Will you ever have enough money?
I was a bit hesitant to write this piece, knowing full well that money is a prickly subject - but here goes.
I’ve been thinking about money a lot this week.
While poring through my meticulous budget spreadsheet for this year, I was pleasantly surprised to find that I’ve actually spent a lot less than I’d planned for. I sagged in my chair with relief.
Before taking the sabbatical, the idea of money - and lack thereof - was a background source of stress. With so many unknowns, a backdrop of economic turmoil and the small matter of a wedding to pay for in September, the idea of having no income for at least a year was daunting, to say the least. It was the reason I tried (unsuccessfully) to get a job here before I moved.
It was also daunting in part because, the older I get, the more I realise the true value of money.
Money buys freedom
Money doesn’t just buy things. It buys choices.
While my office job didn’t set my world on fire, it paid me enough to make choices that optimised my life outside of work. Take that course. Eat out every now and then. Go on the trip. Grab an Uber home. Leave the job while you look for a new one.
Money is the multi-purpose tool of life. It unlocks possibilities, and with that comes an implicit sense of freedom.
Anecdotal evidence and research says that money is also one of the largest sources of conflict within relationships. With so many connotations - power and agency, to name a few - wrapped up within it, it’s no wonder why.
On having a scarcity mindset
Despite the gift of financial stability over the last few years, I still worry about money sometimes, probably more than I should.
As someone with an anxious-leaning brain (as I’m sure many of us can relate), I tend to focus more on mitigating financial risk than taking bold swings.
Scarcity mindset: the fear of ‘lack’, the underlying belief that there is never enough to go around, leading to anxiety about loss. This results in mitigating risks, constantly weighing trade-offs, and trying to make optimal decisions to hold onto what you have. It can apply to everything, not just money.
In a highly uncertain world, our reptilian brains are driven by the need to acquire resources and to hoard, like Smaug in The Hobbit, in order to feel safe.
When you have a scarcity mindset, though, the amount of money you have will never feel like ‘enough’. Because that would mean that your nervous system finally feels safe - something that often runs deeper than just your bank balance.
I’m not even sure why I have a scarcity mindset. I grew up in a comfortable family. I worked and saved up my nest egg, but always had the safety net of my parents if things went to shit. I’m extremely privileged.
My working theory is that, if you’ve been lucky enough to have ‘money’ in your life, you can underestimate your ability to deal with not having it. The fear of lack can become overblown in your head.
Ultimately, scarcity mindset is rooted in anxiety, avoidance and lack of self-trust. But the underlying fear of losing what you have can also be a great driving force. It’s driven me to work hard and live frugally, with the rewards being choices and agency, and a sense of strength derived from financial independence.
I do wonder, though, if my frugal ways were less about being sensible than they were about gripping to a hollow sense of safety.
Increasing tolerance for risk
In my late twenties, I started to realise my aversion to big risk - financial or otherwise - was holding me back. When I understood that money sitting in basic bank accounts was actually depreciating in value, I knew I had to take control.
Over the last 2 years, I’ve educated myself about finances. I put my money in higher-yielding accounts. I started to invest. This year, I bit the bullet and took a sabbatical (by far my biggest financial risk to date).
Taking financial risks has gradually increased my tolerance for them - and given me the confidence to loosen my grip on money a little.
Things like putting a bit more in the investment pie. Buying a friend lunch. Purchasing a better moisturiser. Giving the Bolt driver a tip. Booking a Japanese head spa treatment (how indulgent!)
When I loosened my grip and stopped accounting for every single euro spent, the world didn’t explode. My bank account didn’t drain to zero like a videogame.
As long as I was consistent and reasonable with my everyday money habits, I could trust myself that everything was going to be alright - or at the very least, that I could figure it out.
Disclaimer: I want to caveat again that I’m in a very privileged position. I have savings and share costs with my partner, who has a good career in tech. We don’t have kids and are living our best DINK life right now. Change just a few of these variables and things could be very different.
Money isn’t everything - but it’s not nothing
I believe things like our health and relationships are way more important than money. But contrary to the Notorious B.I.G song, there’s a certain threshold where money can absolutely mean less problems.
For better or worse, our civilisation runs on money. There’s no getting around that - not unless you’re bankrolled by family, join a commune or go live off grid somewhere. Seeing as that doesn’t apply to most of us, money has to factor into the equation somewhere.
When trying to weigh up whether to stay in Lisbon for a few years, I keep circling back to the fact that living here will mean living with significantly less money (even if I do manage to find a job). That in itself isn’t an issue, due to the aforementioned simple lifestyle and the realisation that our everyday costs aren’t actually as much as I thought.
But the bottom line is that less money means fewer choices. It means compromising on things like neighbourhood and accommodation, both of which are important to us.
More importantly still, it means relying on my partner's income. The idea of being financially dependent on someone else gives me the willies for reasons that are clearly tied up with my sense of agency and, as a result, perceived ‘safety’ (it’s something I’m working on).
Shifting mindset
Money has become a bigger facet of my decision-making than it used to be. Probably because I’ve now experienced the freedom that having money can afford, and I find myself gripping to it, though perhaps not as tightly as I used to.
These days, I try to catch myself when I act from a scarcity mindset. Instead, I’m trying to shift towards an abundance mindset - the belief that you have enough, that there are plenty of opportunities and resources to go round, and that everything will work out just fine. Easier said than done, especially when we’re being told the economy’s on fire - but we persevere.
Money buys choices. When planning for the future or a big life change, maybe the starting point isn’t ‘how much money is enough?’ as much as it is: ‘what choices do I want to be able to make?’
From there begins the work of making it a reality - or as close to it as possible.
If you have any thoughts on this topic, I’d love to hear them! This piece was inspired by an article by Alex Petrakieva: How Much Money Is Actually Enough?
Until next time,
Rose :)