I've never really viewed it as saving money. I view it as purchasing independence, and I don't view it as delayed gratification. I view it as pleasure right now. I think most wealthier people are not necessarily happier than less wealthy people, but I think they have fewer bad days. I think no matter how you're living, what people really value is a simple life, an uncomplicated life, because that is almost a prerequisite to independence.
People say that money is the root of all evil, but really it's your feelings about money that are the root of that evil inside of yourself.
Happiness is always, for everybody, a five-minute emotion. Almost nobody is ever happy for more than five minutes. In a similar way that if you hear the funniest joke in the world, you don't laugh for seven years, you laugh for thirty seconds. I think the emotion that you want to chase with money is not happiness, because that's something you're never going to achieve. It's contentment. It's getting to a point where you say, 'I'm good.'
This isn't your average business podcast, and he's not your average host. This is the James Alterer Show.
Morgan, I have so much enjoyed your books. The Psychology of Money was almost, for me, almost a book about me on the bad side and then turning into me on the good side. Like I had to learn the hard way the incredibly valuable lessons of that book. And for me, I'm not a big spender. So, The Art of Spending Money, I really appreciate the advice right from the beginning. I think it's incredibly valuable advice that everyone should follow. And you know, it seems like the crux of it is that you're saying a lot of people spend money based on the perception they want others to have of them. Like, 'Oh, I'm rich, so I have a yacht,' or, you know, and so on. And so it's almost like trying to get people to admire and or be jealous of you, and that's the reason they spend money, as opposed to spending money on things that they actually need, like freedom and independence. Would that be a little bit of a summary?
Yeah, I think, James, that's a pretty good summary. What is hard about all these topics in money, whether it is investing or earning or saving or spending, is that almost nothing is universal. And so it is absolutely true that a lot of people, a lot of the time, use their money as a social signaling mechanism. It's not true for everybody, though, and it's not true for everybody all of the time. It's true for almost everybody at various points of time. And what's also true is that when we are using our money to socially signal, we almost always overestimate the admiration and attention that we're going to get from it. So it is one of the biggest kind of psychological traps and flaws that you can see people engaging in with their money. I do this as well. I'm sure you've done it. It's a very human thing to do. I think life at its core is a competition for resources. That is kind of like the base of the pyramid. Kind of like a hard thing to admit, but for a lot of things it is a competition for attention, for jobs, for resources, for mates, whatever it might be. And so we are always engaging in some kind of signaling, and the material signaling is like a relatively new way to do it, living in a world of kind of relative material abundance that didn't exist for most of human history. And I think because of that, we have a very flawed sense of what it is going to do for us.
Yeah, I always think there's three skills of money. There's making it, keeping it, growing it. And each one of those skills requires a different type of psychology. Like making it, at least on an entrepreneurship level, requires this incredible grind 24 hours a day, this, you know, one focused thinking. But then keeping it is more about what you talk about in The Psychology of Money and The Art of Spending Money. You have to understand, you have to value your independence. Like I like how you put it in The Art of Spending Money, you have to spend generously on your independence as opposed to on just objects that people are going to admire. And you know, growing it is a whole different thing, but that's maybe your next book. I don't know.
Yeah. I mean, the way I think about it, James, is that I look—I've always been a big saver for my whole life. It sounds like you have as well. But I've never really viewed it as saving money. I view it as purchasing independence. I view that if I save $100, I just bought a $100 independence claim check. That's really how I view it. And I also don't view it as delayed gratification. If I save $100 today, I'm $100 more independent today. And that gives me a good feeling today. I'm not delaying any kind of gratification with this. I love waking up with a sense of independence that I can do whatever I want today, with whomever I want, for as long as I want. Even if most days what I want to do is wake up and work, but I'm doing it on my terms. And also with the sense of recognizing and being cognizant of how fragile the world is, to your individual life and for the broader world economy, and that life is just a continuous chain of surprises and setbacks and recessions and pandemics and bear markets. And the more savings you have, the more independent you are, the higher your ability to endure those setbacks. That gives me pleasure right now, today. And so I don't view it as saving money. I view it as purchasing independence. And I don't view it as delayed gratification. I view it as pleasure right now.
