Purpose and the value of money

I mentioned the other day that my financial philosophy has changed a bit since I left Get Rich Slowly in 2012. One of the biggest shifts is where I believe we should place our focus.

  • In the olden days, I thought money itself was a fine focus. I wanted out of debt. To achieve that goal, I needed money. Today, I view debt reduction as a side effect, not a goal.
  • After I got out of debt, I wanted to build my savings. To achieve that goal, I needed money. Today, I view savings as a side effect, not a goal.
  • After I built a modest nest egg, I wanted to gain greater wealth. To achieve that goal, I needed money. Today, I view wealth as a side effect, not a goal.

After I gained greater wealth, I realized something. I’d been chasing the wrong thing. What I really wanted was happiness, and happiness isn’t something you can just go out and grab. Just as debt reduction, savings, and wealth are side effects of certain choices, happiness too is a byproduct of our choices and the lives we lead. Happiness comes when our actions are aligned with our purpose.

Gradually, I came to understand that purpose was actually my goal all along. Truly, it’s the goal for each of us. When we have a purpose, and when we’re able to pursue that purpose with passion, everything seems to fall into place.

A big reason I returned to writing about money after three years away? I realized it’s part of my greater purpose. That’s also part of the reason I bought back Get Rich Slowly.

None of this is new, really. People have been thinking about this and talking about it for centuries. For millennia. But each of us needs to come to this realization on our own.

Some folks never have this epiphany, and that’s fine. But for those of us who do experience it, it can change our lives. It changes how we view our work, our play, our relationships — and our finances.

The Real Value of Money

This is all on my mind because a couple of weeks ago, I read an article from Mark Manson on the real value of money. Money, Manson says, is merely a store of value — one of many stores of value in our lives. It’s not that money is intrinsically valuable; it’s that it represents value.

He writes:

Money is a touchy subject. That’s because most of us, to a certain degree, associate a lot of our self-worth and identity to our job and how much money we make. It is, quite literally, a market valuation of our skills and competence as a person, and therefore we all get a little bit testy and scooch around uncomfortably in our chairs whenever money is brought up. But money is merely an arbitrary store of value. It is not value itself.

Manson spends some time discussing the nature of money: its nature, its fluidity, its effects. He describe how money creates what he calls “experience cycles”, some of which are positive, and some of which are negative. “People who fall into these experience cycles with their money soon become slaves to earning a buck,” Manson writes. “They begin to see money as the singular purpose of their life. It becomes the whole of their motivation.”

I think you can see where he’s going here. Like me (and millions before us), Manson is arguing that true wealth isn’t really about money.

To Manson, true wealth only occurs when the way you earn your money is aligned with your values. True wealth only occurs when the way you spend your money is aligned with your values. And true wealth only occurs when your earning and spending are aligned with each other. “Money is often a means towards success,” he writes, “but it is rarely success itself.”

Here’s the key takeaway:

The real value of money emerges when we leverage it as a tool towards our success rather than making it success itself. When we channel it towards the experiences and values that we find more important. When we use it to build an innovative business, when it fuels our creativity or infuses our community, when it supports our family or shares love with our friends or adds to our personal health and satisfaction.

In short, the real value of money comes when it helps you pursue your purpose.

Instead of simply reading the handful of quotes I’ve posted here, I encourage you to read the entire article at Manson’s always excellent site: The Real Value of Money.

Do What Works for You

And here’s the key takeaway I want you to get from my article: Purpose is powerful — but there’s no single right purpose for everyone. Each of us is different. Each of us has unique strengths and weakness, unique value systems. What’s right for me may not be right for you.

Over the years, I’ve met a lot of folks who are passionate followers of certain authors and speakers. Sometimes these authors and speakers focus on money, sometimes they focus on religion, sometimes they focus on politics. Their followers like what they say (or, sometimes, how they say it), and without realizing that it’s happened, they gradually adopt the value systems of these gurus. In effect, they adopt the guru’s purpose as their own. I think this is a mistake.

The path to purpose is different for each of us. You need to do what works for you!

Instead of adopting a guru’s purpose (and belief system) as your own, you ought to sift through what he writes or says to find the bits that ring true to you, the elements that are applicable to your life.

The thing is, most of us never consciously consider our purpose. In fact, a lot of folks think this sort of talk is a bunch of new age bullshit. It isn’t. (Or it doesn’t have to be.) Taking time to consider what you truly want out of life is an excellent way to help steer you in a direction that makes you happy, a direction that brings you true wealth. (Coincidentally, it often leads to monetary wealth, as well.)

Who Are You? — and What Do You Want?

The first thing I ask readers to do at Money Boss is to to create a personal mission statement. I think that’s a great exercise, and I encourage you to do that too, but I don’t intend to fully promote my Money Boss agenda here at Get Rich Slowly.

