3704: Sufficiency by Chris Guillebeau on Money Mindset

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[00:00:25] Propel Fitness Water with Gatorade Electrolytes, Zero Sugar, and Vitamins. Propel Hydrates Better Than Water to help you get the most out of your workout and get back to your best self. What propels you? Propel with Gatorade Electrolytes. This is Optimal Finance Daily, Sufficiency by Chris Guillebeau of chrisguillebeau.com. And I'm your narrator, Justin Malek, the guy that reads blogs or articles to you every single day of the year, including weekends.

[00:00:54] And holidays. And I appreciate you listening every single day. It really means a lot. So with that, let's get right to it as we optimize your life. Sufficiency by Chris Guillebeau of chrisguillebeau.com.

[00:01:12] I spent most of last week in and around Park City, Utah on a family vacation. I usually run in Portland, Oregon, where the elevation is about 230 feet or 70 meters above sea level. In Park City, the elevation is about 7,000 feet or 2,134 meters above sea level. Among other things, the altitude adjustment makes for one tired runner.

[00:01:38] I felt like I had picked up a pack-a-day smoking habit just before setting out to run a 10K. Aside from the only near-death experience I've ever had while trying to run a few miles, Utah was fun. I'm back home now before picking up the travel pace in about a week. Coming soon, New York City, South America, Saudi Arabia, and so on. But first, let's talk about sufficiency.

[00:02:04] Ever since I published 279 Days, where I wrote briefly about how much money I make, I've had a number of good conversations about personal income with people from all kinds of backgrounds. As I said in the manifesto, the challenge with talking about money in specific terms is that it's entirely relative. I have friends who earn more than a million dollars a year, and friends who are currently unemployed, earning virtually nothing.

[00:02:32] The more important discussion, I think, is to consider what money can be used for. Some people assume that choosing to be content with a limited income naturally limits my choices as well. The perception seems to be that I've given up more income to obtain a more simple life. In some cases, this is true. I've made more money in the past than I do now, and I regularly choose to pass on opportunities to increase my income

[00:03:00] so that I can focus on building my writing career. However, as true as that is, it's not really the whole story. To get the whole story, I have to say honestly that I don't feel limited at all. Most of the time, I do what I want with very few limits. I like the fact that I can take off on Southwest Airlines to see my family without counting vacation days and arranging time away from a job.

[00:03:27] I still work every day, no matter where I am, but since I like my work, that's okay. At the end of the month, I'm embarking on my biggest trip of 2009. The journey will take me to four continents over a couple of weeks. I don't have an unlimited budget, and there will likely be some airport floor sleeping somewhere along the way. But that's part of the whole experience. If I didn't want to go, I wouldn't.

[00:03:55] It's not just the big things. Small things are important too. I pay all of my bills the day they arrive. I visit the Great Chipotle several times a week, where they know my name and start making my vegetarian burrito before I order. I usually exercise before dinner, but if I want to, I can go for a run or to the gym at any time during the day. And I go to the coffee shop every afternoon and the waffle window every Sunday.

[00:04:23] I could go on and on, and in my own personal notes, I have gone on and on to a very detailed level because it's important to know what sufficiency means. What sufficiency means to me. First, here are a few definitions, courtesy of my good friend dictionary.com. Sufficiency. One, a sufficient number or amount. Two, adequate provision or supply, especially of wealth.

[00:04:54] And three, adequate means to live in modest comfort. As I see it, sufficiency simply means enough. It means having everything you need and not lacking for anything. Right now, that's exactly how I feel. I'm not getting rich, but I really do have everything I need. It's a pretty good feeling. I also know that there have been other times in life when I've had more money, but felt less secure about it.

[00:05:24] This tells me that while money is an important part of the answer, I also know that sufficiency is not all about money. Give me neither poverty nor riches. Is sufficiency all about giving up opportunities to have a higher income? No, not really. I think it's all about making deliberate choices. Here's the difference as I see it. Would I accept more money if it fell down from the sky?

