Whenever I contemplate time, and the finite amount we have on this earth, I am reminded of the quote from Kansas’ song Dust in the Wind: “…and not another minute will your money buy.”
So, let me pose this question: If you could, would you buy more time?
For most people the default answer would be “Yes, of course, who wouldn’t”.
Time’s Exchange Rate
But what if the exchange rate (trading current time for future time) was advantageous. In other words, if you, say, worked a whole day and by working that whole day you earned a half a day more tacked on to the end of your life, how would that sound?
As interesting as that may be as a thought exercise, eventually, you would still run out of time. Yet you’d probably force yourself to work harder and harder as the inevitable darkness closed in. Earning another half day for each whole one spent. Buying a little more future time at today’s expense.
Marcus Aurelius in Meditations writes: “Think of yourself as dead. You have lived your life. Now take what’s left of it and live it properly!”
Indentured Servitude
You spend your life working endlessly, day in and day out, out of necessity (after all, you have to ‘make a living’ to pay your bills). But you, like most, are an indentured servant. Wait, you say, an indentured servant? There must be some mistake. I’m a free person!
Nope, no mistake. If you are working to pay a mortgage, an auto lease, some ‘buy now pay later’ scheme (e.g. credit cards), or to service any sort of debt whatsoever, you aren’t working for you, you’re working for your creditors. You are indentured to them until your debt is paid. It’s that simple. It’s a modern take on an age old principle of control.
This is how folks become ‘house poor’, get mired in student loans, and wake up one day to find themselves on the neverending hamster wheel of debt servicing.
Making a living is important and necessary since nothing in life is free. Yet, how we decide to go about doing so is entirely within our personal power to define, influence, and pursue. And as I’ve written previously, less is more.
Herein lies the trap: “In eating the appetite grows,” – Caderousse, from The Count of Monte Cristo.
Your Appetite for Things Devours Your Time
That’s the rub. When you’re starting out in life, you don’t have much, and your often grateful for what you get, but as your career progresses and your earnings grow, so does your appetite. Regardless of how much money one earns (Elon Musk and Jeff Bezos aside, we’re just talking mere mortals here) there are endless bobbles to gobble up your cash and credit.
There will always be a nicer house, a faster car, a fancier purse, a shinier necklace, and a fancier vacation waiting to soak up all that hard earned money and send you back to the salt mines to find more. Not only will these things rob you of your treasure, but they will also rob you of something far more precious: your time – more specifically the time you spent earning the money to pay for these things. Time you will never get back.
There will always be more money, but your time is limited – some might argue unjustly so.
Things = Money = Time
We can express this problem as such: Things = Money = Time
Or we can truncate it to: Things = Time
If you are struggling to attain financial freedom, this is an incredibly important concept. Look around your home. Take stock of all your possessions. Open closets and drawers to assess your inventory of clothing you never wear and accessories you never use. Check your pantry for food and medicine that you purchased years ago and is now expired. Look in your garage, attic, or basement at the piles of stuff that have accumulated there. What about that storage unit you rent every month, but never visit, filled with crap you don’t need?
All of it, every last bit of it, cost money at some point, and by money, I mean time.
For fun (warning: this may turn out not be so fun once you arrive at a sum) grab a calculator, and to the best of your ability, try to recollect what you paid for these items you no longer use or need. In the case of any storage units, add in the cost of storing all of this garbage on top of the cost of acquiring it. The final number may shock you. If you earn an hourly wage, divide that into the total to discover how much of your life you committed to the accumulation of these items. How do you feel?
What if…
What if instead of buying all that stuff and paying to store it, you had purchased a stock and bond portfolio? And what if you have invested all that cash in dividend paying stocks that throw off 4 – 8%? Would this hypothetical income be enough for a down payment on a house or enough to pay off your car? Would it have paid off your college loans? How would your money be working for you now rather than the other way around?
How much of this stuff was financed using credit? Did you pay interest or fees? If so, you’re probably still paying for it!
You Aren’t Mindless. Aren’t You?
I realize the ah-ha’s that derive from this exercise can be shocking, but hopefully now you’re prepared to make some real changes.
Generally, stuff (unless collectible) loses value the minute you buy it. On the other hand, quality assets (emphasis on quality) tend to not only appreciate over time, but often provide much needed cashflow. They pay you to own them!
For banks and credit card companies, keeping up with the Joneses is the most desired behavior of every ‘consumer’. That’s what you are after all, just a mindless consumer buying useless crap that will end up in a landfill or your attic or who really cares where as long as you keep making your payments with interest on time each month. At least, that’s how your creditors see you.
Whether you realize it or not, when you buy anything using credit, you have made the decision to mortgage your time to the bank until the debt is repaid. Period. The longer you take to do so, the costlier it is for you and the more profitable it is for the bank.
Not all debt is bad, however. Taking out a reasonable loan to buy an appropriate dwelling or rental can make a lot of financial sense and build generational wealth. On the other hand, financing your fast fashion wardrobe on high interest credit cards will transfer your wealth to the bank and effectively inhibit your ability to accumulate wealth in the first place. You are transformed into an indentured hamster running forever on the wheel of debt.
And the further you extend yourself, known as leverage, the more likely the hamster wheel will consume all of your time and degrade the quality of your life.
Buying Time
Before I buy anything, I ask myself two questions:
- Why do I want/need it?
- Is the need for myself or does it stem from a urge to impress someone else (a Jones, perhaps)?
For example, if you are shopping for a new car, are you more intent on its inherent utility, specs, gas mileage, etc. Or are you picturing how starstruck the valet will be when you pull up in front of the restaurant? Spoiler: the valet doesn’t give a shit and neither do the folks waiting for their cars, nor do your neighbors, co-workers, or anyone else for that matter.
If anything, too fancy a car will garner the wrong kind of attention – envy and jealousy most often.
So, if financial freedom is fleeting, we should focus on buying fewer things (heresy, I know). They should be of higher quality and utility. Possessions that pay for themselves in full as soon as practical. Ideally, things that grow in value and/or produce cash flow. And very few that are ego or impulse driven primarily for the purpose of impressing others.
While this sounds simple, in reality, these principles lack the immediate gratification ego driven purchases provide. They lack sexiness.
While you can’t buy more time, you can rent, lease, or give less of it away. The less you surrender, the more you have to enjoy. It’s kinda like that old fable about the ant and the grasshopper. If you are facing a winter of debt, you may want to start acting more like the ant. While it’s sexier to live like the grasshopper in summer, the ant has it made in the shade the minute the weather turns.
