Financial Independence—A Redefinition

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You’re listening to “Insights at the Edge.” Today I speak with Vicki Robin. Vicki is the coauthor of the national bestseller Your Money or Your Life, along with the late Joe Dominguez. Called “the prophet of consumption downsizers” by the New York Times, Vicki has lectured worldwide on the subjects of reducing consumption and achieving financial independence. I spoke with Vicki about how limits relate to freedom, what constitutes genuine fulfillment, and what financial independence really means.

Vicki, the tenth anniversary edition of Your Money or Your Life has come out this year, and I know that one of the key concepts is this idea of financial independence. What does that actually mean to you, financial independence?

Vicki Robin: Mmmm. Thanks for the question. Financial independence can mean, in most people’s minds, it means “I can actually live the most expansive life I want to, and I will never have to worry about money again.” And it could … actually, we have this image of, like, it’s a gazillion dollars, you know, yachts and Lifestyles of the Rich and Famous. But what we mean in Your Money or Your Life about financial independence, it’s several layers. It’s actually disconnecting, successively, more and more of your sense of well-being from the vagaries of the economy.

The first level of financial independence, really, would simply be unhooking your mind from the consumer messages. It’s easy to say that, and it’s not so easy to do. Being able to be aware of the messages coming in, to be aware of the story that it’s telling you, “You’re not okay unless you get this product,” to be able to have an internal yardstick for fulfillment, unhook yourself from the Joneses and say, “Well, you know, they have a Lexus. Would that really make me happy? Happy in proportion to the amount of my life I’d invest in getting it?” So being able to inquire as the consumer messages come, and really ask, “Does that work for me? Is that product or service or experience, is it going to take me where I want to go?” Unhooking from the envy that’s generated, the sense of shame that’s generated: “You’re not enough, you don’t have enough, you don’t look right.” If we could just unhook our minds from the consumer culture—not stop consuming, but consume consciously, consume choicefully, consume what serves us, and not a scrap more—that would already be a layer of financial independence. You could also call it financial bliss, if we could do that.

And then the next level would be getting out of debt, because if you’re in debt, you’re an indentured servant to the economy. You must be out there seeking a job. Very often, it’s not jobs that you want. You’re not spending your time doing what you’d like. So being in debt makes you a servant to the economy. Getting yourself out of debt means that you have more choice, no matter what the economy is doing. You can do what you choose. Also, getting out of debt means that you are not paying the normally about fifteen- to twenty-percent surcharge on using other people’s money. That would be the interest on your consumer debt. That means that, if you’re only paying the minimum on your credit card, eventually, when you finally pay that item off, you probably will have paid two to three times what the item was actually priced at when you bought it. So it actually liberates more time from not only paying off your debt, but paying off the interest on your debt. So that’s the next level. I mean, you imagine that that would be, for many of us, financial independence, if not bliss.

Then the next level is having savings equal to, what I would recommend is six months of expenses. That means at least three months of expenses, and that doesn’t mean just sitting in the mattress or sitting in a checking account. It means sitting someplace where you can turn that money in the bank into money in your hand. If you have that, and then if you get laid off … And we all know that we’re at, nominally, ten percent unemployment, and now probably, in terms of the discouraged workers, etcetera, we’re way above that. We’re probably fifteen, and some states are actually at fifteen percent unemployment. It means that, if you are one of the unlucky that gets axed … And if you think about the nonprofit world as well as the for-profit world, more and more foundations are limiting their funding, and so more and more organizations that are completely healthy in any other way have to lay people off. I don’t have to convince you of that, but, if you have money in the bank equal to three to six months of expenses, a layoff doesn’t mean an instantaneous scramble.

Then the next level out is competency. The more you can do for yourself, the less your dependence on paying people a lot of money to do things for you. That doesn’t mean doing everything yourself—I mean we’re not going to build our cars from scratch—but it means becoming ever more competent in areas of your life, being able to do the research, being able to learn how to turn the nut or bolt or whatever it is. That further empowers you to have a life you love, no matter what the economy does.

The next layer that we talk about is community, is that, well, what we’re looking for, when we buy things with money, is we’re looking for well-being. We’re looking for getting our needs met. Now some of our needs can get met better through community exchange, whether it’s with your family, or your neighbors, or through an alternative currency system, or Freecycle. The more you avail yourself of what is free right out there in the community for you if you will but participate, and also put some of your capacities and skills and stuff in your garage in community, that makes a whole layer of well-being that is simply person-to-person exchange.

So all of those things, if you can bring that to mind, imagine a life like that, where you have no debt. You have sovereignty over your own choices; you’re not being influenced by the consumer culture. You have money in the bank that gives you a feeling of expansiveness; you’re not going to die if you’re not hooked into the consumer economy. That you have community, and that you can do a lot of things for yourself, or at least you know you could learn how. You have that, and you have a lot.