I think that is a great way to look at it, and honestly, I haven't looked at it that way in the past. I've viewed saving money often—I've viewed it as wasting money. But you're right, because like I think of times like in the year 2000, I would say I had a lot more money than I had in the year, let's call it, 2010. So 10 years later, and yet I was much happier in 2010 than I was in the year 2000 because I wasn't spending nearly as much money. The idea of independence is that's the only thing you can really put a value on in life, I feel, because like you point out in The Art of Spending Money, not that many other things have a consistent static value. Like a yacht is maybe worth it to you the day you buy it, but then it's worth nothing to you a few months later. Whereas independence means you can wake up and do the things you want to do every day. That remains consistent.
Yeah. And I think for a lot of these things too, it's not necessarily that a lot of these things that you purchase, whether it is a yacht or your independence, will give you happiness per se. That's usually the wrong emotion that people are trying to chase, but it gives you a greater sense of contentment and calm. Here's one way to think about this. I think most wealthier people are not necessarily happier than less wealthy people, but I think they have fewer bad days. I don't think they have more good days. I think they have fewer bad days. And that is a lifestyle improvement. That is worth chasing. That is a great thing, but it's not necessarily happiness. Like most wealthy people do not wake up every morning grinning ear to ear, as you might assume when you are a poorer person anticipating what that life might be like. So the emotions that we can get from it are absolutely a lifestyle improvement. It's just maybe not exactly what you think it's going to be when you're dreaming about it. You brought up a very good point, too. That first chapter of The Art of Spending Money, I called 'The Quest for the Simple Life,' which is the title of a book that was written in the early 1900s. And it makes this point that, you know, you can live an extravagant life. You can have the mansion and the yacht and the fancy cars, whatever you want to do. Everyone's different. Do your own thing. But I think no matter how you're living, what people really value is a simple life, an uncomplicated life, because that is almost a prerequisite to independence. It's hard to be independent if you have a very complicated life with a lot of moving parts. And Warren Buffett, many, many years ago, made this joke, as he often does. He makes kind of sexual, like, inappropriate jokes. Someone asked him why he doesn't have a yacht. And he was like, 'Well, if I get a yacht, I need a yacht boy.' And then my wife might start, you know, looking at the yacht boy. And then—and it's like your life gets very complicated at that point. And so the book is not a plea to be super frugal. And I don't think that I am. My wife and I spend a fair amount of money on things that we really enjoy, most of which is independence, but a lot of material things as well. But no matter what kind of lifestyle you choose to live, the simple life is one that is the almost universal emotion that people want.
It's true. Although like one time I had a period in my life for several years where I threw out all my belongings and I was just living out of one backpack. I had a rule: if it couldn't fit in my backpack, I didn't own it, and I didn't want to rent and I didn't want to own. So I lived from Airbnb to Airbnb, and I would say it was one of the happier times of my life, and it was a very simple life to some extent. But sometimes it's actually expensive to live a simple life.
Yeah, like having no belongings cost me money in a weird way, you know, because Airbnbs cost money. Now maybe I saved on furniture and maintenance and utilities and all that kind of stuff, but it's unclear whether I actually saved money having a simpler life, although it was pleasant.
But actually spending less, living in a smaller place, you know, living outside of a big city, so having more access to nature, which I did from 2010 to 2015, actually did give me joy, regardless of what my financial levels were at that time, which varied quite a bit during those five years.
