Does anyone remember this great definition of money from the authors of the classic book Your Money or Your Life (Joe Dominguez and Vicki Robin, 1992)? 
I bought this book about four years ago, read it, quickly forgot about it. I’ve picked it up again recently by a chance browsing through my local library. I think I like it even more this time. And I realize that this is the concept that I was trying to move towards in calling my blog MoneyEnergy.
Dominguez and Robin say that the “one consistently true statement we can make about money that will allow us to be clear, masterful and powerful in our relationship with it” is the idea that
“money is something we choose to trade our life energy for.”
“Our life energy is our allotment of time here on earth, the hours of precious life available to us. When we go to our jobs we are trading our life energy for money. This truth, while simple, is profound… Life energy is all we have. It is precious because it is limited and irretrievable and because our choices about how we use it express the meaning and purpose of our time here on earth” (54-55).
So I just made a list of all the jobs I can remember having done so far in my life. It’s an interesting exercise if you let it see where it takes you. I’ve had many different types of jobs, many of which I felt were frustrating and/or unimportant at the time. It presents an interesting picture of what I’ve traded my life energy for. I see now that in many of the cases, if I remember how I took a certain job, I was often doing it based on what was convenient or easy or what just happened to “fit” at the time. I’m much more conscious of what I will trade my waking hours for now.
Most of us buy money with our time. We put actual hours in at work. We trade our time – our life energy – for the pieces of paper and coins we call money. What will you use this money for? It should represent a fair trade on your waking life. Are you squandering away your waking life? Does your life energy dissipate – so that you don’t know where it all goes?
The authors have a complex 9-step plan for becoming more conscious of and controlling your life energy. But here are two simple steps: record every cent that comes into your life, and every cent that leaves your life. Do this at least for one month so that you can clearly see where your life energy is going. Does it represent what you really want to do with your life? Is this what your life should be traded for?
The other exercise is to calculate the actual amount of $ you earn from your job and turn it into a dollar per hour amount. Include the time it takes you to get ready for work, to “relax” after work, to shop for clothes to wear to work, etc. etc. This will be your “real” salary, what you’re really trading your life energy for. You might see now that it’s even more important to be sure that you’re giving up your life for what it’s really worth.
What do you think? Have you read this book? Do you have similar thoughts or solutions?
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This is perhaps the best book on personal finance. Everyone should read it. Great article.
Really great article, a real eye – opener. Gonna visit Amazon to order this book, got an affiliate link ? :)
You bet, just click on the book image in the post. Thanks!
This article is very timely for me and my 16 yr. old son. He just started working for us some (we have a small business). His first pay was $100.00. He, of course, was thrilled and thought he was rich. Most the kids he knows are stockers at stores or working some fast food jobs. He had a lot of questions. I was bringing up many of the points to him that you are manking here. I really wanted him to begin to think through work life in a serious way whether he worked with us or soemone else. I’m emailing him the link to this article (even though he’s in the other part of the house- LOL- were techies for sure) and see if he’d like to go halves on the book you recommended. We’ll buy it through your link. Glad to know about your site. I’ll explore it more.
Thanks Cy. I’m glad you think it might interest your son! I’d love to hear about the developments. If you can even get him just saving the 10% now; that’s a good enough lesson at his age, I think… or show him how he can earn more through dividends. It’s always nice to see that paycheck. It could be very motivating for a child or teen, too.
Ah, I was wondering where the blog title came from! :) On the topic of the post, as well as thinking about the time and life energy being swapped for money, you can think about the life energy being swapped for ’stuff’ too (via money).
For example, was paying the premium for a new car versus a one-year old model by trading six months of your precious never-to-be-recaptured life really worth it? (Never, I’d say!)
Yes – as Chris Guillebeau tweeted recently, “ask yourself what you traded your life for today.” That just about says it!
My son-in-law turned me onto your site a while back. When I came across this, it reminded me that I had read Joe and Robin’s book 20 years ago.. It has had a profound influence on how I view money and work ever since. I bought several copies and made all my six kids read it. Hard to tell if it takes, but at least they are exposed to his ideas. I don’t know how you get to his ending place, but most of us need to just step back from this insane consumption and get a life. Everyone should read this book and take from it what they can at their station on the journey.