And then finally, financial independence, for us, is that you have, that those savings are not just three or six months, that you have enough savings—you’re squirreling away twenty percent of your income, year in, year out, and that piles up to a pile of money that could product an income for you (just the money itself, passive income) equal to your expenses. Then you actually can be free of the job system. You could still do the work that you love. You can do it for love, not money. You can do it for money and use that money for charity. Or you can do things that you’ve—hobbies or travel—you can do things you’ve always dreamed of that are not lucrative. That would be, finally, the final level of financial independence.

That’s the whole story of what we mean by that term.

Tami Simon: I can imagine, listening to you, that it’s that final step that most people probably find both the most attractive and the most difficult to achieve.

Vicki Robin: Right. Yes, it’s attractive, and I have actually lived that way, well, for forty years. And I’ll tell you, it really is wonderful!

Tami Simon: Now how much money a year are you living on, if I can ask?

Vicki Robin: Well, at this point, I’m living on about $25,000 a year.

Tami Simon: Right. So that, I can imagine, also, a lot of people saying, “Well, I don’t know if I’m prepared to live on $25,000! That would be a huge change in my lifestyle to do that!” For some people.

Vicki Robin: Right. So I’m not asking people to live the way I do. You know, I have forty years of experience with this, and I’m a manifester of the highest order. All I have to do is think about something that I really need, and it shows up in the thrift store. So I’m not expecting people to do what I do. The approach in Your Money or Your Life, the steps in Your Money or Your Life, are not designed to produce cookie-cutter Vicki Robins. What it is designed for is so that people can pay attention, moment by moment, to the flow of money and stuff through their lives, and determine what part of that flow is essential for their survival, what part of the flow allows their lives to expand—it’s necessary because they don’t just want to survive; they want to thrive—and what part of that flow is consumer items that are unforgettable, they never lost their taste, whether it’s that perfect eco-tourism trip that you took to Costa Rica, or whether it’s the ultimate down coat, or it’s the piece of art that you put over your fireplace. They’re the things that are really worth your life energy. But in observing the flow, you will see a portion of where you invest your life energy—and that’s what we call money, is life energy, because you invest your life energy in getting it, and so when you spend it, you are spending your precious life energy, a portion of your, literally, in cosmic time, blink of existence. You have to make sure that, whatever that stream is of stuff that goes through your life that doesn’t really register on the happiness meter, that stuff will fall away.

It’s not an instantaneous thing. You know, we’re always looking for a quick fix. We want to read the article in a women’s magazine and get six tips, and be able to do it perfectly. This sets up a process of observation that will go on your whole life, and it will be ever more refined. The first twenty percent of the expenses that disappear are just the fluff. It’s the useless, unconscious stuff in your life. We’ve studied people who’ve done this program, and indeed, twenty percent just falls away.

Tami Simon: Can you give me a sense of what that twenty percent is? What kinds of things?

Vicki Robin: What that twenty percent would be? Well, one story is that a friend of mine, a good friend of hers died, and she went, part of the will, part of the request was, “Please have my friends come to my house and take what they want of what I have,” and so my friend went, and she opened up a bureau drawer, and she found up to two dozen white sweaters. You can imagine one white sweater, two white sweaters, three might be what you could use, but what were those two dozen about?

And I’ve heard this story in repeated ways, you know. Somebody else, when she started the program, discovered that she had a closet full of blouses that that many of them still had their tags on. And so you start to take a look at the things you spend money on when you’re looking for something else. This woman, who knows what was her motivation? But there was something else going on. This spending was not about white sweaters. It was about being ridiculed in high school for not having the right outfit. The woman who bought all the blouses with still tags on them, she said she realized that, every Friday, she would got to the mall to reward herself for a hard week of work, so these blouses were an expression of the hard week of work. Those are some examples.

Because the thing that happens is, you don’t just watch it, but you track it, you know? Whatever flow in your life you want to change, the way to put your hands on the steering wheel, the first act is to start to track what’s going on in that domain. It doesn’t matter whether it’s money, or time, or food, or your thoughts, or busyness. You just start to track, so you track, “Okay, how much do I spend for my morning coffee and muffin when I go to work?” and you start to see that you’re spending $2,000 a year on coffee and muffins! Once you take a look at that, once you take a look at the aggregate of that particular behavior—nothing wrong with the coffee and muffins; you might decide that it is totally worth the $2,000 a year, but you might decide that, if you bought muffins at the grocery store, they would be a quarter of that, and you just put one in the bag every day.

Tami Simon: Okay, now let’s pause for a moment. This idea of tracking all the money that I spend—and you said that the process of Your Money or Your Life, this process of becoming financially independent, begins with observation and tracking, and now I’m tracking—the idea of that is about as appealing to me as sticking needles in my eyes or cleaning out the garage! It just sounds terrible!