Yeah. One other point that I think about here is there's a really good book written by Harvey Firestone, who started Firestone Tires in the early 1900s. He wrote his biography in, I think, 1926. So that's when this is dated. And he talks about every single rich person he knows, the first thing they do when they make a lot of money is they buy a gigantic mansion. They go out and buy a 30,000-square-foot mansion. And he said every single one of them, without exception, views it as a giant pain in the ass. That's not how he phrased it, but that's the point. Because the upkeep on that and the staff that you need to keep that going makes your life very complicated. And then so he and his wife were daydreaming about when they were happier, when they used to live in the tiny little cottage versus the big mansion that he now had. And he said, 'So why can't we go back?' Like, of course, of course we can go back to the small cottage. And he had a quote that I loved. He said, 'There is no going back except as a broken man.' As in, like he was sitting there in his big mansion, he realized that his simpler life was better, that he was happier back then, but you can't go back psychologically. Like the house was a scorecard of what he had accomplished in life, and to go back to the small house meant that he was like giving up his trophy. And so one takeaway that I think about here with that is like be very careful the lifestyle that you pick, because by and large people can only go one way. Now what you've just talked about might be a counter to that, somewhat of an exception to that sense, like you had a bigger life and then you got very simple. But by and large, people do not like downgrades. The psychology of downgrading your lifestyle is vicious. It is very difficult for people to endure. And so all these people who chose the big life, the billionaire life back then, and looked back and said, 'My life is so complicated. I just wanted simplicity, but I can't go back.' And that was always a very interesting anecdote to me.
Yeah. You point out in the book he even mentions further that he says even Henry Ford got a big mansion, you know, and Henry Ford's considered to be a very simple man, or wanted to have simple needs, but...
I think that was a good thing to mention in your book because then it forces the reader—it forced me to think to myself, can I go backwards? Like I live in a nice place right now. Would I be able to move into a studio apartment if I thought, 'Oh, that was the years I was happiest when I lived in a studio apartment'? And I think the answer is no. I think you can't go back. It would be hard.
Right. It's very difficult. And I think what this gets down to is: are your possessions utility or status? Are they giving you utility in life, or are they status? And when I say status, I don't just mean it to signal to other people. A lot of status is internal. It's a reminder to yourself of what you've overcome. And so when I say status, you might think, 'I'm not trying to show off to other people. I don't care what anyone thinks of my house. They don't even see my condo. They don't even know.' It's status for yourself, though. It is a scorecard in your own head of what you have accomplished. And if you go back to the smaller place in your own head, it's like you don't have to care what anyone else thinks. In your own head, you feel like you've taken a step back. And that's very difficult to deal with.
Yeah, that's so interesting. And well, this is related to both books because The Psychology of Money deals a lot with this. And I have just a classic story that would be classic in your Psychology of Money, which is one time I was so anxious about losing money. And of course, when you have no money, you could be happy. I had no money my whole life. I was super happy, super driven. Then I got money and then I lost it. And of course, I was in the worst misery of my entire life. And I was so anxious I went to a psychiatrist and he's like, 'How can I help you?' And I said, 'Honestly, the only way you could help me is if you write me a check right now for a million dollars.' And he said, 'Well, I honestly don't think that's going to help you.' And of course, he was right. And that's the whole point of The Psychology of Money, that it's not money itself. It's something internal that's happening. People say that money is the root of all evil, but really it's your feelings about money that are the root of that evil inside of yourself. And how, other than reading your books and kind of really trying to incorporate your advice, how do you build up a good psychology of money and spending and so on?
I wish there was a simple formula that I could give you or a simple five-step program or whatever. I think for me, what's been most helpful is really trying to get on this therapist-couch level of introspection. And to me, it was: who am I? Like it's going to be different for everyone, but who do I, as Morgan, who am I trying to impress? Whose love and attention and admiration do I want in life? And when I ask that question, it's actually a very simple answer. It's like my wife, my two kids, my parents, and maybe three of my friends. There's a great Warren Buffett quote where he says, 'Success in life is when the people who you want to love you do love you.' And important there is like the people who you want to love you. I don't care or want the love and attention of strangers. And by the way, they're not even paying attention anyway. So why would I even admire that? I desperately want the attention of those six or seven people that I just named. And the other common denominator of those six or seven people is they could not care less about my material possessions at all. My net worth is higher now than it was five years ago. Do my kids love me more? No. Does my wife love me more? No. What they care about is that I'm a good husband, a good father. My friends care that I'm a good, empathetic friend, that kind of thing. And so that was part of my relationship with money and getting healthier with it, was everybody can spend money in a way that's going to give them a better life. But when you really identify the things that are actually going to make you happy—your relationship, your health, your conscience—can you use money to leverage those things rather than what I think is far more common and almost the knee-jerk reaction for everyone, which was get the attention and admiration of strangers with my house, my car, my clothes, my jewelry, whatever it might be, posting on Instagram where you're trying to get the attention of strangers who aren't even paying attention. They're busy thinking about themselves. That was core to me. It was like asking the simple question: there's two ways to use money. One is as a tool to live a better life. The other is as a yardstick of status to measure yourself against others by. And with every dollar that I spend, just asking like which one of those is it? Is it going to help this core desire that's going to actually give me a better life for my friends and family and my health and how much I sleep at night and that kind of thing? Or is it a signaling mechanism to people who are not paying attention? I think at the highest level, that was what helped me the most with my relationship.