Instead, I hope you’ll set aside a few minutes to answer three simple questions, questions that can at least prod you toward thinking more about your purpose — and how that purpose relates to money. These questions come from The Seven Stages of Money Maturity by George Kinder. (He, in turn, seems to have borrowed them from the work of time-management guru Alan Lakein.)

Here are the three questions Kinder uses to help his clients get clear on their values:

    1. Imagine you’re financially secure. You have enough money to take care of your needs, both now and in the future. How would you live your life? Would you change anything? Let yourself go and describe your dreams. What would you do if money were no object?
    1. Now imagine that you visit your doctor. She reveals you only have five to ten years left to live. You’ll never feel sick, but you’ll have no notice of the moment of your death. What will you do in the time you have remaining? Will you change your life? How will you change it? (Note that this question does not assume unlimited wealth.)
    1. Finally, imagine your doctor shocks you with the news that you only have 24 hours to live. Nothing can be done. At this time tomorrow, you’ll be dead. What feelings arise as you confront your mortality? What did you miss? Who did you not get to be? What did you not get to do?

Answering the first question is easy (and fun). There are many things we’d do if money were no object. But as the questions progress, there’s a sort of funnel. They become more difficult to answer, and there are fewer possible responses.

According to Kinder, the third question usually generates responses that follow five general themes:

  • Family and relationships. Ninety percent of responses to the final question contain this topic.
  • Authenticity or spirituality. Many responses involve leading a more meaningful life.
  • Creativity. Surprisingly, a large number of respondents express a desire to do something creative: to write a science-fiction novel or to play guitar like Eric Clapton.
  • Giving back. Further down the list are themes about giving back to the community, about leaving a meaningful positive impact.
  • A “sense of place”. A fifth common theme (though nowhere near as prominent as the top three) is a desire to have some connection with place: a desire to be in nature, to live someplace different, or to help the environment.

Kinder says that some people — the facts and figures people — look at these questions and ask, “What does these have to do with money?” They have everything to do with money. When you understand what you want to do with your life, you can make choices — financial and otherwise — that genuinely reflect your values.

All of these questions are meant to cause the participant to ask herself, “Who am I as a person, stripped from what I do as a job every day? Is it possible to derive meaning and satisfaction with this stripped away?” Inevitably, the answer is yes.

From my experience — I’ve used these questions in workshops for several years now — your answers can also be like a roadmap to help you discover true value of money.

The first time I wrote about Kinder’s work here at GRS was in February 2009. I’d just attended a conference where he presented his three questions. Answering them had a profound impact on my life, changing its course entirely. I didn’t see my exact purpose all at once, but I did see that my life wasn’t congruent with my values. I made changes — one of which was selling this site. (Ironic then that re-purchasing Get Rich Slowly is congruent with who I am in 2017!)

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There are 17 comments to "Purpose and the value of money".

  1. dh says 18 October 2017 at 07:00

    I think happiness is the byproduct of *one* choice — which is choosing to be happy, something we can do at any given time no matter what the circumstances are. This is the basic message of spirituality taught in books like The Power of Now. Money is something we have to work towards; unlike happiness, we can’t just choose to have it on the spot.

    As for “purpose” and “passion,” there was recently a great New York Times article on the subject describing how these things can be found most often in the mundane:


  2. Dave+@+Married+with+Money says 18 October 2017 at 07:06

    I’m not sure I agree that things like saving and paying off debt are side effects – I see them as important stepping stones in the pursuit of purpose and happiness. Perhaps it’s semantics, but I do see those as very different things (side effect vs. intentional step).

    That being said I do agree with your general premise that what we’re all after is happiness and purpose. Saving money, while something that can make you feel better, isn’t what most people are after. They’re after the flexibility and freedom that comes with having enough money saved to be able to pursue what they feel passionate about in life, and what they believe their purpose is.

    • J.D. says 18 October 2017 at 09:44

      I’ll do an article soon on what I mean when I say that debt, saving, and wealth are side effects. I truly believe that they are.

    • aivanther says 18 October 2017 at 11:44

      I think I get what JD is saying. If I’m right, calling getting out debt as a side effect might be best explained by this thought experiment: If you are losing weight say your goal is 220lbs. Is losing weight truly the goal? Really, is 220lbs really the goal? Or is it better said “My goal is to be healthy and look better.” 220lbs may be a benchmark, or side effect, to the healthy and look better. In fact, I may get to 220lbs and realize I am healthier, but still flabby, just no longer grossly obese, and recalibrate my next benchmark to 200lbs. After all, yes I celebrate reaching a benchmark, but ultimately I want more than simple number for my weight, my goal is to be healthy and look better, not a simple number.