Vicki Robin: It sounds terrible! It really does! And so, you know, what can I say about this? It sounds terrible to me, too. I just have to say that.

Tami Simon: Okay, so I feel a little better now.

Vicki Robin: You know, there are people who take to this program like ducks to water, and I’ve noticed that they’re engineers and quilters. They’re these people who like to make things precise, orderly, and fit together seamlessly. And then, for the rest of us, we have to understand that this process is going to get us more of what we really want. You know, when you save money because you want to go on a vacation, you don’t want to save that money, but you want the vacation, so every week, you put your ten dollars in the bank, and whatever it is, because you’re saving up for something that you want. If you don’t have the vacation out there, when you think, “Oh, I should save!” you think, “Yeah, I should save, or I should go buy the blouse,” you know? Blouse is immediate gratification; saving is like, “Well, maybe I’ll never get old.”

So you start to put in, you start to pay attention to what you want more than having more stuff. What do you really want in your life? And this is a key to this whole approach is that you strengthen your bond with your vision for your life, you think about, “Okay, so I’m devoting all this money to my coffee and muffin”—whatever!—”What do I really want to devote my life energy to? Well, I have three nieces and two nephews. I would love to spend time with my nieces and nephews! I have, I never get to read a book. I would love to get to read a book! And as a matter of fact, I have …” I’m not saying I have three nieces and two nephews. I’m just saying examples of desires that you pick up, you know, from Nancy Pearl, who’s in Seattle, who wrote Book Lust, or you pick up, you know, what are 100 books you want to read before you die?

So this tracking becomes linked, not to this sort of sticking needles in your eyes! It becomes linked to, “I want my time back! I want to be doing what I want to be doing! And I can wish and hope for it, I can start to go on Match.com and hope I marry a rich guy, I can do all sorts of la-la-land strategies, or I can realize that I can reshape my financial life to better serve my deepest desires and goals.

Now, a complexity to this, one reason why it makes no sense to people in our era, is that we have credit cards, so with credit cards, you don’t have to save up for things. You just put it on the card, and you think, “Well, sometime in the future, I’ll pay for it,” or, “You know, I’ll just take out life insurance. My life insurance will pay for it!” or, “I’ll just die destitute. So what?” or, “My relatives, when I go, will pay for it.” You know? “Somebody will pay for it, but it’s not going to be me now.” So we have a tool for instant gratification that obscures the fact that we have only a few hours, actually, on this planet. Let’s say we have seventy-five years of life—and it’s a hard thing for me to think about, since I’m sixty-four, that’s a little close, but just for . . .

Tami Simon: Well, for the sake of the conversation, let’s say we have eighty-five years.

Vicki Robin: Yeah, for the sake of the conversation, let’s say I’m gone at seventy-five! So a third of that, twenty-five years, I’m going to spend sleeping. It’s an awesome thing to think about, but I will! A third of your life, you spend sleeping. Now, probably another third of that, another twenty-five years, is going towards “daily life.” Daily life would be, of course, you know, your job, but it’s also getting up in the morning and brushing your teeth, getting dressed, taking a shower, getting in the car. You know, it’s all that stuff. It’s two to three meals a day, cooking and cleaning (or maybe you go out to restaurants all the time because you don’t want to do the cooking and cleaning), but it’s cleaning your house, it’s taking the car in to get the gas, the oil changed, it’s all this stuff called “daily life.” Really. Daily life will take at least twenty-five years. And daily life isn’t bad. It’s your life! “How we spend our days is how we spend our lives,” as Annie Dillard said.

Then there’s this other twenty-five years that is your discretionary spending for your life. Into those years, we’ll fit . . . well, actually, you know, there’s another at least eighteen years that are spent just getting ready for life, just growing up! So there’s some small portion of your life that is your discretionary life. It’s the life into which fits all the loving, all the relating, all the learning about yourself and growing, all the meditating, all the traveling, all the art, all the theater, all the reading books . . . all of that is going to fit in that.

So it’s not an endless thing. It’s not like, “When I get around to it,” or, “I always mean to spend time with my nieces and nephews, but I just don’t have time!” What I’m encouraging is—and this tracking is merely a tool; it’s not virtue; it’s just a tool—it’s a tool to become aware of what you are actually doing with “your one wild and precious life.” And a piece of that is going to be saying, “I need at least three hours a day of hanging out,” of writing in my journal, taking a walk, you know, just “noodling around,” as Brenda Euland said. That’s what a writer has to do. You just have to hang out, because the ideas don’t come on cue. So, if you determine you need that, where is that going to come from? You know, for your muse, hanging out, waiting for the muse to come? That comes from somewhere, because life is limited, and so you start to realize that, by becoming aware of the flow of stuff through your life, or the flow of appointments, or the flow of food, when you’re becoming aware of those things and realizing which things contribute to your well-being and which don’t, you actually buy back portions of your life. Does that make it any more appealing, Tami?

