Summary of Your Money or Your Life

2/1/2016
SummaryofYourMoneyorYourLife|VickiRobin
Transforming Your Relationship With Life
Summary of Your Money or Your Life

TransformingYourRelationshipWithMoneyandAchievingFinancial
Independence
Summarized(withcareanddedication)byeditorClareMosswithLaurenceToltzto
introducepeopletotheninestepprograminYourMoneyorYourLife.Itisbasedon
theoriginalbooksoHowthisbookcameaboutThisbookisnotbasedontheory,
goodideasoranewphilosophy.Itistheresultof50yearsofcombinedexperience(30
yearsforJoeDominguez,20yearsforVickiRobin)inlivingtheprinciplespresented
here.Thisbookjustdidnthappen,itevolved.JoeDominguezwasasuccessfulfinancial
analystonWallStreetbeforeretiringattheageof31,neveragaintoacceptmoneyfor
anyofhiswork.VickiRobingraduatedwithhonorsfromBrownUniversityandlaterleft
abuddingcareerinfilmandtheaterinNewYork.Heropenmindallowedherto
recognizethevalueofJoesnewroadmapformoneyandapplyittoherownlife.Heand
VickiRobinwerefoundersoftheNewRoadMapFoundation,anallvolunteer,non
profitorganizationthatpromotesahuman,sustainablefutureforourworld.Joe
DominguezdiedonJanuary11,1997.Hisworkandmessageliveoninthetransformed
livesofprogramfollowersthroughouttheworld.YourMoneyorYourLifeisfullof
examples,storiesandexperiencesofmanypeoplewhohavefollowedtheirninestep
programintheirjourneytofinancialindependence.Askyourselfthesequestions:
Doyouhaveenoughmoney?
Areyouspendingenoughtimewithfamilyandfriends?
Doyoucomehomefromyourjobfulloflife?
Doyouhavetimetoparticipateinthingsyoubelieveareworthwhile?
Ifyouwerelaidofffromyourjob,wouldyouseeitasanopportunity?
Areyousatisfiedwiththecontributionyouhavemadetotheworld?
Areyouatpeacewithmoney?
Doesyourjobreflectyourvalues?
Doyouhaveenoughsavingstoseeyouthroughsixmonthsofnormalliving
expenses?
Isyourlifewhole?Doallthepiecesyourjob,yourexpenditures,your
relationships,yourvaluesfittogether?
http://vickirobin.com/books/summaryofyourmoneyoryourlife/
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Ifyouanswered,notoevenoneofthesequestions,readon.ThepurposeofYourMoneyorYour
Lifeistotransformyourrelationshipwithmoney.Thatrelationshipencompassesmorethanjustyour
earning,spending,debtsandsavingsitalsoincludesthetimethesefunctionstakeinyourlife.In
addition,yourrelationshipwithmoneyisreflectedinthesenseofsatisfactionandfulfillmentthatyou
cangetfromyourconnectiontoyourfamily,yourcommunityandtheplanet.Onceyouhavechanged
thenatureandfunctionofyourinteractionwithmoney,throughfollowingthesteps,yourrelationship
withmoneywillbetransformedyouwillreachnewlevelsofcomfort,competenceandconsciousness
aroundmoney.Manybooksonmoneyareavailabletoday.Whatthesebookshaveincommonisthat
theyassumeyourfinanciallifefunctionsseparatelyfromtherestofyourlife.Thisbookisaboutputting
itallbacktogether.Itisaboutintegration,awholesystemsapproachtoyourlife.Itwilltakeyouback
tobasicsthebasicsofmakingyourspending(andhopefullyyoursaving)ofmoneyintoaclearmirror
ofyourlifevaluesandpurpose.Itisaboutthemostbasicoffreedomsthefreedomtothinkforyourself.
WhatyoucanexpectfromthisbookThroughthehundredsofletterswevereceived,weknow
someofthewayspeoplesliveshavebeenenrichedbyfollowingtheprograminthisbook.
Theyfinallyunderstandthebasicsofmoney.
Theyreconnectwitholddreamsandfindwaystorealizethem.
Withagreatsenseoffreedomandrelief,theylearnhowtodistinguishbetween
theessentialsandtheexcessinallareasoftheirlivesandhowtounburden
themselves.
Theyfindtheirrelationshipwiththeirmatesandchildrenimprove.
Theirnewfinancialintegrityresolvesmanyinnerconflictsbetweentheirvalues
andtheirlifestyles.
Moneyceasestobeanissueintheirlives,andtheyfinallyhavetheintellectual
andemotionalspacetotakeonissuesofgreaterimportance.
Atatangiblelevel,theyretiretheirdebts,increasetheirsavingsandareableto
livehappilywithintheirmeans.
Theyincreasetheamountoftheirfreetimebyreducingexpensesandthe
amountoftimeonthejob.
Theystopbuyingtheirwayoutofproblemsandinsteadusesuchchallengesas
theopportunitytolearnnewskills.
Overall,theyhealthesplitbetweentheirmoneyandtheirlifeandlife
becomesoneintegratedwhole.
Theoldroadmapformoneyhastrappedusintheveryvehiclethatwassupposedtoliberateusfromtoil.