[00:05:54] Yes, of course. Free money is good. However, would I walk very far to pick it up? No, probably not. I haven't taken any vows of poverty, and I believe that making money is generally a good thing. It's just that I'm more interested in thinking about what happens with the money. I also don't have any illusions about poverty, even the relative kind of poverty we have in North America. I've been relatively poor before,

[00:06:23] and while I never truly lacked for anything, there were definitely some limitations on my choices. Right now, being neither rich nor poor feels like a good place to be. I probably couldn't go out and buy a castle, but I'm not limited in the life experiences I value. I also believe that if I really wanted my own castle, I'd GTD it out and find a way to get one. Sufficiency, scarcity, and abundance.

[00:06:53] It's important to think about sufficiency because if you don't know what it looks like for you, you can easily fall into scarcity. The thing with scarcity is that you operate under the principle that resources are limited and that we can never truly have enough. We better work as hard as we can to ensure that we don't lose out to someone else. This is the default mode of operation for most of us. The challenge is to be self-aware and rise above it.

[00:07:22] For me, the most important principle of personal finance is self-awareness. The values of frugality and generosity are also important to me, but I don't think either can be consistently practiced without first being self-aware. Both frugality and generosity have to be related to a deeper value of clearly understanding how we think about money.

[00:07:47] To become self-aware, it helps to know exactly what sufficiency looks like for you. How much money do you really need to, A, meet your basic obligations, and B, do the things you want to do? Once you have that amount, you have the walk-away number. That's the number with which you can comfortably walk away from any commitment that is incompatible with who you are and what you really want.

[00:08:15] You can start to focus on building a life more than building a bank account. You learn to value experiences, things you do, more than possessions, things you own. One of the best feelings in the world comes from the awareness that everything will be okay. If you have that feeling, you know exactly what I mean. If you don't have it, it's not that difficult to get to it.

[00:08:41] It just involves a shift in thinking, a desire for change, and the courage to be different. Like a lot of unconventional choices, not everyone will relate. Some people won't get it at all. Others will get it but be unable to let go of deeply held beliefs about scarcity. And a few will embrace sufficiency and experience a life of purposeful adventure. I know which group I want to be in.

[00:09:12] You just listened to the post titled, Sufficiency, by Chris Guillebeau of chrisguillebeau.com. And I'll be right back with my commentary. You've heard me talk about how I started tracking every dollar in and out of my life back in 2010. It began as a business school assignment, and I liked it so much, I never stopped. For years, that meant a spreadsheet I updated by hand. Now, Monarch does it for me. It tracks everything.

[00:09:39] Accounts, investments, savings goals, and spending, all in one place. And going automatic showed me something my spreadsheet never did. My savings rate had slipped as my lifestyle crept up. It's like having a financial advisor in your pocket, flagging spending spikes before they become a problem. My favorite part is just asking the AI assistant, can I afford this vacation without touching my savings? And getting a real answer.

[00:10:07] Write your own money story with Monarch. Use code OPTIMAL at Monarch.com to get your first year of Monarch Core half off at just $50. That's 50% off your first year at Monarch.com with code OPTIMAL.

[00:10:49] Thank you to Chris. The part that jumped out at me here is the walk away number. And I think it's one of the more powerful ideas in personal finance, even though we usually don't hear it framed this way. Because as we've talked about before, most money advice is pointed in one direction, which is more. We've also talked about less, but Chris is talking about something different, which is knowing you're enough.

[00:11:15] The amount that covers your obligations and the stuff you actually care about doing. Once you actually know that number, it becomes leverage. You can look at a job or a client or an obligation that's making you miserable, and you can actually walk away because you know exactly what you need and you know you've got it. Without that number, you're kind of stuck chasing more forever because more has no finish line.

[00:11:45] And I'd bet most of us have never actually sat down and calculated it. We know our income to the dollar, most likely, but ask us what enough is, and we just shrug and say, well, more than this. So if you can, try to figure out your real walk away number. However, it changes how you look at just about everything. So thank you to Chris for this one. Have a great rest of your day. Thank you for being here. And I'll see you tomorrow,

[00:12:14] where your optimal life awaits.