Tami Simon: It creates motivation.

Vicki Robin: Exactly! Yeah, that’s the thing. It’s creating motivation, and it’s turning desire into motivation into action, because maybe … You know, we started out talking about financial independence, and you said, “Well, everybody wants that one where you have enough money and you don’t have to worry about it,” but somehow we have to get from Point A, trapped in daily life, to Point B, free! So what is that pathway? I mean, some people would stick pins in their eyes if they were told they had to watch their breath for an hour a day! We’re willing to do practices in service to our aspirations, or else we’re just not telling the truth. I mean: “I want to be able to ride in a rodeo.” I could say that every morning, but if I don’t get on a horse, I’m never going to get to the rodeo. Tracking is like getting on the horse.

Tami Simon: I want to go back for a moment to this idea of financial independence, because I think, when most people hear that term, they think of living on a huge amount of money that they have somehow, like, “I’m financially independent, so I don’t have any limits anymore,” not, “I’ve saved enough money so that I can live on $25,000 a year,” like you’re describing. I think the way it’s sort of portrayed in our culture, this idea of, “Oh, you know that person’s independently wealthy,” then that means they can kind of jet wherever they want to go and they’re not in this small, constrained world anymore. I think that’s why I responded when I asked you how much money you were living on as a financially independent person. I’m curious what you think about that idea.

Vicki Robin: (Laughing.) Great! I know it’s not funny, but it’s funny to me. Well, I think that maturation is the capacity to understand and shape the limits in your life, that immature consciousness wants it all, now: never have to work, never have to worry. I one time did a training where they said, “Okay, we have a system for actually having no worries ever again in your life. It’s called a saline bath, and we’re just going to cut you open, take out all your organs, we’ll have a breeding machine, and you can just float there.”

In other words, life is complexity. Life is, well, the Buddhists said it’s suffering. I think it’s at least dealing with competing desires, competing values, competing needs. It’s dealing with the dynamic between your desires and your fears. If you will—I mean some people would say this—it’s a school for self-knowledge and knowledge of what is this thing called “life” anyway? And I don’t think that life is a breeze. Life is fabulous, it’s enjoyable, it’s fascinating, but it’s not a breeze.

And so I think that what you’re talking about—which is so common; I’m not critiquing it—is that desire to almost go back to the womb and be completely taken care of, like, “Money will do it all for me. I don’t have to think. I don’t have to worry, because no matter what, I’ll have enough money.” Yes! We all want that! However, I don’t think that’s the life a conscious person really wants. I think a conscious person wants to be conscious and aware, and when you become conscious and aware, you understand that there’s suffering in the world, there’s complexity, there’s limitation, actually. A piece of my work, actually, Tami, over the years has been can I develop a language, a way of understanding limits such that Americans would fall in love with limits the way we’ve fallen in love with freedom.

Tami Simon: How’s that working for you?

Vicki Robin: Well, I’ve done it. It actually undergirds everything, and basically, what I say is that there is no freedom without limits. We wouldn’t have a word freedom if there were no limits, number one because every word comes into being because it has some contrast, it’s necessary to distinguish something in life. So freedom distinguishes something against a background of some sense of limitation or constraint. If you have no constraints, then the universe universe would come into being and “Pshoo!” it’s gone, because there’s no constraining force. The constraining forces in our lives are what shape our lives, for better or worse, richer or poorer.

What we want is not no limits; we want sovereignty over the limits in our lives. We don’t want to be told what to do, but we want to be able to choose, and if you understand that, on a material level, like, you know, our bodies are material. They are born and die. On a material level, nothing is limitless. On spiritual level, and an intellectual level, life is vast, but on a material level, it’s limited. That’s the world we live in. That’s why the Buddha called it “suffering.” So learning to live within limits is actually the refinement of your character. It is being able to direct your life and say where it’s going to go. You define the banks of the river through which life is going to flow, and you define them according to what? According to your purposes, according to your dreams and desires. But you get to say, to a great degree, what those limits are.

Now, you can’t say, “Okay, in my world, I’m not going to have gravity. I think I’ll get rid of gravity.” There’s some limits that are natural limits, and a piece of that is because we’re not the only people here. Despite the fact that we’re all pretty narcissistic—not you, not me, but everybody else, you know—despite narcissism. Narcissism says, basically, we’re the only people here. I’m the only person here, and everything else is a stage set and all of the people are extras, and so I get to do what I want. The mature function is understanding that you fit into a larger whole, which is a great relief, because you belong, and it’s a great relief because you have some function in the larger whole. You don’t just belong, but you have a function. You have a piece of the picture. You have something you have to give. Your life is like unwrapping a present: What is it that’s mine to give? What is it that’s mine to have, so that I can give what is mine to give? So you start to discover your place in things.