Well, but was there ever a time where your psychology of money was unhealthy? Where you didn't feel this way?
I don't know if I would call it unhealthy, but I definitely went through a lot of phases. I don't know if I'd call it unhealthy because it didn't seem to bother me that much. When I look back, my desire for material possessions really peaked and it was very high in my late teens, early 20s. Let's call it 18 to 25. And that was when I was—I just want a Ferrari. I just want a Lamborghini. I just need the mansion. I just need the Rolex. And I didn't know this at the time, but looking back, it's very clear why I wanted that, which was I had nothing else to offer the world. I had no career. I had no intelligence. I had no humor. I didn't know how to be a good boyfriend, husband. I didn't have anything to offer anybody. And so I think naturally in that situation, you revert to: maybe people won't admire me for any of those attributes. Maybe they'll admire me for my car. And I think that was why I wanted it. I had nothing else to offer. And I think as I've aged and gotten a little bit more mature, now I seek my admiration and attention from those people by being a good husband, a good dad. And when you do that, my desire for the Ferrari fell. Now, if you like fancy cars, and I actually do, that's not a criticism, but for my personal life, I was like, my desire for status materialism is the inverse of what else I have to offer in the world. And so think of your favorite comedian, the person you just love. You can't stop laughing when you watch their special. If you learn that person was broke, or if that person, who they probably are, is wearing a dirty T-shirt when they present, you don't care. You value them for their humor. When your favorite athlete goes bankrupt, it's a gossip story, but you value them for being an athlete, not because of the car that they drove. So if you gain your respect and admiration through other more durable things, your desire for materialism tends to decline. I think that's very often true.
You know, but one durable thing is like you describe the athlete, you describe the great comedian, there's also the great entrepreneur who has skill at making money. And so they're almost like the athletes of entrepreneurship, the ones who have been successful at it. And maybe I think a lot of entrepreneurs I know don't really care that much about material goods, but do care about creating something of lasting value. And the metric by which they judge that success is if they were rewarded with money.
Yeah. It's a much clearer scorecard of what they're doing there, where it's very imperfect, but stock price is a pretty loose proxy for the success of that business, in the same way that laughs are a good proxy for the success as a comedian. And so it is more tangible there, where it's like I could probably think of exceptions of people who built amazing products but the stock prices didn't reflect it. They didn't make a lot of money from it. There's probably some exceptions there, but it tends to be much more straightforward that yes, it's hard to be admired as an entrepreneur for those skills if you're not making any money doing it.
Yeah. I think part of my own unhealthy relationship in terms of the psychology of money is not that—I don't think there's ever been a point in my life where I really wanted material goods, but I was so desperate for freedom and independence. I saw my parents go bankrupt and were poor, and they just always did things they hated. They never had independence or freedom. They were miserable. And I was so scared of that that I had this incredible fear, even after—the more money I had, the more I was afraid I was going to lose my independence and freedom. And that feeling, of course, makes you lose your independence and freedom because you end up taking on too much risk and you lose it all. And that was my unhealthy relationship with money. It wasn't a material goods thing. It wasn't even trying to get admiration thing. It was just trying to stay ahead of what I thought was this world trying to take this independence from me. And of course, it made me again take more risks and often lose the money until I realized this trap I was in.
