Friday, May 08, 2009

Save your money

"The value in money lies in its capacity to support personal freedom -- possessions, by their nature, restrict freedom and promote attachment." - G. Byrn

The last time I went out with RDM a few weekends back, I went on a rant about saving money. It's one of my frequent/favorite topics of discussion with him and I know he's probably sick of it... so I'll broaden my audience and sicken all of you.

Like many companies in my industry, my employer recently went through a mass culling. Now, a lot of my work friends no longer have the "work" identifier. What's freaky is the number the people I've spoken with who are terrified of losing their homes because they won't be able to cover their mortgages, even with a decent severance package.

I was lucky in that in my first job out of school, my company went through a bad patch and cut salaries to 70%. I was living close to hand-to-mouth at the time (or so I thought) and as a result, couldn't afford my rent. Fortunately, I was able to move back in with my folks for a few months until I found a few roommates to share an apartment. That was the last time I ever wanted to be in a position of having no emergency savings. It takes a while for anemic bank accounts to grow, but it's possible for everyone to get there. You just might have to cut out some of the unnecessary things (TV, bar nights, restaurants).

My luck was that I learned that lesson at a fairly young age, at a time when I had no significant responsibilities (it's debatable if I even have any now...). I can't imagine being in my 40s with two kids and a mortgage to handle and not having learned the lesson already.

I place a tremendous value on money. But, the value is security, not its ability to be exchanged for stuff. I'm far from financially independent, but I'm not as worried as a lot of other people.

I don't have much attachment to the stuff that I own, with the exception of a few gifts and photos. Yes, I like gear (shoes? bags? bikes?), but I'm also okay with losing almost all of it. Everything is replaceable if I need it, and if I don't need it (shoes? bags? bikes?), then I'm not bothered about replacing it if something happens.

If I had a kid, the one lesson I know I'd teach him or her (probably right around the same time as toilet-training): "Save at least 10% of everything you earn. If at the end you have some left, you can always give it away when you die. And get a college rowing shell named after you. Because nothing says, 'he saved his money' more than a bunch of preppy kids rowing a piece of carbon fiber with your name on it."

I might omit all but the first sentence. I'm still perfecting the speech. I've tested it on the cat, but he doesn't follow my advice, which is why he has no savings and is a complete freeloader.

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