There are natural limits. There’s social limits, there’s legal limits, and all of these things exist so that we can be in harmonious relationships. The more you think about it, the more you realize, oh, I get it! Everything that I cherish has a boundary to it, has a beginning, middle, and end. Every thing I cherish, not my spiritual evolution, but every thing I cherish has a boundary, and that boundary protects the quality of that which I cherish. My house: If I didn’t put locks on the doors, and I lived in an unsafe neighborhood, pretty soon the stuff in my house would not be mine anymore. Somebody else would have taken it. That means, in some ways, maintain the boundaries of that which is precious to me.

Our values: Our values are defined by our yeses and no’s, by establishing boundaries, “This is what I will do, and this is what I won’t.” Our integrity is established by boundaries: You can count on me to do this for you. So we are actually, in our daily lives, unless we’re just sort of like lying on the couch with the clicker, we’re always in relationship with the limits of boundaries of our existence, and to become aware of those, and choiceful. And even the ones that are fixed: You say, “Okay, in my world, I’m going to have gravity. I think gravity would be a great idea!” You say “yes” to the things that you cannot change. This is the serenity prayer.

What I’m saying is that this dream of financial independence as never having to deal with anything unpleasant because you have enough money for it is a piece of an immature mind. I’m not saying that negatively. I’m not saying, “Oh, immature bad, mature good,” but basically, the task of our times is maturation. The task of our times is to learn to live within limits, because we are beyond the limits.

Tami Simon: I think what you’re saying is so important. I think that the reason that I asked sarcastically or globally, “How’s that going for you, teaching about limits and money?” is that it just seems, especially when it comes to money, especially for people who are interested in some kind of financial program, they are drawn to it because what they originally want is this idea of more money than they could possibly ever need. So you’re going against, it seems, a lot of the current in our society, which, I think, must be immature to you, to use your language.

Vicki Robin: Yes. I mean the immaturity is that you mature as you bump into things in life, you know? You bump into something that wasn’t supposed to be there. Then you have to deal with it. Why is it here? How do I feel in relationship to it? What do I really want? Is this here to protect me? Is this here for me to grow?

We have this idea of “the sky’s the limit,” and now with space travel, even the sky is not the limit! So we have this idea of “up, up, and away and out!” You know, the new age teaches us going beyond all limits, the limiting consciousness, and I agree with that 100 percent. We really need to, if you have a limiting consciousness, my recommendation would be that you track your thoughts, and you just see what’s going on in there about the limits that you’ve imposed, and see which ones you choose. Some of the limits that you choose might be when you hear yourself saying in your head, “Oh, I could never do that!” Well, you think about it, and if it’s about bungee jumping, you think, “Okay, it would take a huge amount of life energy to get me to bungee jump, so actually, I could never do that,” so that’s a limit that I choose. It’s a quality of learning, from your life experience, what life really is about, what you are made of, and what’s really precious to you. And as you go along, you start to realize that the coffee and muffin, pleasant though it may be not having to bring the muffin from home, these are sort of the small pleasures in life, but what, really, do you want your life to be about? That will evolve, too.

This awareness, this idea of having just enough, everything that you want and need and that makes your life wonderful, with nothing in excess? That is actually not a point. I call it the enough point, but it’s an enough spiral. It’s a constant inquiry in relation to existence: “Hmm. Is this thing, is this part of my enough, or is this part of my useless too much?” It’s ongoing. I know that, in my own life, my purposes have evolved as I’ve evolved. I’ve noticed that, in my twenties, I wanted something different than I want now in my sixties, and that’s all okay, because what’s been consistent is my attention to “What do I really want, really want?” I don’t know if I’ve elaborated any useful way here, but . . .

Tami Simon: You have, and I know also, Vicki, that you’ve done a certain amount of inquiry and research into the question of human fulfillment, and what we know about what actually creates genuine human fulfillment—not necessarily our ideas about what might fulfill us, but what actually fulfills us. Can you share some of that with us?

Vicki Robin: Yes. Studies of human happiness—and there have been many, and the whole field of positive psychology is actually a growing field, because people, despite all that we have and we have access to in this culture, the happiness quotient is not going up, so there’s great interest in what makes humans happy—what has been discovered is that one thing is fairness. That’s really interesting, would not be the first thing you’d think about, but whether you consider your lot in life—what you have, what you do, what you’ve achieved—whether you consider that sort of in balance with other people like you, whether it’s your neighbors, or people with your social class, or people with your education, what creates dissatisfaction is, you know, when you go back to your high school reunion and you notice that so and so is now a multi-millionaire, and you’re still doing a secretarial job. Then your secretarial job—which yesterday, when you were at the office, was great, because you love everybody at the office, and it’s all going well—then your secretarial job is one down. So a lot of our consumption is about status and belonging, about where you are in the pecking order. It’s about power relations. So if you feel sufficiently powerful in society as a whole, then you have this experience of contentment. You’re not worried about what you have, do, or be.