I think what you described is not uncommon for people who made some money. There was just—this is just in the last year or so. Steve Ballmer, who is one of the richest men in the world, is worth $150 billion now, former CEO of Microsoft. He gave an interview with the podcast Acquired. And he doesn't say this directly. He does not say this. So I'm kind of putting words in his mouth, but he kind of hints at the fact that he, worth $150 billion, worries about losing his money. He kind of like skirts around that topic a little bit. And I think it's not uncommon that if you look at multi-billionaires, decabillionaires, centibillionaires, they worry about losing it. Sometimes it's rational because a lot of them have all of their net worth in one stock. So like the odds that they can lose it all is actually like not that small. But it's interesting that there seems to be no satiation where at X net worth I'll stop worrying about losing it. And it's true that when you have nothing, you don't worry about losing. You have nothing to lose. So that thought's never in your head. And what you tell yourself is, 'If only my net worth was a million dollars, $10 million, whatever, then I wouldn't have to worry anymore.' But once you have $10 million, you're like, 'Well, what about inflation? What about taxes? What if I make a stupid investment? What about leverage?' You just exchange one worry for the next. And I think a lot of that is just whatever hole you are trying to fill with money is not being filled. And I think that's true in that situation because there are people who do a very good job at saying, 'Once my net worth is a million dollars, that's all I'm going to need, and I'm totally content after that.' Daniel Kahneman, the late psychologist, told this story that he went to his financial adviser, he was in his 70s at the time, and he said, 'I have no desire to earn any more money. I have no desire to see my net worth higher than it is right now. I just want to live comfortably on what I have.' And the financial adviser told him, 'I can't work with you.' And because to the financial adviser, it was like so antithetical that somebody would not want more money. And Kahneman was like, 'I don't think it's that rare actually that I'm perfectly content. I don't have this desire to just keep accumulating more.' And so some people do a very good job doing it. But the people who don't are the ones who tell themselves, 'If only I had a million dollars, my problems would go away.' And then if they have a million dollars or whatever their goal is, they might even feel worse because they were frantically shoving money into the hole in their soul. And then once that hole was filled, they realized they had the same feeling. And I think in that situation, it's something else. The hole needs to be filled with something else. There's something else going on in your life. And money is obviously not the issue.
Right. And you provide so many stories and so many great pieces of advice in The Art of Spending Money and the prior book, The Psychology of Money. And the question I have is bridging that gap—like recognizing you have that hole in yourself and then somehow, without ever having experienced true health before in terms of money, how do you cross that bridge so you are healthy? Is it a matter of reading and contemplating, you know, the many stories and pieces of advice you give, or is there something else that someone could do or exercise to get that health?
One statement here that I think is very unfortunate. I wish I didn't have to make this statement, but everything that I've learned about money leads me to believe this is true. Most of your personality—and my personal, everyone's personality—is forged at conception. It's not learned in the real world. There is a part of it that is learned experience that you can kind of change your mind on, but some people are wired very differently than others. Of course, that's not a bold statement. And so I think a lot of people who have a lifelong issue with money or a lifelong non-issue with money, that is not a learned experience that you can really teach. That's just how they're wired. Charlie Munger stated this very starkly. He said, 'When you are teaching money matters to young people, they either understand it instantly or never. Those are the two time periods in which they get it.' I think there's a lot of truth to that. But I do think around the edges you can recognize the social games that get played with money, the desire for attention from strangers, the constantly ratcheting of expectations, the moving of the goalpost. You can recognize the games that are being played and become a little bit more cognizant of the forces that are around you. I have to do this with myself. Someone who I think I can say has done a pretty good job at keeping my expectations in check and saving and using money for independence. Not perfect, but I think I've done a decent job of that. Almost daily, I have to remind myself because I'll get stuck in a trap of like, 'If only we had a bigger house. Oh, look at that car. If only I had that. Oh, look at his jacket. What if I had that jacket?' And I have to remind myself, yes, some of those things are worth purchasing. And I do purchase, but I'm not going to get the attention that I assume. It is so common to assume that if I had that jacket, people would pay attention to me and say, 'Oh, look at Morgan. He's looking good.' It's not how it works. It's almost never how it works. And by the way, that guy whose jacket I just saw, I don't care about him. I just care about his jacket. But I want his jacket because I then think people will care about me. It's like, don't you—like you have to constantly remind yourself of how stupid that game can be. And when you do, I think for me, it has pushed me closer towards I want to use my money to help my immediate family and give myself independence and have some nice things that I have my quirky desires for, but I have to remind myself daily of the fact that I'm not going to get the attention that I intuitively assume I will.
