Learn to control money but do not allow it to control you

Firewalker

Yep, I did it. We have been in this house for eighteen years and I don’t think the neighbours have seen me in the garden doing things even once. Or maybe once, but this is it. And today I swept the dead blossom from the magnolia and all that goes with it. There is hope yet. Feels great – but at the same time not as surprised as I would have been couple of months ago. Just one more thing that I am doing now – and trying to enjoy it – that very recently would have been classed as ‘pointless’, ‘impossible’ or ‘improbable’.

Heat really prevents analysis; in fact heat probably reduces any form of reasoned thinking. But it is very for dreaming, for leaving with your memories. So I have been remembering my parents when they were young, the way they lived, their achievements and their mistakes.

I don’t believe my parents were poor – if anything they were quite well off. My Dad was an officer in the army, my mum did variety of things and her greatest regret was that she did not ‘have education’. This meant that she had to leave school at 15 and after that every time she was about to get a certificate (for the next level of her education) some major life event happened and it all fell through. Despite that she was a very bright, clever and cultured person who read all her life and wrote like a dream – I still keep her letters and read them when things really go wrong or when I need to connect with her.
My parents were never poor but we hardly ever spend anything on ‘luxuries’ – they always saved: to buy their home, to help their children, for their old age, for security...We never went on holidays – if one does not count the annual trip to my grand-parents’ place in the country. I don’t think that my parents were ever broke either – until much later this is...

What were their major achievements? I think their children – they invested in us and supported us in many different ways. I always admire the way in which they gave me enough space to grow up and experiment while being nearby so I always felt secure. They kept my sister to study and kept me to go to university and beyond...

What was their major mistake? Surprisingly enough saving was probably their biggest mistake. When they were younger they never lived – and the ‘work hard, don’t play around’ programme is in me as well. They bought their home (good), managed to help my sister (splendid) and had some money saved for me and for their old age (hopeless). Their savings were completely wiped out in the early 1990s. And you know what? My Dad thought that having savings is safe, that this is good. In 1987 I asked him whether he has any money saved and his reply was ‘there is enough for an apartment for you’. Hearing this I urged him to spend the money on gold, land whatever, just not to keep it in the bank. He never listened. The result: instead of an apartment the money my parents saved for me bought three ice-creams.

And of course their savings for old age melted as well so having saved all their lives they were broke. Have been helping them for the last twenty years or so and will continue to do so.

But this makes me think – are savings worth it?

Firewalker

Firewalker

This has become one very visually sharp website – well done to all involved.

This morning I ended my post with a question – are savings worth it? And having given myself time to reflect while cycling around the answer would have to be ‘mostly not’. In other words, saving for specific things or even keeping a bit of a cushion is probably not a bad idea but having considerable amount of savings stashed away in a bank is not the thing to do. Why, you might ask?

I would like to approach answering this question by reflecting first on the reasons why do we save. And I don’t know about you but I want(ed) to have savings because this gives me a sense of security – if the going gets tough I want to know that there is something to get me through. But do savings really make one safe and secure? Remember my Mexican hostess? She lost her life savings in the credit crunch. Remember my parents? They lost all their savings in the crisis in Eastern Europe in the early 1990s. How many people had their savings in shares? And what happened to these shares during the last three years?

The first reason why having large savings is probably not such a good idea is that although we equate having savings with being secure, this is a false sense of security. This leads me promptly to the second reason – having substantial savings means putting one’s trust in the banks. There is absolutely no reason to trust the banks and there has never been one. The third reason is a less straight forward. Money is valuable either when it is used as ‘a universal mediator’ or when it circulates. In other words, money matters either because of the things it can buy us or because it circulates in the economy and makes more money. Thus keeping it in savings accounts makes it pointless apart from the sense of security it gives.

There is also always the matter of what we buy. Do we buy possessions or do we buy experiences? Thinking back I wish I did not tell my Dad to buy gold, land or property. I wish I told him to take my Mum on a cruise – she would have loved it. He would have not listened anyway.

Firewalker

joshua_blue

Hi Firewalker

Just popped in to say I agree totally with your post about savings

Firewalker

I didn’t write yesterday –too busy and tired, I felt. But have missed doing it and have been thinking about the importance of our core values and more specifically whether these are ‘materialistic’ or ‘spiritual’. Here I am using ‘materialistic’ and ‘spiritual’ fairly broadly and the former refers to ‘people to have’ and the latter to ‘people to be’. These two groups are very different in a number of ways, like what do they want and buy, what motivates them, what underpins the choices they make, how they relate to others etc. Naturally, whether one is a predominantly ‘materialistic’ or predominantly ‘spiritual’ person would affect greatly the way one deals with matters of money, debt, and finance more generally. And realising this is not about passing judgement – but aligning one’s values, one’s wants and one’s behaviour.

For example, predominantly materialistic people buy ‘things’ and possession is very important. Possession also motivates them – put somewhat differently they would be prepared to walk to work, or cycle everywhere, or not go on holiday just to get this suit, this ring, this pair of shoes. Usually these are also the people who are ‘outcome’ oriented – they can put up with a lot of pain and discomfort to achieve particular outcome. I suspect Machiavelli was a ‘materialistic’ person if he claimed that ‘The end justifies the means’.

Predominantly ‘spiritual’ people have a problem accepting that ‘the end justifies the means’. They crave happenings rather than possessions. Even more interestingly, they are very likely to need something more than saving money to justify walking, or cycling, or even not going on holiday. Instead of ‘cycling to work saves me £5 per day which I can spend on X’ these are the people likely to think ‘cycling to work keeps me fit and saves the planet; or and by the way I also save all this money’.