Thelandmarksoftheoldroadmapwereclear:ninetofivetillyouresixtyfiveoweyoursoultothe
companystore,pushingforahigherstandardoflivingregardlessofmoral,ethical,emotional,
cultural,spiritual,marital,environmentalandpoliticalconsequences.Anditdeliveredbutonlyas
longaspeoplereallyneededmorematerialpossessions.Whenwearenottakingouridentityfromour
jobs,weareidentifiedasconsumers.Accordingtothedictionary,toconsumeistodestroy,squander,
useup.Weconsidershoppingtoberecreation,soweshoptillwedrop.Wewantagoodfutureforour
kids,soweworkharderorbecomeatwoincomefamilyanddelegateraisingthekidstodaycarecentres
ornannies.Webuythemthenewesttoystoproveourlove.Wearespendingsomuchofourprecious
timeearninginordertospendthatwedonthavethetimetoexamineourpriorities.Ouroldfinancial
map,insteadofmakingusmoreindependent,fulfilledindividuals,hasledustoaweboffinancial
dependencies.Frombirthtodeathwehavebecomefinanciallydependentonourparentsforourfirst
financialsustenance,ontheeconomyinordertogetagoodjob,onthejobforoursurvival,on
unemploymenthandoutstotideusoverbetweenjobs,onourpensiontopayourwayinoldageandon
Medicareifwegetsickbeforewedie.Thematerialprogressthatassupposedtofreeushasleftusmore
enslaved.Atsomepointinthelastfortyyears,though,conditionsbegantochange.Formanypeople,
materialpossessionswentfromfulfillingneedstoenhancingcomforttofacilitatingluxuryandeven
beyondtoexcess.Unlikethepast,problemsbegantoemergethatcouldnotbesolvedbyprovidingmore
materialgoods.Theplanetitselfbeganshowingsignsofnearingitscapacitytohandletheresultsofour
economicgrowthandconsumerismwatershortages,topsoilloss,globalwarming,ozoneholes,
speciesextinction,naturalresourcedegradationanddepletion,airpollutionandtrashbuildupareall
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signsthatoursurvivalisinquestion.Eventhoughwewontheindustrialrevolution,thespoilsofwar
arelookingmoreandmorespoiled.Newtoolsfornavigationareneeded.Whatweneedisanew
financialroadmapthatisbasedoncurrentglobalconditionsandoffersusawayout.CREATINGA
NEWROADMAPFINANCIALLYINDEPENDENTTHINKINGHowdoyoufindanewroadmapfor
money?Itrequiresthinkinginnewways.Oneofthekeystocreatingyournewroadmapiswhatwecall
FinanciallyIndependentFIThinking.Thisistheprocessofexaminingthosebasicassumptionsthat
youhaveunconsciouslyadopted,ofevaluatingyourownroadmap.Untilyoucandeliberatelyand
dispassionatelyquestionyourowninnerroadmapformoney,youwillbestuckinclassicfinancialdead
ends,suchas:
Spendingmorethanyouearn.
Buyinghighandsellinglow.
Notlikingyourjob,butnothavingawayout.
Needingtwopaycheckstomakeendsmeet.
Beingsoconfusedbymoneythatyouleaveittotheexperts,whointurnfeedon
yourignorance.
ExploringthefollowingconceptswilltransformyourrelationshipwithmoneyandwillleadyoutoFI
FinancialIntelligence,FinancialIntegrityandevenFinancialIndependence.Financial
IntelligenceInordertogainFinancialIntelligenceyoufirstneedtoknowhowmuchmoneyyou
alreadyhaveearned,whatyouhavetoshowforit,howmuchiscomingintoyourlifeandhowmuchis
goingout.Butthatisntenough.Youalsoneedtoknowwhatmoneyreallyisandwhatyouaretrading
forthemoneyinyourlife.OnetangibleoutcomeofFinancialIntelligenceisgettingoutofdebtand
havingatleastsixmonthsofbasiclivingexpensesinthebank.Ifyoufollowtheprogramwepresent,it
willleadtoFinancialIntelligence.FinancialIntegrityFinancialIntegrityisachievedbylearning
thetrueimpactofyourearningandspending,bothonyourimmediatefamilyandontheplanet.Itis
knowingwhatisenoughmoneyandmaterialgoodstokeepyouatthepeakoffulfillmentandwhatis
justexcessandclutter.FinancialIndependenceFinancialIndependenceisdefinedashavingan
incomesufficientforyourbasicneedsandcomfortsfromasourceotherthanpaidemployment.Itisalso
independencefromcripplingfinancialbeliefs,fromcripplingdebt,andfromacripplinginabilityto
managemodernconveniencesfromrepairingyourcartofixingyourcentralheating.Financial
independenceisanexperienceoffreedomatapsychologicallevel.Youarefreeoftheguilt,resentment,
envy,frustrationanddespairyouhavefeltaboutmoneyissues.FinancialIndependencehasnothingto
dowithrich.FinancialIndependenceistheexperienceofhavingenoughandthensome.Theold
notionofFinancialIndependenceasbeingrichforeverisnotachievable.Enoughis.Enoughforyou
maybedifferentfromenoughfromyouneighborbutitwillbeafigurethatisrealforyouandwithin
yourreach.YourMoneyorYourLifeIfsomeonethrustaguninyourribsandsaidthatsentence,