Yeah. And you mentioned something in the book, something like, you know, seeking the jealousy of others is like—or doing things that you think will make people jealous of you is like outsourcing your critical thinking to other people. And I thought that was a valuable quote, like you can't ever make decisions by outsourcing decision-making skills to other people who are not you.
So much of that is because you can't see a full, holistic picture of their life. So if you are looking at somebody else, you can see their house, you can see their clothes, you can see their car, you cannot see their mental health by and large. You can't see their relationships, you can't see their physical health, you can't see how well they're sleeping at night, you can't see their conscience. All the things that actually create a good life, you are blind to. And so if you're looking at someone's material possessions and saying, 'They have a great life. I want that life. If only I had that, then I would be happy,' you're seeing maybe 2% of what actually matters in their life.
And you see that all the time, right? In the book, of the top 10 richest men in the world, there are a cumulative 15 divorces among the top 10. And so a group—and obviously it's a tiny sample size, you can't really draw any conclusions from that—but here are a group of men who are among the most admired men in the entire universe, and actually if you dig not that deep into their life, you dig like one layer down into their life, there's a lot of things where it's like, no, that's actually a pretty shitty life for a lot of them. They've been through some very hard times. And I think so you have to take the whole package, you have to get a holistic view of someone's life before you can like reasonably be jealous or envious or even have a sense of admiration of who they are.
And you know, but then you know, and I do like this idea, this exercise of really thinking about what makes you happy instead, and not putting money in there because money is a tool for what makes you happy. And maybe you could say, 'I love going to sleep at night not knowing I'm not in debt.' So in that sense, money can make you happy. But thinking about the other things, like living a simple life or doing a certain activity that you don't normally do. There's other things that you know, listing these things that make you happy and then trying to decide, does having more money get me closer to these activities? I think that is a useful exercise for distinguishing between money and what actually makes you happy. So what should you spend your money on? Should it be freedom? Should it be some of these activities or experiences? Should it be accumulating more money? I think that helps sort of decide things a little better.
Yeah. I think for me personally, having a higher net worth than I did in previous years, a lot of what it's done for me is just a reduction of anxiety. And so, for example, 10 years ago, if my water heater blew out, I would have been devastated. That would have been—it would have crushed me for a month. But now, if it were to happen today, it's kind of like, 'Oh, well, that's a shame. Let's go call the plumber and take whatever quote he gives us.' So that's just a reduction of anxiety. It's not happiness. It's not that, you know, because the hot water heater broke I'm happy. But it's a reduction of anxiety, and that's super important. That's really what it's been for me. The other thing to that point is happiness is always, for everybody, a five-minute emotion. You are like—almost nobody is ever happy for more than five minutes. In a similar way that if you hear the funniest joke in the world, you don't laugh for seven years. You laugh for 30 seconds. Humor is a 30-second emotion. And happiness is very similar. It's always fleeting. So I think what people actually want when they daydream about having more money and what that life would be, what you are actually daydreaming about is contentment. You're imagining yourself in that bigger house with that fancy car, whatever it might be, and being perfectly content with those things. But what is more likely to occur for more people is that if they get in the bigger house, they are happy for about five minutes and then they look across the street to their neighbors whose house is bigger and they start being envious and dreaming of that, they're not content. And so I think the emotion that you want to chase with money is not happiness, because that's something you're never going to achieve. It's contentment. It's getting to a point where you say, 'I'm good. I have everything I want. I have the independence I want. I can spend the time with the people who I want.' That's what you're going for. It's not necessarily happiness, though.
In terms of like the—you mentioned a lot about savings, and I'm not the same type of saver you are, as I can gather from your books. For instance, when people are in their 20s, I think it's always important to have some amount saved just in case of worst-case scenarios, like a parent gets sick, you have to take care of them, you lose a job, whatever. But at some point, because the earning power of someone in their 20s is going to go up so much higher than inflation—not in all cases, but in many cases—saving an extra $100 a month when you're 23 years old is sort of inconsequential. If you already have like six months of runway set aside, I don't think a young person really needs more than that because by the way, that six months of runway you might make in two weeks when you're 35 or 45. So I don't know, and I understand the compounding miracle, like I get it. And also by the way, in The Art of Spending Money, I appreciate your comments about how time compounds also, which is a very important discussion. But I think saving—I don't know, maybe you agree, maybe you disagree—I think savings in your very early 20s when you're first starting your career is not as important as later on.