But more importantly, these two groups of people are likely to relate to the ‘outside’ differently in times of financial pressure. Predominantly ‘materialistic’ people are likely to start closing and looking more inside themselves or a unit while the ‘spiritual’ people are likely to be more outward looking.

I have come to the conclusion that although I have managed to amass considerable amount of possessions, possession of things does not interest me. If I allow myself to think that I am cycling around to save for something it is likely I am not going to last even a week. What keeps me going is the multitude of displacements I am perfecting. I cycle because it keeps me fit and because when we run out of petrol I’ll be prepared. I cook because it is healthier for us. I do the weekly accounts because it is good to know. And so on...This is why, when I get rid of this debt I am going on a motorcycle across America – with little boy behind me and OH in a Cadillac following.

I am going to Barcelona tomorrow and will be away till the weekend. And the saying for today is

“He who has a why to live can bear almost any how” – Friedrich Nietzsche

Firewalker

savingwannabe

Firewalker your wisdom is as usual much appreciated. Enjoy Barcelona. Life is amazing journey, well it has been today!

Firewalker

Good evening from busy Barcelona. Oh, the day I have had...It all started early(ish) this morning. All seemed well, did not over-sleep, OH gave me a lift to the airport, had smooth journey. Once at the airport I though that it will all be a breeze – I had already checked in so straight to the gates. Little did I know – and with all the travelling I do I should really know better.

You know how we are all expected to put all our liquids in a plastic bag? Well, this morning I decided that since all my liquids (all three containers of them) were in my transparent bag they can go through and save me having to bother with a bag. But no – the choice was either buy a plastic bag for £1 or my moisturiser goes in the bin. I bought a bag but felt really cross...

After that I was gallivanting through the airport in the rough direction of my gate. Suddenly the red message saying ‘Flight closing’ came on. Lord, how I ran – like the wind. If I ever sprint like that when doing a race I would probably finally win. At the gate there was a long line and it was quite obviously not closing. But eventually I was in my seat and the exercise was good...And then the announcement came.

‘Dear passengers, as you know the French air-traffic controllers are on strike so we have been given a slot in about 1h 30 min time.’

Instead of arriving in Barcelona at 11.20 and going to the see some Miro pictures, I arrived at 13.30. Anyway, after that all was lovely – went on one of this open buses and saw parts of the city I have not seen before. It is breathtaking in a very large city kind of way – very different from Granada which blew me away the first time I saw it.

But this whole experience makes me think that travelling is so much not worth it anymore. I still remember the time when travelling by air meant that one was valued, helped and supported. Now passengers are not valued any longer – we have become the enemy. And if we are the enemy it is a war – so passing through an airport is a ritual humiliation.

Firewalker

savingwannabe

Travel my pet opens the mind. The journey consists of travelling by plane, ship and car but also fantastic experiences once you arrive and often when you travel although like you said, not always. Don't let a bad experience put you off. The world is an amazing place. Keep enjoying it dear Firewalker.

My favourite beginning to a book is by John Steinbeck, Travels with Charley. We are so lucky to have the opportunity and the infrastructure to see so much. Soon we can fly to the moon. Life is amazing. Have a fab break there. Have you been back to Gaudi's Cathedral? I loved it but it was a long time ago?

hugs, SW

savingwannabe

http://www.amazon.com/Travels-Charley-America-Twentieth-Century-Classics/dp/0140187413#reader_0140187413

I am sure you know it but some reader's may not and it is the most amazing beginning to a book i have ever read. I cannot sleep I hope you don't mind me posting it. Mr Steinbeck is one of my heroes.

Firewalker

Absolutely right, Savingwannabe. Once here, Barcelona is great. The weather is also amazing – bright and sunny but not too hot. And yes, I did go on an open bus trip with my colleague yesterday and we saw the Gaudi cathedral again. We also passed around one of the houses build by Gaudi – took a picture and might try and post it when back.

Generally having a good time here – sitting in a meeting all day today and having to talk to loads of highly political people during the coffee breaks was a bit of a downer but this is why I am here. Oh, OK. I found the meeting rather interesting from research point of view and having dinner in a really wonderful Catalonian restaurant more than compensated for having to talk to people. The food was so nice that I am going to be really surprised if I have lost any weight this week. Have not been for a run here either.

Now bed and tomorrow travelling back. Can’t wait to hug little boy, two young men (son number 2 is back from university) and one middle aged one.

Firewalker

Firewalker

I am back – after a smooth and uneventful journey. When I left Barcelona it was a bright day, the sun was shining, the sky was the colour of Elizabeth Taylor’s eyes and the temperature was 24C. When I landed in Manchester the sun was nowhere to be seen, the sky was grey and the temperature was 11C. On the bright side, it was not raining.

I have been feeling a little downcast these past few days. It seems to me that I have found myself on the dark side of the ‘coping with financial problems’ universe. Nothing has happened really except that I have again this feeling of helplessness and inadequacy. Dealing with large dept is like running a marathon: one ought to expect constant low level pain and suffering over a very long time. And just like when running a marathon, re-paying large debt can be divided into different stages. To begin with there is the start, when one is still fresh and determined so springing along is rather pleasant. After that there is a stage when tiredness sets in but the finish is too far – this is the most difficult stage and many drop out. The third stage is when pain and the realisation that this is really hard takes over - but it is too late to give up. And finally, there is the stretch to the finish and everything hurts, and energy is so low that simply blinking takes couple of minutes. But one can smell the finish; feel the rush of glory when crossing the line and running is easy.

I suppose I am just entering the second stage – I start feeling really tired and motivation does not come easy. Trying to sprint – which is a catastrophe in long distance running – is very tempting. Or just give up...

I have always finished the marathons I run – it just feels hard. Or I might just be tired and after a long sleep will find my-self at stage one again, joyfully springing towards the finish.

Firewalker