What’s your relationship or philosophy with money?

A life-changing shift to my approach has been to worry about absolute amounts rather than percentages. Saving $10 on a $20 item feels great but ultimately is the same thing as saving $10 on a $500 item (which feels like nothing).

I grew up lower middle class: never had to worry about not having a roof over my head, but there were times we were somewhat food insecure, and spending money on leisure/entertainment or anything unnecessary for survival was a foreign concept until I got to high school and some my parents’ career moves paid off and put us in upper middle class. It took them a good 10+ years before they could relax a little bit and feel secure with their money, though, and that was as much driven by the fact that their kids were adults who had moved out.

So life has been about deciding which of my parents’ frugal attitudes and approaches to money to keep and which to discard.

Things I decided not to adopt:

• I slowly learned to stop caring as much about wasted food. Food is just cheaper now compared to when I was growing up (even if the last 5 years has shown an uptick), and as a society we have more issues with obesity than hunger, so cleaning off a plate seems like it doesn’t actually do that much good.
• My time is worth something to me. I will gladly pay the few dollars here and there for convenience.
• I’m glad I ignored my parents advice to buy a home as soon as I could and build equity or whatever. I rented and it worked out great for me, giving me the flexibility to make changes at different stages of my life.

Things I kept:

• Life is uncertain. Always be prepared with whatever you can accumulate for financial resilience: cash, other property, lines of credit, marketable job skills, literal insurance policies, etc. Don’t underestimate the importance of personal relationships, whether it’s “credit” from friends and family who can help you out of a bind, colleagues who can refer work to you, bosses who will fight for your career, etc.
• Develop your career. Education and credentials are important early on, and up-to-date skills and a good understanding of the landscape in your field (both in the type of job and the type of industry you work in), plus solid relationships with people, can help you know when switching jobs is right for you.

Things I had to learn on my own:

• Life is unfair. Many types of unfairness are systematic. So why not position yourself to where the unfairness works in your favor, if available?
• Higher income makes it easier to survive mistakes on the spending side. To flip around Ben Franklin’s quote, a penny earned is a penny saved.
• Know yourself and your own laziness. Set up automatic functions wherever possible: automatic bill pay, automatic savings, automatic investments, etc. Steer away from any strategy that requires active management, and towards strategies that tend towards a set it and forget it philosophy.

I’ve also made a shitload of mistakes, some of them pretty costly, especially back in my 20’s:

• Paid probably thousands in credit card interest in my early 20’s chasing lifestyle bullshit.
• Paid thousands in unnecessary car loan interest in my mid 20’s by getting suckered by a dealer.
• Paid hundreds, maybe thousands, in late fees and interest from forgetting deadlines to pay shit I actually already had the money on hand for.

I’m rich now, most of it from luck (especially timing), much of it from personal relationships (good family, good marriage, good friends), some of it from actual effort (good grades from a good law school), and some of it from conscious decisions to steer towards my strengths and away from my weaknesses (lazy but smart, prototypical “gifted” slacker with undiagnosed ADHD).

It took a while to get here, though, and I was financially insecure well into my 30’s. Sorta figured shit out then, and then married someone who complements me pretty well on these things, and covers my blind spots.

For the extra brave ones: how much savings do you have, and what are you planning to do with them?

I have some savings, and it’s an emergency fund. It’s representing 1-2 months of typical spending, that could be stretched to 3-4 months if I needed to stop the frivolous spending. But I have credit beyond that, and less liquid assets I’d be able to tap into if I were facing a longer term issue.

But I’m not saving for any particular thing other than retirement. If things accumulate and grow, great. I’ll make a judgment call on when to retire based on how I feel and how much I have and what I want to do. I anticipate my wife and I will probably want to retire in our early 60’s, based on our anticipated career trajectories and the ages of our children.