whatwouldyoudo?Mostofuswouldturnoverourwallets.Thethreatworksbecausewevalueourlives
morethanwevalueourmoney.Ordowe?Wheresallthelifewesupposedlymadeatwork?Formanyof
us,isntthetruthclosertomakingadying?Arentwekillingourselvesourhealth,ourrelationships,
oursenseofjoyandwonderforourjobs?Wearesacrificingourlivesformoneybutitshappening
soslowlywebarelynotice.Eventuallywemayhaveallthecomfortsandevenluxurieswecouldever
want,butinertiaitselfkeepsuslockedintotheninetofivepattern.PsychotherapistDouglasLaBier
documentsthissocialdiseaseinhisbookModernMadness.Hefoundthatfocussingon
money/position/successattheexpenseofpersonalfulfillmentandmeaninghadled60percentofhis
sampleofseveralhundredtosufferfromdepression,anxietyandotherjobrelateddisorders,including
theubiquitousstress.Whatdowehavetoshowforit?Ifthedailygrindweremakingushappy,the
irritationsandinconvenienceswouldbeasmallpricetopay.Ourlevelsofdebtandourlackofsavings
maketheninetofiveroutinemandatory.Participantsinourseminars,whateverthesizeoftheir
incomes,alwayssaidtheyneededmoretobehappy.Weaskedpeopletoratethemselvesona
happinessscaleof1(miserable)to5(joyous),with3beingcantcomplainandwecorrelatedtheir
figureswiththeirincomes.Inasampleofover1000people,fromboththeUnitedStatesandCanada,
theaveragehappinessscorewasconsistentlybetween2.6and2.8(notevenathree),whetherthe
personsincomewasunder$1000amonthorover$4000amonth.Ifthiswerejustaprivatehellit
wouldbetragedyenough.Butitsnot.Ouraffluentlifestylesarehavinganincreasinglydevastating
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effectonourplanet.ThecreationofconsumersPerhapsweclingtoouraffluenceeventhoughit
isntworkingforusortheplanetbecauseoftheverynatureofourrelationshipwithmoney.We
projectontomoneythecapacitytofulfilourfantasies,allayourfears,sootheourpainandsendus
soaringtotheheights.Infact,wemeetmostofourneeds,wantsanddesiresthroughmoney.
Webuyeverythingfromhopetohappiness.Wenolongerlivelife,weconsumeit.Wehavecometo
believe,deeply,thatitisourrighttoconsume.Ifwehavethemoney,wecanbuywhateverwewant,
whetherornotweneedit,useitorevenenjoyit.Andifwedonthavethemoneyheck,whatarecredit
cardsfor?Wehavetakenourrighttoconsumetoheart,andperhapsplaceditaboveotherrights,
privilegesanddutiesofafreesociety.Atthesametime,betweentheads,ourtelevisions,radiosand
newspapersarereportingthebadnewsabouttheenvironment.Productpackagingiscloggingthe
landfills.Productmanufacturingispollutingthegroundwater,deforestingtheAmazon,foulingthe
rivers,loweringthewatertable,depletingtheozonelayerandchangingtheweather.Transformingour
relationshipwithmoneyandreevaluatingourspendingactivitycouldputusandtheplanetbackon
track.Weneedtolearnfromourpast,determineourpresentrealityandcreateanew,realitybased
relationshipwithmoney,discardingassumptionsandmythsthatdontwork.Thebeginningofa
newroadmapformoneyThereisawordthatprovidesthebasisfortransformingyourrelationship
withmoney.Itsawordweuseeveryday,yetwearepracticallyincapableofrecognizingitwhenits
staringusintheface.Thewordisenough.Enoughforoursurvival.Enoughcomforts.Andeven
enoughlittleluxuries.Wehaveeverythingweneedtheresnothingextratoweighusdown.Its
appreciatingandfullyenjoyingwhatmoneybringsintoyourlifeandyetneverpurchasinganythingthat
isntneededorwanted.Sowhatsallthatstuffbeyondenough?Itswhateveryouhavethatdoesntserve
you,yettakesupspaceinyourworld.Clutter!Toletgoofclutter,then,isnotdeprivation,itslightening
upandopeningupspaceforsomethingnewtohappen.Enoughisawideandstableplateau.Itisa
placeofalertness,creativityandfreedom.Fromthisplace,beingsuffocatedunderamountainofclutter
thatmustbestored,cleaned,moved,gottenridofandpaidforontime.NINEMAGICALSTEPSTO
CREATEANEWROADMAPThesestepsaresimple,commonsensepractices.Itisabsolutelynecessary
thatyoudiligentlydoeverystep.Thestepsbuildoneachother,creatingthemagicpartofsynergy
thewholeisgreaterthanthesumofitsparts.Youmaynotseethiseffectuntilyouhavebeenfollowing
thestepsforanumberofmonths.Conscientiouslyapplyingallthestepsautomaticallymakeyour
personalfinancesanintegratedwhole.Step1:MakingPeaceWithThePastThepurposeofthisexercise
istoincreaseyourawareness.Itservestolocateyouintimeandspaceandreviewyourearningand
spendingactivityinthepast.A:Howmuchhaveyouearnedinyourlife?Findoutyourtotal
lifetimeearningsthesumtotalofyourgrossincome,fromthefirstcentyoueverearned
toyourmostrecentpaycheck.How:
SocialSecurityAdministrationRequestforStatementofEarnings.