Another one is good friends. Good friends actually come before family, which is really interesting, because your family may not be your friends. Your family’s your family, and maybe you can count on them in a pinch, but your friends are the people who witness your existence, and support you in feeling okay about yourself and going forward in the things that you want. So having people that you can confide in—and I don’t have the statistics right now, but there is an increasing number of people who have no one to confide in, or maybe one person, and that’s a decreasing number over time. People had more in the past, and they have fewer now. It’s having that kind of friendship.

Another one is being in a community that nourishes you, and it’s hard right now, because our communities are online communities, you know, our six listservs that we’re on, the newsletters that we’ve signed up for, that come into our in-box. We have virtual communities, but not real communities, and people treat their jobs like a community, but it’s not really a community, because you can get a pink slip and then you’re ostracized, which is extremely painful for humans. So being inside social, legal, human systems that you feel are there for you: That’s a huge element of happiness.

Good health? Good health is crucial. For many people, it’s number one. And so those are some of the factors that have been determined are part of happiness.

There’s some recent research that I came across that just has knocked my socks off, that basically is research that’s been done about discretionary spending, and that if you spend money on experiences, versus spending money on things, that you’re happier spending money on experiences than things, because deeper than that is you’re happier spending money on other people than you are on yourself. You know? That if you buy a present for someone, that will give you happiness for a longer time, that gives a good feeling inside longer than if you buy something for yourself, because it . . . well, whatever that is, we’re social beings. What may be an element of that is to simply foster your sense of belonging. Basically they found that, if you spend money on experiences, very often those experiences are done with other people, and that when you see those people again, you remember the experience, so there’s a renewal of the happiness again and again. If you spend money on things, money spent on things is very often money spent to—you know, beyond survival level—money spent for status or belonging, you know, being part of the clan.

Tami Simon: Now there seems that there’s one thing that we have to dig into here, because when it comes to friendship and community, those are things that I have a lot of control over in my life. I can magnetize friends and a community whether or not I have money. It doesn’t matter. But when it comes to this other question of fairness: I go to my high school reunion, and blah blah blah, and this person has inherited ten million dollars, and this other person’s working in the financial services and is making all this money, and I compare my intelligence to these other people, and I think, “Wait a second! This doesn’t feel very fair!” and then I get all wrapped up in how much money I’m making or not making.

Vicki Robin: Yes, so what that means is that despite an inherent unfairness in the system we live in, because the system we live in . . . Studies have been done of happiness in our culture, and it actually shows that happiness, (because there’s an annual survey that’s done, I think out of Minnesota, a social survey, and one of the things they measure is happiness) our happiness peaked in 1957 and sort of stayed at a plateau until the early 70s, and then it’s been falling off some, so we’ve reached the peak of the happiness curve. If you think about that, coming out of World War II, there was a commitment to fairness in society, that everybody was getting prosperous together, there was a progressive income tax—people at the higher end were paying way more than people at the lower end—because there was an understanding, coming out of the second world war, that we’re all in this together, and we all won the war, and we’re still traumatized by the depression: People at the top and bottom, people who had millions of dollars and people who had a farm, all of them were affected. Everybody had a deep need to become prosperous together, and what it did was it built the middle class.

Now of course, I rebelled against that, but it was a backdrop of my life. I didn’t have to build that. That was there for me, and that actually was a foundation out of which I could bust out and start to explore the world. But the middle class held that sense of fairness in it, and so then, in the Reagan years, when we started to change the tax laws and started to disassemble this, then it permitted a split: a diminishment of the middle class, and the people in the middle class were still desperately running to stay in place, putting two people in the household in paid employment.

And even though that seemed like a win for the women’s movement, and for many women, paid work has been a way for them to develop beyond their wildest dreams, it also means that everybody in the household is stressed, because everybody is struggling in the money economy. And so the way we maintained this sense that there is something called “the middle class” is each worker worked longer hours, and there was more than one worker in the family, and so the family life, that well of well-being which is family life—being held and nurtured in a healthy family, being listened to, having somebody who puts you to bed and makes your dinner and is there when you come home for your lunch when you’re seven—that kind of thing that I had when I was a kid, that disappeared in service to this promise that everyone could get rich! Not everyone has enough. You know? And only some people seem to be doing it.

That split grew and grew and grew, until now we see the result of it. Now people who considered themselves middle class, who got the education, who get the B.A., the master’s, and even the Ph.D., are not being able to make it in the society that we have defined. They are being axed from their jobs for no good reason other than the company needs to make more profit, so that feeling . . . See, if you think about that process, then you realize that here we are in the land of plenty, that everybody else in the world envies, really, with people with magnificent yachts and jets, etcetera like that, and you know, that image, you use that imagery for, “Oh, I could jet around, just like the rich people!” that there is a sense of desperation and despair and increasing fear, that is in our midst. Michael Moore investigated that in Bowling for Columbine. Why is it, in this wealthiest of nations, that we have this experience of fear, that we actually feed fear—it’s part of our identity—and that there are other societies where people live perfectly happily, and they don’t have that same sense of fear? They have more of a sense of fairness.