I could come down on either side of this. I think I could argue both sides of this with equal confidence. So I don't know really where I come down on this, but I agree. I was thinking about this the other day that if when I was 19, if I saved $100, that was a heroic feat. Like, $100 when you're 19 is a lot of money. And I invested that money. So let's say today, I don't know what the math is. Let's say today that's worth $500, which doesn't mean a lot to me. And so could I have had an amazing night out when I was 19 with my friends for that $100, or invested it into an amount of money that means nothing to me today? That's kind of a weird way to put it, but here's where I could take the other side. It is very difficult to live paycheck to paycheck and go into debt and have a YOLO mentality in your 20s and then flip a switch in your 30s and say, 'Now I'm going to become a big saver.' Very difficult to actually make that transition. And I think it's difficult to have good saving habits in your 30s and 40s unless you start them in your 20s. I think that's probably true for most people. So I see both sides of that equation. It's funny you bring this up because I was literally thinking about it last night. The $100 when I was 19 is $500, which means nothing to me today. I was thinking about that last night. But I also think if I didn't do that at 19, I would not have the saving habits today in my 40s that I think have made a big difference in my life.
I think that's an excellent point, and that could potentially change my mind about this. Like you—and you sort of make that point in The Art of Spending Money when you say don't view it as savings, view it as spending on future independence or spending on independence now. So if you have that satisfied feeling that that $100 of savings that month is going to create this enormous independence for you in the future, then that could feel very pleasurable and give you this feeling of contentment that we're—you know, what could be better anyway. So you know, the book started to make it understandable to me, and what you just said also makes it understandable to me. I could see both sides of it now as well. I just have known that in the past when young people ask me for advice, I always say after that—after you have that—and I say this to my kids, after you have that first six months, you know, they're in their 20s. So I say to them, if you have that first six months, you know, if you have six months of savings so that you could do nothing for six months, that's good enough. And then just focus on improving your skills, being good at what you do. And I'm not saying go out and party all the time. I don't necessarily encourage them to strain their life by saving an extra dollar or two where they're living in New York City, which is already expensive and a hard place to live and so on.
Yeah. No, I definitely do not disagree with that. I think that's wise advice that you give to people. The other part of this I've thought about is for a lot of people when they're adults, if you ask them, 'What are some of your greatest memories in life?' Not everybody, but a lot of people will tell you high school and college. And again, not everyone, but a lot of people be like, 'Oh, it's so fun. We went to parties. We hung out. We went to the lake. We stayed up till 3:00 a.m.' And one common denominator of those years is most people have no money. And so the idea that you need to spend a lot of money to have great experiences, which is kind of tied into that point you just said, I think is almost usually the opposite. That in your 40s when you probably are making more money than you ever have, is when people's lives tend to be more common that their lives are very monotonous and they're not doing that much. And in your late teens, that tends to be when you have no money and every day is an awesome adventure with you and your friends. So, it's not really black and white that like in your 20s you should go spend money and have these experiences. You're probably going to have awesome experiences anyway because you're probably not married. You probably don't have kids. You can probably jump around from city to city and that's awesome. When I look back at my 20s, which were not perfect, I would do things differently. So, I'm not saying that this is a template. I was a hypersaver. That's probably the right word. And I have endless memories of places I went. I lived in seven different cities and worked at tons of different companies and met tons of awesome people. And so I don't necessarily view it as sacrificing experiences. It was the experiences came because of the phase of life I was in, not because of the money I was or was not spending.
Yeah. And also, and I, you know, I think of this in my mid to late 20s. I had no money but super happy, great experiences. But it's also because those great experiences were hard to have. I had to earn those experiences in ways other than spending for them because I had no money. Yeah.
So, so you know, you prize the things that you had to work hard for. Whereas, if it's easy to buy something, it's not that interesting.