CopiesofFederalorStateTaxReturns.
Paycheckstubsemployersrecords.
Why:
Givesaclearpictureofhowpowerfulyouareatbringingmoneyintoyourlife.
Eliminatesvaguenessorselfdelusioninthisarena.
Instillsconfidence,facilitatesgoalsetting.
Thisstepisoneofthefoundationstonesoftheprogram.Sinceaccuracyandaccountabilityarecalled
forineverystepoftheprogram,startingoutimpeccablyisagoodexampletoliveupto.Notonlythat,
butdoingthisstepimpeccablymayevengetyouabetterjobwithbetterpay.Socheckagain.Haveyou
reallydonethisstepwithintegrity.Peoplewhodoahalfheartedjoboftengetalifetomatch.Outside
theUnitedStatesitmaybedifficultornotpossibletogetpasthistoryofyourearnings.Ifthis
informationisnotavailable,thenwesuggestyoulistallyourpreviousjobsyoucanrememberand
estimatewhatyouthinkyouearnedeachyearaftertax.B:Whathaveyougottoshowforit?
Findoutyournetworthbycreatingapersonalbalancesheetofassetsandliabilities
everythingyouownandeverythingyouowe.How:
Listandgiveacurrentmarketvaluetoeverythingyouown.
Listeverythingyouowe.
Deductyourliabilitiesfromyourassetstogetyournetworth.
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Why:
Youcanneverknowwhatisenoughifyoudontknowwhatyouhave.Youmight
findtherearealotofmaterialpossessionsthatarenotbringingyoufulfillment,
andyoumightwanttoconvertthemtocash.
Thisisaverybasic,fundamentalpracticeforanybusinessandyouarea
business.
Whileitmaynotappearso,thispointintheprogramisveryencouraging.Sofaryourfinanciallifehas
hadverylittledirectionorconsciousness.Younowhaveanoverviewofyourfinancialstatusandcan
objectivelychoosewhetherornottoconvertsomeofyourfixedassetsintocash,thusincreasingyour
savingsorgettingabitfurtheroutofdebt.Andremember,Noshame,noblame.Increatingyour
balancesheet,manyfeelingsassociatedwithyourmaterialuniversemayarise:sadness,grief,
nostalgia,hope,guilt,shame,embarrassment,anger.Adispassionateandcompassionateattitudecan
goalongwaytowardmakingthissteptrulyenlighteningandmakingyouabletolightenthephysical
andemotionalloadsyouvebeentotingaroundforyears.Step2:BeingInThePresentTrackingYour
LifeEnergyWhatisoneconsistentlytruestatementwecanmakeaboutmoneythatwillallowustobe
clear,masterfulandpowerfulinourrelationshipwithit?Moneyissomethingwechoosetotrade
ourlifeenergyfor.Ourlifeenergyisourallotmentoftimehereonearth,thehoursofpreciouslife
availabletous.Whenwegotoourjobswearetradingourlifeenergyformoney.Youcouldevensaythat
moneyequalsourlifeenergy.So,whilemoneyhasnointrinsicreality,ourlifeenergydoesatleastto
us.Itstangible,anditsfinite.Itispreciousbecauseitislimitedandirretrievableandbecauseour
choicesabouthowweuseitexpressthemeaningandpurposeofourtimehereonearth.Moneyis
somethingyouconsidervaluableenoughtospendeasilyaquarterofyourallottedtimehereonearth
getting,spending,worryingabout,fantasisingaboutorinsomeotherwayreactingto.A:Howmuch
areyoutradingyourlifeenergyfor?Establishtheactualcostintimeandmoneyrequired
tomaintainyourjob,andcomputeyourrealhourlywage.How:
Deductfromyourweeklyincomethecostsofgettingtoandfromworkthecost
oftheclothesyoubuytowearatworktheextracostofatworkmealsthe
amountspenttorelaxandwinddownafterthestressofaworkdayjobrelated
illnessandallotherexpensesassociatedwithmaintainingyouonthejob.
Addtoyourworkweekthehoursspentinpreparingyourselfforwork,travelto
andfromwork,thetimetakentowinddownathomeafterwork,recreation
needafterworkasameansofwindingdown,shoppingtomakeyoufeelbetter
sinceyourjobfeelslousy,andallotherhourslinkedwithmaintainingyourjob.
Dividethenew,reducedweeklydollarfigurebythenew,increasedweeklyhour
figurethisisyourrealhourlywage.
Individualswithvariableincomescangetcreativetakemonthlyaverages,a
typicalweek,whateverworksforyou.
Mostpeoplelookatthislifeenergy/earningsratioinanunrealisticway:Icanearn$440aweek,I
work40hoursaweek,soItradeonehourofmylifeenergyfor$11.Itisnotlikelytobethatsimple.