So what do I do in the midst of that piece of the happiness formula that I don’t seem to be able to control? Or maybe I’m contributing to movements that are, in some way, trying to rebalance the accounts: the Take Back Your Time movement, or some of the environmental movements. There’s many movements, social justice movements, that are trying to rebalance the accounts. What I do is I develop this financial independence I was talking about, that isn’t about having a gazillion dollars. It’s about unhooking your mind from the consumer culture.

So you go to your high school reunion, and you see a person who’s made out like a bandit, and you haven’t, and you watch your mind. You say, “I am, right now, standing here. Like five minutes ago, in the last conversation, I was feeling fine about myself. In this conversation, I’m beginning to feel like a dishrag. I’m starting to feel like I’d like to leave, or at least go to the bathroom and see if my lipstick isn’t all over my teeth.” You know? It’s just like you start to feel terrible about yourself, and the task is to intercept that, and to be able go like, “Yeah. That person did that. Now what do I actually think about my choices? I like the choices that I’ve made.” So that’s the internal yardstick for fulfillment.

And that’s why this culture with so much unfairness in it, and others, you know? It’s becoming like, despite all of the efforts of our current administration to rebalance the accounts, it is, it has some of the qualities of, some of the less just cultures. I mean, if you take a look at the imprisonment of African-Americans, it’s astonishing! So we have qualities, for all we value justice, we have values in this country that are highly unjust, and most other Western, developed countries have solved these problems. The sickness care system—I don’t call it “healthcare,” because your body is healthcare, your body is a magnificent health-producing machine, or system—why is it that we can’t consider sickness care a right of all citizens? So that’s a piece of the unfairness.

What do we do in the midst of that? We really do need to anchor ourselves in our own sense of our values, our purpose, noticing all of the nonmaterial ways that we make ourselves happy, and actually that most of our happiness comes from experiences and giving, as the studies have shown, not from getting stuff for ourselves or proving that we’re better than other people. Those things are often a by-product of the financial system, the money system, the economic system we live in, because everything is so monetized that how are we going to hold our heads up in the world as it is? Well we think it’s going to be through something we can buy, something material, because we’re struggling to take part in the life of the whole. We’re struggling to find our place in things. And if the system is only giving us an opportunity to establish our identity and our contribution through things that we buy and money that we earn, then we start to ignore that which truly makes us happy, that is not in the material realm, and consequently undermine our sense of happiness.

So you’re absolutely right. That particular piece, that fairness piece, we have to work for fairness in society, but also work within to unhook ourselves from the envy and shame of these kinds of unequal social relations. Does that make sense?

Tami Simon: It makes a lot of sense. I think it’s a really important point that you’re making. Just as a final question, Vicki: I know that your interest in financial independence and Your Money or Your Life is obviously about individuals, but it’s also about change at a societal and global level, and I’m wondering if you can just make for us that connection in a very explicit way. How is it that the way we handle our own money creates change in the world?

Vicki Robin: Well, there’s many levels of that question about how we spend our money, or our relationship with money, and the outcome for the collective. One thing is that we vote with our dollars, clearly, so what we spend money on, what we invest ourselves in, is actually what we’re voting to have more of in the world. And so this noxious idea of tracking every penny, or tracking every dollar, or tracking every ten dollars, whatever you’re tracking, it’s really a way to say, “What is it that I’m investing my life energy in? What is it that I’m demonstrating? What is it am I teaching to the world about what’s important?” So that’s one thing, is that your money life is just like your life life, is a teaching, and is a steering mechanism.

The second thing I think is that, people ask, in the past and now, too, “Well, what if everybody did this? What if everybody dropped twenty percent of their expenses, just naturally? What if everybody lived frugally? Wouldn’t it ruin the economy?” My contention is that we live in an economy that is like a predator on the natural systems, and we are in this condition where we are spending more of the ecological capacity of the planet every year than can be regenerated, and that is by about twenty-five percent, now. We just need another quarter planet, somehow, every year. I don’t know where we’re going to get it, but we need it. So imagine that twenty-five percent is exactly the twenty-five percent of unneeded consumption that is flowing through our personal lives. In some way, that number relates. Now I can’t draw it directly, like “If you don’t drink your coffee, then the coffee farmers in Columbia . . .” blah, blah, blah. I can’t draw it directly, but I am saying that we are over budget, collectively, and so we, collectively, especially the over-consumers in the North, and the wealthy in the South, need actually to moderate our consumption.

