Ronin of the Spirit

Because reality is beautiful.

The big trick

Well, its another day. I still feel like I did yesterday, that is ridiculously happy and mildly alty. Its just fun to know where I am going after so many years. Wife and I are developing our ridiculous theory of how to succeed while doing as little as possible. After a few years when we are sure it works we are going to sell a book on it, its the sort of thing people want to know.
Here for you, patient reader, is my amazing system of wealth generation.

Humans have 4 basic needs.
(1.) Food
(2.) Clothing
(3.) Shelter
(4.) Partnership
And one big want: Play

Money is what we exchange for our time. We spend money/time to procure these things. I know the last one is sort of different for many people, but it is in fact a need. Most people try to achieve these 4 things through work. Work gives them the money which they spend on food, clothing, and shelter. They get their need for partnership met through the people they work with. God never promises easy life, so it shouldn’t realy shock anyone that we have to work to live. The problem is this: the vast vast portion of the incredible wealth that our society allows us to have is squandered either to get more money or to entertain us and make us feel better about not having enough money.
For instance (1.) Food. We work so we don’t have the time to raise our own food. We drive to the store, which takes our time. We buy the food, whose cost is controlled largely by how much it cost to transport. When we spend money we are really spending time. If I make $15/hr, every $15 of food I buy represents an hour of my life. If I spend 20min getting to the store 1 hr 20min in the store and 20min getting home, thats 2 hours. If I bought $60 worth of food (4 hrs) Then my little trip to the store just cost me 6 hours. Wow, maybe I could have a garden after all, if I spend 6 hours a week in the procurement of food anyway.
(2.) Clothing. What would I wear if I never had to wear clothes just for work (ok this doesn’t really apply to me, I wear AF BDUs but you know what I mean.) If I could just buy clothes for
me what would I wear? I have 3 kinds of clothes: casual, semi-formal, and formal. I have different ties and shoes for each set. What if I could just wear what I wanted, how much less would I spend?
(3) If I owned my own place, really owned it, paid off in full, how much money would I save? And why don’t I own my own place? Well, because I have to move a lot. Why? For work. See what I am saying, yes employment provides us with income but how much is it costing us? If I never had to buy gas to get to work, how much less gas/milage would go into my car? Would I even need a car?
(4.) Partnership. This is what meets our emotional needs. If we live on a desert island and we have no people to partner with, we partner with nature. It is the act of partnership that brings us the most and deepest satisfaction. The inverse of partnership is exploitation. The funny thing about exploitation is that it is as bad for the exploiter as the exploited. It is what a pastor I once knew called an illegal relationship. It corrupts. If a farmer exploits rather than partners with his land soon neither he nor his land will have anything, but partnership is what can make all participants wealthy. Exploitation bankrupts both sooner than later.
Noticeably absent from this list is Entertainment. Entertainment is what we do when number 4 is not being met. We entertain ourselves to distract us from a need not being met. I know some of my readers will freak out here and say “There is nothing wrong with having fun! All mammalian species practice non-survival essential behavior, usually defined as play!”
And you’re right. Play and entertainment are not interchangeable, however. Play is an active and creative process. Play may be story or toy driven (or both) but both involve active thought and or body movement. Entertainment, conversely, is passive and non-creative. Play flows from the mind out into the world. Entertainment flows from outside the mind and inward. Interestingly enough, leading research suggests that the more time people spend in play, such as making sculpture the happier they are. The more time they spend watching TV the less happy they are.
So all the above is including in our investment strategy. An investment strategy is how you chose to spend your life. EVERYONE has an investment strategy. Some people have poor ones, but everybody has one. (If you spend all your money on wine, women and song, for instance, that is a very poor and short term investment strategy, but it is one never the less.) Ours in based around the ideas above. We spend to buy ownership of those 4 things, so that any income we get can go into play.
Ownership is the other big principal we are shooting for. Our society focuses a lot on owning, but doesn’t really teach you what to own. Houses are a favorite. Most often called an investment, they aren’t nearly the investment most people make them out to be. If you take the value of a house and subtract all the ownership expenses (Property tax, loan interest, fire insurance, utility cost [ie how much more do the utilities cost for a single family home verses an apartment of the same square footage in the same area. Houses always use more.] increased milage/depreciation on car because house is farther from necessary exchanges such as work and markets) The house will still sell for boatload more money than you spent to get it. Until you factor in inflation. Then the gain on most houses is about 1%-3% compounded quarterly.
So, in case this somehow unclear, if 2 men both have the same amount of money to spend a month, and one gets a house for $150,000 and the other gets a $75,000 house and invests the remaining monthly income into savings bonds (on investment medium not exactly famous for high return). At the end of 5 years (or 10, 0r 30 etc.) the man with the cheap house will have significantly more money. (Yearly he is only getting 1.8%-3.8%, but that addition 0.8% interest is made more potent by the magic of compound interest. If he invested it in a good mutual fund (Like a Vanguard S&P Index) He wouldn’t be getting 3.8% he’d be getting 8.0%.
So, I am all for ownership, but just make sure that you are buying things that generate income.
Anyway, I have to save some secrets for the book, and this is long already.

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February 26, 2007 - Posted by | Uncategorized

2 Comments »

  1. 2 cents – I think it’s hard for people to sacrifice for the short term to be happier and prosper in the long term. People want their nice cars, their nice homes, the newest clothes… It’s hard to “put aside worldly things”. Sometimes it’s all about an image too, not that it is right, but some people only care about what kind of car they can say they drive, or what neighborhood they live in… End 2 cents…

    Comment by Anonymous | February 27, 2007 | Reply

  2. The happiest I have ever been, that your Mom and I have been as a couple, was when we had the least money.

    Comment by RiverRatRanger | February 28, 2007 | Reply


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