Thinkofallthemonetaryexpensesthataredirectlyassociatedwithyourjob.Inotherwords,ifyou
didntneedthatmoneyearningjob,whattimeexpendituresandmonetaryexpenseswoulddisappear
fromyourlife.Why:
Thisisaverybasic,fundamentalpracticeforanybusinessandyouarea
business.
Youareinthebusinessofsellingthemostpreciousresourceinexistenceyour
lifeenergy.Youhadbetterknowhowmuchyouaresellingitfor.
Thenumberthatresultsfromthisstepyourrealhourlywagewill
becomeavitalingredientintransformingyourrelationshipwithmoney.
Thebookoffersexamplesofthecostandhourswespendthataredirectlyrelatedtohavingajob:
Travellingtoandfromworkcouldcost$50aweekandtakeyou7.5hours.
Annualcostofclothingforwork,dividedby50weeks,$15aweek.
Timeperweekdressingandpreparingforwork,1.5hours.
Costofworkrelatedmeals,coffeebreaks,lunches,$20aweek.
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Costofworkrelatedmeals,coffeebreaks,lunches,$20aweek.
Timeperweekofmealsandbreaksatwork,5hours.
Manypeoplearrivehometiredanddrained,ittakesmanypeopleaboutanhour
adaytorelaxaftertheygethome,soperweek,5hours.
Inaddition,thereisthecostofescapeentertainment,jobrelatedillnessaswellasvacationstorecover
fromwork.Thebookoffersthefollowingexampleshowingtheeffectofworkrelatedexpensesonan
ordinary40hour/$440week.
LifeEnergyvs.Earnings:WhatIsYourRealHourlyWage?
Basicjob
Hours/Week
Dollars/Week
Dollars/Hour
(beforeadjustments)
40
440
11
Commuting
+7.5
50
Costuming
+1.5
15
Meals
+5
20
Relaxingathome
+5
20
Escapeentertainment
+5
20
Vacation
+5
20
Jobrelatedillness
+1
15
70
280
Adjustments
Timeandmoneyspentonmaintainingjob
(totaladjustments)
Job,withadjustments
(actualtotal)
Thischartshowshowa40hourworkingweekcanactuallytakeup70hoursofonestime.Andalso
howawageof$440canbereducedbyworkrelatedexpensesof$160toleaveonly$280for70hoursof
workrelatedtimeor$4anhouror$1every15minutes.Sonowyoucanunderstandthatotherthan
workrelatedexpenses,everydollarspentcanrepresent15minutesoflifeenergyforthepersoninthis
example.B:Keeptrackofeverycentthatcomesintooroutofyourlife.Sofarwehave
establishedthatmoneyequalslifeenergy,andwehavelearnedtocomputejusthowmanyhoursoflife
energyweexchangeforeachdollar.Nowweneedtobecomeconsciousofthemovementofthatformof
energycalledmoneyineverymomentofourlivesweneedtokeeptrackofourincomebykeepinga
DailyMoneyLog.Religions,ancientandmodern,andthepersonalgrowthworkshopsofthehuman
potentialmovementallhavetechniquesfortrainingthemindtobeherenow,inthemoment.These
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techniquestakemanyformsandincludesuchseeminglydiversetechniquesascountingbreaths,
keepingtheattentiononeachincomingoroutgoingbreath,repeatingaphraseoverandoveragainin
ordertofocusthewanderingmind.Tothislistweaddanotherdisciplinetosharpenawarenessone
thatisindispensabletothefinancialprogramandperhapsmoreeasilyacceptedbyourgrounded,
materialisticWesternmentalitythatsomeofthemoreesotericpractices.Insteadofwatchingyour
breath,youwatchyourmoney.Thispracticeissimple:Keeptrackofeverycentthatcomesintoor
goesoutofyourlife.How:
Devisearecordkeepingsystemthatworksforyou(suchasapocketsizedmemo
book).Recorddailyexpendituresaccurately.Recordallincome.
Why:
Becauseitsthebestwaytobecomeconsciousofhowmuchmoneyactually
comesandgoesinyourlifeasopposedtohowyouthinkitcomesandgoes.Your
commitmenttoclearingupyourrelationshipwithmoneyisreallytestedhere.In
mostofusthereisapenchantforgivingourselvesleewayandlatitude.Oneof
thekeystosuccessinthisprogram(andinlife)isashiftinattitudefromoneof
laxityandleewaytooneofaccuracy,precisionandimpeccability.
Step3:WhereIsItAllGoing?(TheMonthlyTabulation)Dontworry.Relax.Thisprogram
isnotaboutbudgeting.Budgets,likediets,dontwork.Theydontworkbecausetheydealwith
thesymptomsandnotthecause.Thecauseoffatisnotreallythecaloriesinthefood,itsthedesiresin
ourmind.
Everymonthcreateatableofallincomeandallexpenseswithin
categoriesgeneratedbyyourownuniquespendingpattern.
Balanceyourmonthlyincomeandoutgototals.
Convertdollarsspentineachcategorytohoursoflifeenergy,
usingyourrealhourlywageascomputedinstep2.