This is a very tough thing to teach anybody who thinks its their right to consume, it’s right to consume, and it’s their money, and you can’t tell me what to do with it! But if we could voluntarily have people choose, because their well-being depends on ceasing certain behaviors, they could choose that, then we could live, actually, within the means of the earth in some way. Balancing those accounts, getting it to be fair, all of that is very complex, but in some way, that excess needs to go.

Another thing is that I’m working now, locally, on Whidbey Island. I helped to start and maintain an organization called Transition Whidbey—we’re into our third year now—which has been inspired by the whole way of thinking about re-localization, that in the context of climate change and resource depletion, water depletion, unstable economies around the world, peak oil . . . in light of all this, we need to take greater responsibility for resource flow through our community. It’s not pulling up the drawbridge and saying, “The rest of the world can take care of themselves,” but it does put back on the shoulders of communities, of place, to consider what we’re dependent on the big global systems for, and how we’re going to take care of ourselves, should those systems become more disrupted—and I would guarantee that they are going to be more disrupted. We need to take that into account, so this whole transition movement, or re-localization movement, is about communities taking responsibility for resource flow just the way Your Money or Your Life allows individuals to take responsibility for resource flow.

It’s really resource flow in relation to: What do we value as a community? What makes my little town of Langley Langley? What makes Whidbey Island Whidbey Island? What makes life wonderful here? How do we have enough, if not a surplus, of what makes life wonderful, even if the ferries stop running? Because we’re an island! I don’t think the ferries are going to stop, but they may be constrained. If there were a war in the Middle East, and certain oil supplies that we rely on were no longer available to us, you’d better believe that the military is going to commandeer more of the oil supplies, and the rest of us are going to have to figure out how to monitor consumption, so we may have fewer ferries. In that situation, how do we continue to have a wonderful life? I think this is a crucial question.

You know, our culture has cultivated hyper-individualism, and hyper-individualism says, “Me first, second, third, and last! Me alone! I’m going to do it! I can do it; I’m going to do it!” and that’s why we all feel so busy, because we think we have to do it all ourselves. And it’s hyper-competition, you know? Like it’s a world of all against all, and if I’m not scrambling to get to the top of the mountain, I’m going to lose, because nobody’s there for me. We really need to make this shift from “me” to “we,” to be able to say that my well-being, in a certain degree—I don’t know, ten percent, twenty percent, fifty percent—my well-being, to a certain degree, depends on the well-being of my community. That is my strategy for well-being: collective well-being. It’s not about personal well-being.

And so we have a collective task—and this is really what undergirds all of my work now—which is we need, individually, collectively, in small groups, large groups, to devote ourselves to learning to live well, together, within the means of the earth. That is the task of our times. If we don’t complete that task, we’re going to be in disruptions that we really do not want to be in. There are many strategies for that, and that’s where all of the creativity comes from, like, “How are we going to do that?” That’s the game. That’s a game worth playing.

These community re-localization or transition groups are a way, or context, for that kind of work. Working in local government is a context, working in local service organizations is a context, but our transition group here on Whidbey Island has devoted ourselves to catalyzing our community to work together toward greater resilience. We’re trying to bring together all of these different elements that are committed to community well-being, and create a synergistic whole that’s working consciously towards water conservation and a farming system, not just this home gardens or CSAs, but a farming system on the island where the farmers are collaborating, so that they’re growing exactly what the community needs in the right proportions. We’re working on local business, cultivating local businesses, whether they’re internet based actual storefronts. How do people prosper more locally, and how do we become less dependent on whatever it is percentage of the island that gets on the ferry every morning so that they can go to work in Seattle? How can we live well here? So we’re engaged actively. We’ve developed a local currency that’s beginning to take hold actively in that question of taking responsibility for resource flow at the level of the community.

So these are some ways where this whole-systems approach to the flow of money and stuff through your life—that is that Your Money or Your Life approach: tracking, looking for pattern, evaluating, understanding that there are certain limits to your life energy, and re-shaping your life around what matters most, that approach—having learned that in your personal life, you can bring that to your community life, or to the life of the organizations that you’re in. It’s a very exciting time to be engaged in this! It’s a scary and creepy time, because we’re really up against it, but as I said earlier, that’s maturation. Maturation at the level of the species is how we’re going to live well together, here, on our one little home.

That’s how, and if you want to probe that further, I’m happy to talk about it, but there’s many levels there where you can see how your personal transformation actually contributes to your capacity to be part of the larger picture.

Tami Simon: Thank you, Vicki, for being with us on “Insights at the Edge.” We’re here talking about the tenth anniversary edition of Your Money or Your Life, and Sounds True has also published an original audio adaptation of Your Money or Your Life with Vicki Robin, available at soundstrue.com. For listeners who would like more information on the work of Vicki Robin, including a new teleclass series that she’s offering, you can visit yourmoneyoryourlife.info. Thank you for listening.

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