t about forcing money into structures like the Rand quote, but about growing happiness. This quote conjures visions of warmth and sunlight, not work and steel.

Though I have to admit, some days I live to eat. If people don’t, maybe they’re not doing it right. 😉

Kent @ The Financial Philosopher
Kent @ The Financial Philosopher
10 years ago

@ Kaitlyn #27 & J.D: Not to get too far off topic, but on the subject of editing, Ayn Rand, controversial thinkers, and how all of the above pertain to selling books, I would also likely refrain from opening a book with a figure with controversial philosophies, but only because an opening is a statement in itself. I would reserve the more challenging and controversial thoughts, if needed, for later chapters. With that said, however, it sure is disappointing that a person comfortable and confident in their values and beliefs would turn away from a book after reading one sentence… Read more »

Lucy
Lucy
10 years ago

Try the oreida steam and mash potatoes. The are a great time saver and taste great!

E
E
10 years ago

@JD #28 – LOVE IT!!! 😀

Naomi
Naomi
10 years ago

I have to admit, this is the exact opposite of what I expected. Isn’t buying prepared mashed potatoes the very definition of instant gratification?

kaitlyn
kaitlyn
10 years ago

@kent 29, I’m all for exposing yourself to things you disagree with. I’m an atheist who has read the Bible cover to cover. The difference is I know about Ayn Rand, and I strongly disagree with that philosophy. The opening quotation is something that sets the tone for the whole book. If the opening quotation of a self-help book comes from someone I disagree with, then I’m not going to feel like I will get the right help from that book. It would be like opening a science textbook that begins with a quote from a young earth creationist. I’ll… Read more »

valletta
valletta
10 years ago

My dad used to say “Do you want to be right or do you want to be happy?”
I use this as it applies to everything in my life, especially money and my marriage 🙂

LeanLifeCoach
LeanLifeCoach
10 years ago

Like any tool, it can be used for or against.

If you are in debt up to your eye-balls the cost is much greater than if you idle cash and no debt.

EscapeVelocity
EscapeVelocity
10 years ago

There are definitely times for shortcuts, but I think trading money for time can lead to thinking “I am an Important Person, so I need to have Unimportant People doing all the Unimportant Work in my life so I can do Important Things,” which is not really true for most of us and can lead to a lot of stress on a relationship if it turns out that one of the Unimportant People is one’s spouse.

Craig
Craig
10 years ago

Money is a tool as a means to do other things in life that you want to do. It should be looked at that way, and you should enjoy your life accordingly.

Charlotte
Charlotte
10 years ago

JD,

Unfortunately in this case, money bought time but not quality. I totally hear you though – sometimes, you have to be a satisficer, not a perfectionist.

Although, if you had bought the mashed potatoes from Whole Foods Market, New Seasons Market, or similar place, you will likely get good quality. Maybe not as good as your recipe but close.

How about you post your recipce for mashed potatoes? Just the ingredient list.

Little House
Little House
10 years ago

I like how you outlined the important things that money can do for people, but ultimately it’s happiness that’s important. I’m really curious about your chapter on housing. I can’t wait to hear that your book is ready to be purchased. It sounds like you’re laying it out so that people like me, who are short on time, can skip around to the chapters that are most pertinent to my situation.

Foxie || CarsxGirl
Foxie || CarsxGirl
10 years ago

This is some great stuff here. 😀 I love it! I always try to remember…. “I don’t need to be rich, I just want to be happy.”

Anonymous
Anonymous
10 years ago

Here is a tip on mashed potatoes. Cut potatoes in half and toss in a crock pot with vegetable or chicken broth. Let cook for 4-6 hours and whip up with a mixer. Total hands on time is less than 10 minutes.

Liz
Liz
10 years ago

Great post – it is what I have come to love about your blog.

I had the same struggle this month increasing our “going out to eat” budget to make life a little easier for the chef (that would be me!) I consider myself blessed to have the ability to increase this part of the budget without any major impact.

Tyler Karaszewski
Tyler Karaszewski
10 years ago

Due to a recent incident involving a potato peeler, the emergency room, and a ride in an ambulance, my wife has banned me from all future potato-preparation duties.

Also, I find it a bit ridiculous that some think buying dinner on your way home because you had to work late is controversial. “I worked late so I brought home take-out”, is not a moral or philosophical dilemma, especially at a cost of four dollars.

chacha1
chacha1
10 years ago

Have you ever been in a post-office line with someone who is totally antsy and huffy and sighing and bitching because they have to wait? And do you ever think, if your time is worth that much, why don’t you have someone to go to the post office for you? No one is too important to take care of their own business. If the business of the moment is editing, and there is a way (such as by picking up some prefab mashed potatoes) to meet another obligation (such as providing said potatoes for dinner) other than by personally spending… Read more »

Pinbot
Pinbot
10 years ago

They have this new product where you microwave a sealed bag of frozen potato chunks, then quickly mash and add your own secret ingredients. They aren’t quite as good as homemade. However, they mash easily, as they have been blasted by short, short waves and you skip all the peeling, cutting and boiling. Now these things aren’t cheap. You might pay as much as $4 for a bag, and I don’t even think it’s a whole pound. But, if you had a sack of these in the freezer, you could have made a nearly homemade product in less time that… Read more »

Shara
Shara
10 years ago

@Tyler As interesting as what you have to say is…I really want to know how you injured yourself severely enough with a potato peeler to send you to the e-room… @JD Your comment about $3.99 being worth it in this case for the convenience made me think of Thomas Sowell and his articles about ‘price gauging’. Namely in a given situation a service is *worth* more (why we’ll pay $3 for a bottle of water on vacation we would never dream of in our normal lives). And price is often the most efficient way to ration resources, or at least… Read more »

GoingGreen
GoingGreen
10 years ago

Wow did I ever need to read this today. Thanks for writing it, that 30 minutes was invested in helping others… never a waste!

I am going through major changes for 2010 and have started this process myself. I know its just the beginning, but I also know this is the real deal.

I’m so close, but I was wondering how to ‘view’ money. Up to now its been my road to instant gratification and debt. Time to change.

Adam
Adam
10 years ago

“And I’ve reached a place in my life where I can spend buy mashed potatoes from the grocery store and not feel an ounce of guilt because I know I’m practicing conscious spending.”

You can “spend buy” mashed potatoes eh?

No wonder its taking you so long to edit this book 😉

Just teasing, good post on the things money should be used for.

Scott R.
Scott R.
10 years ago

Man, I’m glad you didn’t open with the Ayn Rand quote, even just coming across her name in the comments here made me grumpy. Heh. I’m not offended by her or her work, per se, there’s plenty of ideas out there that I disagree with and easily ignore… but the opinions of her arrogant, selfish devotees bug me to no end.

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