How:
Simplearithmetic.Acomputerhomeaccountingprogrammaybeuseful.
(AcomputerisnotessentialasbothauthorsachievedFinancialIndependencewithoutusing
computers.)Why:
Thismonthlytabulationwillbeanaccurateportraitofhowyouareactually
livingandprovideafoundationfortherestoftheprogram.
Thebookoffersexamplesofcategoriesofspendingandsampleworksheets.Step4:ThreeQuestions
ThatWillTransformYourLifeOnyourmonthlytabulation,askthreequestionsofeachof
yourcategorytotalsexpressedashoursoflifeenergyandrecordyourresponses:
1.DidIreceivefulfillment,satisfactionandvalueinproportiontolifeenergyspent?
2.Isthisexpenditureoflifeenergyinalignmentwithmyvaluesandlifepurpose?
3.HowmightthisexpenditurechangeifIdidnthavetoworkforaliving.
Atthebottomofeachcategory,makeoneofthefollowingmarks:Markaminus[]oradownarrowif
youdidnotreceivefulfillmentproportionaltothehoursoflifeenergyyouspentinacquiringthegoods
andservicesinthatcategory,orifthatexpenditurewasntinfullalignmentwithyourvaluesand
purposeorifyoucouldseeexpensesinthatcategorydiminishingafterFinancialIndependence.Marka
plussign[+]oranuparrowifyoubelievethatuppingthisexpenditurewouldincreasefulfillment,
woulddemonstrategreaterpersonalalignmentorwouldincreaseafterFinancialIndependence.Mark
zero[0]ifthatcategoryisjustfineonallcounts.How:
Withtotalhonesty.
Why:
Thisisthecoreoftheprogram.
Thesequestionswillclarifyandintegrateyourearning,yourspending,your
values,yourpurpose,yoursenseoffulfillmentandyourintegrity.
Thiswillhelpyoudiscoverwhatisenoughforyou.
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Askingyourself,monthin,monthout,whetheryouactuallygotfulfillmentinproportiontolifeenergy
spentineachsubcategoryawakensthenaturalsenseofknowingwhenenoughisenough.Justsayyes
tobeingconscious.Thisprogramisbuiltonconsciousness,fulfillmentandchoice,notonbudgeting
anddeprivation.Itsaboutidentifying,foryourself,whatyouneedasopposedtowhatyouwant,what
purchasesortypesofpurchasesactuallybringyoufulfillment,whatrepresentsenoughforyouand
whatyouactuallyspendmoneyon.Youlearntomakeyourfinancialchoicesindependentlyofwhat
advertisingandindustryhavedecidedwhatwouldbegoodfortheirbusiness.Youarefreeofthe
humiliationofbeingmanipulatedintospendingyourlifeenergyonthingsthatdontbringyou
fulfillment.ItisaformofFinancialIndependencetojustsaynotounconsciousspending.AndtheTao
TeChing,theancientChinesebookofwisdom,putsitthisway:Hewhoknowshehasenoughisrich.
FinancialIntelligenceisknowingthatifyouspendyourlifeenergyonstuffthatbringsonlypassing
fulfillmentanddoesntsupportyourvalues,youendupwithlesslife.Thisstepisnotaboutbudgeting,
notaboutselfcondemnationandnotaboutdeprivingyourself.Itisabouthonoringandvaluingthat
limitedresourcecalledyourlifeenergy.Itsaboutusingthishighselfesteemtobringaboutgreater
fulfillment,greatersatisfactionandagreatersenseofwholeness,alignmentandintegrity.Youdothis
bybecomingmoreconsciousofyourunexaminedandunrewardingspendingpatternspainlessly.
Step5:MakingLifeEnergyVisibleCreatealargeWallChartplottingyourtotalmonthly
incomeandtotalmonthlyexpensesfromyourmonthlytabulation.Putitwhereyouwill
seeiteveryday.How:
Getalargesheetofgraphpaper,andchooseascalethatallowsplentyofroom
aboveyourhighestprojectedmonthlyexpensesormonthlyincome.Use
differentcoloredlinesformonthlyexpensesandmonthlyincome.
Why:
Itwillshowyouthetrendinyourfinancialsituationandwillgiveyouasenseof
progressovertime,andthetransformationofyourrelationshipwithmoneywill
beobvious.
Youwillseeyourexpenselinegodownasyourfulfillmentgoesuptheresult
ofinstinctive,automaticloweringofexpensesinthosecategoriesyoulabelled
withaminus.
ThisWallChartwillbecomethepictureofyourprogresstowardfullfinancial
independence,andyouwilluseitfortherestoftheprogram.Itwillprovide
inspiration,stimulus,supportandgentlechiding.
Whenyoudothisstepthefirstmonth,youhaveasnapshotaveryrevealingoneofyourhabits
aroundmoney.Butthereallearning,andtherealfun,comesasyouplotthefiguresmonthbymonth,
yearbyyear.Yourwallchartwilltakethetwodimensionalworldofyourmonthlytabulationandadd
thedynamicdimensionoftime.Itremindsusthattransformingourrelationshipwithmoneytakestime
andpatience.Impatience,denialandgreedareactuallypartofwhatisbeingtransformed.Thebook
containssamplewallchartsandguidelinesforcreatingyourown.Step6:ValuingYourLifeEnergy
MinimizingSpendingLearnandpracticeintelligentuseofyourlifeenergy(money)which
willresultinloweringyourexpensesandincreasingyoursavings.Thiswillcreategreater
fulfillment,integrityandalignmentinyourlife.How:
AskthethreequestionsinStep4everymonth.