  3. Jackie says 18 October 2017 at 09:02

    I love this article. We get so focused on saving and eliminating debt that we forget what our purpose. Answering those three questions remind me that I would like to have unique experiences with my family. Seeing the world with our own eyes versus a computer screen or TV. I took my son to his first football game and we got a chance to go down on the football field and run around. That’s an experience that we can’t put a price on. Great article. Glad to see you’re back!

  4. Budget+Kitty says 18 October 2017 at 09:44

    Money is a tool that can help you achieve your goals, but you have to have a purpose in your life to guide you toward those goals. I think the Kinder questions you mention are a great way to define your own purpose, and they can also help start a discussion with your spouse to see how closely aligned your purposes really are. I think this will make a great discussion on our next date night! We tend to get so wrapped up in the day to day stuff that we can forget about our true goals and values.

  5. Sam says 18 October 2017 at 10:17

    I have thought about my purpose for a long time. As I have gotten out of debt, started to invest and watch the money start to compound I asked myself “What does it mean.” I realized recently that money by itself means nothing, and I probably spend too much time thinking about it.

    Money is only a tool, a means to an end. It can by stuff, experiences, or sit in a pile in an account somewhere. Happiness is the goal, and money is simply a tool to buy my freedom, peace of mind, and hopefully can be used to help others.

    Thank you for your thoughts. It has given me a lot to think about.

  6. Art says 18 October 2017 at 10:31

    Great article! Thanks so much, and I’m glad you’re back, JD. I was a loyal GRS reader for many years, and your website helped my wife and I lay a solid foundation for managing our money. Since you left GRS, I’ve been a big fan of MMM and Budgets are Sexy, but I am looking forward to checking back in regularly to read your new posts. Welcome home.

  7. Gina+Pogol says 18 October 2017 at 15:14

    The relationship between money and happiness can be complicated. I used to think I needed a lot of money to be “wealthy” and not “have” to work. But what I really wanted was freedom. I am much happier spending less and enjoying work that I really love.

    • J.D. says 18 October 2017 at 15:15

      Gina, I want to take this comment and print it out and staple it to the wall of my writing studio! You’ve achieved some true wisdom there.

      • Gina+Pogol says 18 October 2017 at 15:16

        Getting old has to be worth something 🙂

  8. lmoot says 18 October 2017 at 21:34

    This is why I calculate my savings based on percentage of goal accomplished. Ex. I don’t have $10,000. I have 40% saved towards a down payment on a house (I don’t).
    I’ve never been able to just save in a general savings account. I have to have a goal attached to every dollar. I

    Regarding the question of only being alive for 5-10 years, but not having infinite wealth…good thing I only need enough wealth for 5-10 years! 😉 I’d live it up. Visit everyone. Eat everything. Hike everywhere. And do as much good as I can.

    As for what I want. I just want peace, and choice. And time.

  9. Christine says 19 October 2017 at 06:39

    I feel like if I knew I was going to die tomorrow, I would do everything the same as I usually do, except that I wouldn’t work. I would take the day off and play with the kids in the back yard, read to them, take them for a walk and spend time with my husband. Maybe I would take them to a petting zoo or farm like I do sometimes on the weekend. I would just want to see them happy and to spend time with my husband. And I would probably want to take some time to write a letter to the kids and my husband to tell them all things I wouldn’t get to tell them in the future. Mainly how much I love them.

    If I was living for 5-10 years, I would probably still work, because I have a very large life insurance policy through work and I would want my family to be taken of after I pass. Plus I like my job and my co workers. However, I would definitely try to work less hours. Currently working 45-50 and I would cut down to 35-40.

    I feel like my answers aren’t enough. Am I missing something?

    • J.D. says 19 October 2017 at 06:42

      I don’t think you’re missing anything, Christine. I think it sounds like you’ve found your purpose and are living a life that is aligned with it. That’s a Good Thing. I like it.

  10. FrugalStrong says 21 October 2017 at 09:31

    This is an excellent article! I found a lot of good nuggets I hope to share with others. And if I only had 24 hours, my first thought is that I’d be completely and utterly selfish in every way! 😀

  11. Damn Millennial says 22 October 2017 at 20:31

    Love the term “experience cycle” I had never heard that before, thanks for the read.

  12. shobir says 26 October 2017 at 03:45

    I don’t think getting out of debt and building wealth is a side effect. I think a lot of people would be insulted with that view. I have managed to get out of debt and build wealth and I achieved this because it was a target. If I wanted to be happy I would have just spent more and got into more debt. I think it’s important to realize that happiness comes in many forms for many people, having tangible targets keep people out of trouble.

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