Where Does Your Time and Money Go?

This is a guest post by Robert, who lives in Calgary and works as a financial adviser. He is married, has three kids and plans to retire at age 35.  Robert and his wife then plan to return to school and become teachers, eventually living and working overseas.

Last week, we discussed the story of a couple who gave away almost all of their $11 million lottery winnings. It raises the question of why the couple bought lottery tickets in the first place. I’ve participated before in an office pool, but I haven’t ever bought a lottery ticket for myself. Mathematically, I don’t understand the attraction. But I heard an explanation that, for me, explained a lot: some people buy lottery tickets as a license to dream.

What would you do if you won the lottery? Let’s suppose that the prize is $11 million. How would that money change your life? Many people say that they would quit their job, travel, spend more time with family and probably eat out more often with friends. What strikes me about this type of fantasy is that it sounds suspiciously like retirement. Fortunately, retirement for most people won’t take $11 million. But aside from that, most people will quit their job, spend more time with family, travel and relax with friends.

My first conclusion is that there’s no need to buy a lottery ticket to dream. Planning for retirement provides an opportunity to dream the same dream. Granted, retirement planning is more expensive. Instead of costing $2 or $5 a week, it might take $50 or $200 a week. The dream is the same, but the odds of success improve significantly from 1 in 1,000,000 to 1 in 2 (taking into account that life is full of surprises).

The dreams that a person has for either lottery winnings or for retirement reveal something about that person. The things they would do, if there were no constraints in their life, are probably the things that make their life meaningful. And so it would be unfortunate to wait for either a lottery win or even retirement before creating meaning in your life. Which leads to my last question: why not start now to try and do some of the things you dream about?

I know from experience that it’s not so simple. Most of us have a bigger imagination than we can afford to indulge. And many of our constraints are unavoidable, such as children or time commitments or other responsibilities. Let’s look at a couple examples of how this might work. Travel can be both expensive and time consuming. I know a family who decided that they would have a long, exotic vacation every two (or more) years, while spending their other holidays much closer to home. This allowed them to save up, but also to travel to places they dreamed of without waiting to be old. Spending more time with family requires taking time from other responsibilities like work. Some people choose to take additional holidays, take a sabbatical or even reduce their work week to achieve this goal. This may reduce their income, but it allows them to enjoy their children while they are young, instead of waiting until the entire family is old.

When I worked for a summer in Switzerland, I met a man who took the Concorde as frequently as he could over to San Francisco. He chose the Concorde because of the speed, which allowed him to miss less work. I asked him, if he didn’t mind sharing, how he could afford it. He responded that he loved spending time in San Francisco and that it was a question of priorities. His priority was traveling (quickly) to the west coast of the U.S. My priority, right now, is financial independence, so that’s where my money goes. And if a person looks hard at where they spend their time and money, it will either reveal what their priorities are. (As an aside, it may also explain why they feel out-of-sync if their resources not committed to their priorities.)

Dreaming allows us to be honest about where our priorities should lie. Rearranging our time and money resources to support our true priorities develops a sense of meaning in our life. People whose priorities don’t align with their job may look to retire early, where those whose priorities do align with their job may never want to retire. Where do you spend your time and money, that’s meaningful to you? If you were to make a change, where would you prefer to spend more time and money, with the expectation that it would make you more content?

One thought on “Where Does Your Time and Money Go?”

  1. I’ve dropped my hours down at consulting jobs since achieving the magic (bare bones) FI number last year – and have also chosen to take a couple of months off at a time, either traveling or staying home. This seems like the sweet spot to me – the nest egg can pay for the needs and the extra work can pay for the wants. This year the wants that I value the most are travel, house cleaners and paying someone else to do a lot of my DIY/renovation jobs so I don’t have to DIY them.

    Then there’s also choosing not to go into work on a blustery day like today in Calgary with the consideration being not that I’m missing out on making a thousand bucks but that I really want to stay off the roads! 🙂

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