Learntodefineyourtrueneeds.
Beconsciousinyourspending.
Masterthetechniquesofwisepurchasing.Researchvalue,qualityand
durability.
Why:
Youarespendingyourmostpreciouscommodityyourlifeenergy.Youhave
onlyafiniteamountleft.
Qualityoflifeoftengoesdownasstandardoflivinggoesup.
Thewealthweenjoytodayistheresultofcenturiesoffrugalityofmostofourcitizens.Frugalitymeans
wearetoenjoywhatwehave.Ifyouhavetendressesbutstillfeelyouhavenothingtowear,youare
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probablyaspendthrift.Butifyouhavetendressesandhaveenjoyedwearingthemforyears,youare
frugal.Wasteliesnotinthenumberofpossessionsbutinthefailuretoenjoythem.Step7:ValuingYour
LifeEnergyMaximizingIncomeRespectthelifeenergyyouareputtingintoyourjob.Money
issimplysomethingyoutradeyourlifeenergyfor.Tradeitwithpurposeandintegrityfor
increasedearnings.Howwellareyouusingyourenergybothonandoffthejob?Isyourjob
consuming(usingup,destroying,wasting)yourlife?Doyouloveyourlife,usingeachhouronand
offthejobwithcare?Ourfulfillmentashumanbeingsliesnotinourjobsbutinthewholepictureof
ourlivesinourinnersenseofwhatlifeisabout,ourconnectednesswithothers,andouryearningfor
meaningandpurpose.Youmayloveyourpaidemploymentoryoumayhateititdoesntmatter.Butyou
dontwanttorecognizethatthepurposeofyourpaidemploymentisgettingpaidandyourrealwork
maybefarbiggerthanthisonejob.Thereisnothinginyourlifethatismorevaluablethanyourtime.
Ageandaverageremaininglifeexpectancy
Averageremaininglifeexpectancy
Age
Years
Hours
20
56.3
493,526
25
51.6
452,326
30
46.9
411,125
35
42.2
369,925
40
37.6
329,601
45
33.0
289,278
50
28.6
250,708
55
24.4
213,890
60
20.5
179,703
65
16.9
148,145
70
13.6
119,218
75
10.7
93,796
Source:DatatakenfromUSNationalCentreforHealthStatistics,VitalStatisticsoftheUnited
States
How:
Askyourself:AmImakingalivingoradying?
Examineyourpurposesforpaidemployment.
Why:
YouhaveonlyXnumberofhoursleftinyourlife.Determinehowyouwantto
spendthoseremaininghours.
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spendthoseremaininghours.
Breakingthelinkbetweenwhoyouareandwhatyoudoforalivingwillfree
youtomakemorefulfillingchoices.
Checklist:ThinkBeforeYouSpend
Dontshop.
Livewithinyourmeans.
Takecareofwhatyouhave.
Wearitout.
Doityourself.
Anticipateyourneeds.
Researchvalue,quality,durability,andmultipleuse.
Getitforless.
Buyused.
Followthestepsofthisprogram.
Step8:CapitalAndTheCrossoverPointBydoingsteps1through7,youwillmovetowardsFI.With
Step8thepossibilityofFinancialIndependenceopensup.Step8showsyouhowyoucanperhapsleave
paidemploymentalotsoonerthatyouwouldhaveeverthoughtpossible.Whatyoushouldbegintosee
inyourwallchartisagrowinggapbetweenincomeandexpensesthatis,savings.BeforeFIthinking
takesover,anormalpersonmightregardthosesavingsasearmarkedforasplurge.ButFIthinking
seesthosesavingsinadifferentlight.FIthinkingcallsthatgapcapital.Capitalismoneythat
makesmoremoney.Itkeepsworkingforyouandproducesanincomeassurelyasyourjobproduces
income.Whenyouputcapitalinabankorotherinterestbearinginstrumentitisaninvestment.An
investmentistheconversionofcapitalintosomeformofwealthotherthancashwiththeexpectationof
derivingincome.Theincomeyoureceivefromyourcapitalofadifferentnaturethanyourjobincome.It
comesinwhetherornotyougotowork.Insteadofsimplylumpingitinwithyourtotalmonthlyincome,
youwillbeenteringitseparatelyonyourwallchartaccordingtotheformulagivenbelow.Eachmonth
applythefollowingequationtoyourtotalaccumulatedcapital,andpostthemonthly
independenceincomeasaseparatelineonyourWallChart:
capitalXcurrentlongterminterestrate12months
monthlyinvestmentincome
How:
Findthelongterminterestratebylookingattheinterestofthe30yeartreasury
bondsinthetreasurybondtableofTheWallStreetJournalorabigcity
newspaper.Afteranumberofmonthsontheprogram,yourtotalmonthly
expenselinewillhaveestablishedamuchsmallerzigzagpatternatamuch
lowerlevelthanwhenyoustarted.Withalightpencilline,projectthetotal
monthlyexpenselineintothefutureonyourchart.
OutsidetheUnitedStates,thisinformationcanbefoundinnationaldailynewspapers,andfinancial
websites.Forthisparticularsectionoftheprogram,andformoreinformation,pleaserefertothe
book.
Afteranumberofmonthsontheprogram,yourmonthlyinvestmentincome
linewillhavebeguntomoveupfromtheloweredgeofthechart.(Ifyouhave
actuallybeeninvestingthismoneyasoutlinedinStep9,thelinewill
becurvingupwardtheresultofthemagicofcompoundinterest.)Witha
lightpencilline,projectthemonthlyinvestmentincomeintothefuture.Atsome
pointinthefutureitwillcrossoverthetotalmonthlyexpensesline.Thatis
theCrossoverPoint.
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Why:
AttheCrossoverPointyouwillbefinanciallyindependent.Themonthlyincome
fromyourinvestmentcapitalwillbeequaltoyouractualmonthlyexpenses.
Youwillhaveenough.
Youroptionswillbewideopen.
Celebrate.
Step9:ManagingYourFinancesThefinalsteptofinancialindependence:becomeknowledgeableand
sophisticatedaboutlongtermincomeproducinginvestments.Investyourcapitalinsuchawayasto
provideanabsolutelysafeincome,sufficienttomeetyourbasicneedsfortherestofyourlife.Step9is
aboutempoweringyourselftomakewisefinancialchoices,andyourfirstlessoninvolveseducating
yourselfsoasnottofallpreytounscrupulousbrokers,financialplannersandsalespeoplewhowantto
putyouinallmannerofinvestmentvehiclesthatpayhandsomecommissions.Whetherwearedefining
financialindependenceasbeingoutofdebt,withenoughsavingstowithstandeconomicdownturns,
orasafullfledgedearlyretirementthatmakesitpossibletodevoteyourselffulltimetowhateveris
mostmeaningfultoyou,thefollowingcriteriadevelopedbyJoeDominguezapplytowhateveryoudo
withyourcapita(thougheachpersonwillweighteachcriteriadifferently)l:
1.Yourcapitalmustproduceincome.
2.Yourcapitalmustbeabsolutelysafe.
3.Yourcapitalmustbeintotallyliquidinvestment.youmustbeabletoconvertitintocashata
momentsnotice,tohandlesemergencies.
4.Yourcapitalmustnotbediminishedatthetimeofinvestmentbyunnecessarycommissions,or
otherexpenses.
5.Yourincomemustbeabsolutelysafe.
6.Yourincomemustnotfluctuate.Youmustknowexactlywhatyourincomewillbenextmonth,next
yearand20yearsfromnow.
7.Yourincomemustbepayabletoyou,incash,atregularintervals.
8.Yourincomemustnotbediminishedbycharges,managementfeesorredemptionfees.
9.Theinvestmentmustproducethisregular,fixedknownincomewithoutanyfurtherinvolvementor
expenseonyourpart.Itmustnotrequiremaintenance,management,geographicpresenceor
attentionduetoactsofGod.
How:
Empoweryourselftomakeyourowninvestmentdecisionsbynarrowingthe
focustothesafestnonspeculative,longdurationfixedincomesecurities,such
asUStreasurybondandUSgovernmentagencybonds(orotherconservative
investments).Tempertheprevailingirrationalfearsaboutinflationwithclear
thinkingandincreasedconsciousness.
StepNineintheUpdatedandRevisedforthe21stCenturyexpandsthe
criteriaforinvestingtoincludeveryconservativeandbalanceduseof
mutualfunds,realestateandotherinvestmentvehicles,thoughJoes
originalultraconservativeapproachisstillvalid.Indeed,peoplewho
followeditareunaffectedinlargepartbythecurrentrecession.
OutsidetheUnitedStates,thereareseveralsimilarlongterminvestment
opportunitiesthatcorrespondtotheprinciplesofthisprogram.
Cutouthighexpenses,feesandcommissionsofmiddlemenandpopularly
marketedinvestmentproducts.
Setupafinancialplanusingthethreepillars:
Capital:TheincomeproducingcoreofyourFinancialIndependence.Cushion:Enoughreadycash,
earningbankinterest,tocoversixmonthsofexpenses.Cache:Thesurplusfundsresultingfromyour
continuedpracticeoftheninesteps.Maybeusedtofinanceyourservicework,reinvestedtoproducean
endowmentfund,usedtoreplacehighcostitems,usedtocompensateforoccasionalinroadsof
inflation,givenaway,etc.Why:
Thereismoretolifethanninetofive.
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INCONCLUSIONYouarewellonyourwaytotakingbackthepoweryouhavegivenovertomoney
andtomoneyexperts.Youarereadytobecomeaconscientious,lovingandknowledgeablestewardof
yourlifeenergy.Ourgreatesthopeisthatyouwillapplythesestepstoyourownfinancesandapplyyour
lifeenergytothechallengesthatfaceourspeciesandourplanet.Wewishyougreatsuccess.
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