One of, if not the biggest obstacles to financial independence is Stuff. All the Stuff that we buy, think we deserve, think we cannot live without, then eventually throw away. Most of the Stuff is a small like that oh so cool new toaster that sends you a SMS message when your toast is ready. Some of the Stuff is large like that McMansion that you must have because it has a fifth bedroom and your parents and aunt might visit someday. Stuff is great, we love our Stuff and everyone needs Stuff. However, every single thing you buy moves your financial independence day further into the future, perhaps by a few minutes, perhaps by years or even decades.
I was fortunate to discover the power of Stuff at a relatively young age. When I moved out of my parent’s house into my own apartment in the for the very first time, I was very excited. I finally had a place of my very own, furnished and decorated exactly as I want it, filled with my own stuff. I found a nice apartment and my very first purchase was a TV. I carefully measured my apartment, the doorway, plus the wall and bought the biggest TV that would fit into my apartment. This was back in the days of projection TV’s so it was not small. I got a huge 50” floor standing projection TV that probably weighed over 200 lbs.
I was so happy when the delivery people brought the TV, carefully squeezing it into my apartment with an inch to spare. I loved that TV. I bought a 5.1 surround sound subwoofer system, separate Polk Amps and 200 CD carousel player. I got a Lazy Boy sofa and recliner that was sooo comfy I called it my potato maker because it instantly turned you into a couch potato. I had a good job, was finally independent and in my own place with no one to tell me what to do or how much TV I could watch. I was the envy of all my friends who would come over to watch TV with me on my (for the time) gigantic screen.
Life was good until my lease was up and I had to move to a different apartment. As I looked for my new apartment I found myself measuring the spaces and entrances to see if I my beloved TV would fit. This apartment would not work because the living room was too small for the TV and my Lazy Boy would have been two feet from the TV. That apartment would not work because it had stairs with a bend that my TV would not be able to navigate. Eliminated this other apartment off because it was on the 20th floor and the elevator was too small for my TV or my big Lazy Boy sofa.
After rejecting six or seven apartments I came to the realization that I was not looking for an apartment for me, I was looking for an apartment for my stuff, specifically my beloved TV. I was not looking for a place I liked for the location, view or price, I had to get a place that fit my Stuff. I eventually found an apartment that was perfect for all my Stuff. I had learned an important lesson though, my Stuff owned me as much as I owned my Stuff.
I still loved my Stuff. I still wanted my Stuff. I still needed my Stuff. We all need Stuff. We cannot all live in the forest. Even the hunter/gatherer peoples living practically naked in the jungle have stuff, even if it is just a bow and arrows or a woven basket. The key to independence is understanding the true cost of Stuff and NEVER letting your Stuff own you.
The true cost of Stuff is not the dollar amount of the item. That Starbucks coffee you bought did not cost you $5.70. It cost you an hour of freedom. Let us say you need $50,000 a year to live on. That comes out to $136.98 a day or $5.70 an hour. Therefore, that delicious Starbucks coffee put you an hour further away from financial freedom. Is it worth it? You bet your life! Delicious caffeine goodness that makes life worth living! If I had to drink the watery swill they call coffee at the office I would not make it through the day without snapping and getting fired.
However, I am conscious that every penny I spend is actually time that I cannot be free. I make a judgement on each purchase as to whether it is worth the cost, not to my wallet, but to my freedom. The coffee is a must but the pastry is nothing special so it is not worth another hour of my freedom. I make the same judgement for everything I buy. Is that $1,300 cell phone worth 10 days freedom? I definitely need a cell phone but perhaps if I the $600 phone would be almost as good and I can retire a day earlier? Perhaps I can get the best $1,300 phone but only upgrade every five or six years when they stop providing security updates instead of buying a new phone every two to three years? I think of the cost things not in terms of dollars and cents but in hours and minutes that I could be travelling to Asia, Europe or to some tropical beach. Would I be happier buying this item now or would I be happier spending that amount of time travelling later? If the item was worth more than the travel time, I would buy it.
Once I reframed the cost of Stuff I found that I was not as tempted to buy Stuff. The idea of money is very abstract. How much happiness is $138? I don’t know, it is just a pile of paper. How much happiness is a day of freedom lounging at a beach or perhaps just sleeping in? We can all relate to that. Those fancy new shoes are definitely worth $138 but are they worth a day in Thailand? Perhaps not.
Reframing my idea of money helped me save. I always contributed at least 10% of my pay to my company 401k. I put half of every raise towards my 401k. If I was contributing 10% to my 401k and I got a 4% raise, I increased my 401k contribution to 12%. I thought of it not as saving money but saving free time. They say time is money, but just as importantly, we must understand that money is time. People say they don’t have time to travel but this is not true. They do not have time to travel because they need to work for money. If they had money, they would have plenty of time to do whatever they want. I understood that it was not money in my 401k account, it was time. Time that I where I would not have to go to work, time that I could do whatever I wanted, go wherever I wanted.
Just as importantly, I learned to not let my Stuff own me. Several years later, the economy hit a recession and many people lost their jobs. My company went through several waves of lay offs and my former coworkers were having a hard time finding new jobs in the bad economy. Eventually I got laid off too.
My co-workers were sitting in their expensive apartments, amidst all their Stuff while desperately looking for new jobs while watching their savings quickly dwindle. I lived in San Francisco at the time so rents were not cheap. People who had been laid off months before me were still unemployed. I did not want to be like them so I decided to go travelling. I looked at my expenses in San Francisco, researched how much it would cost to go backpacking around Asia and realized the two costs were about the same.
My lease was conveniently up so I sold all my Stuff including my beloved TV, keeping just a few items at my parent’s house. I got unemployment, had some savings and got some more money from selling my stuff. I booked a one-way ticket to Asia and spent the next nine months on an amazing adventure travelling though Japan, China, Thailand, Cambodia, Malaysia, Australia, New Zealand, Fiji and Indonesia. I was able to do this because I was not attached to my Stuff. My old co-workers could not leave their apartment and their Stuff, I was free to go anywhere I wanted, for as long as I wanted because I did not have to worry about paying rent, coming back to my house or my Stuff. Almost everything I had was in my backpack. I found that it cost me less to travel than to pay rent and live at home.
During my journey, I met a girl in China and just stayed in China for the next five years. I like to say I accidently moved to China for five years and I was able to do so because I was not tied down by Stuff. Over my five years in China, I once again accumulated a lot of Stuff. TV, furniture and other stuff. After all, I still loved watching TV on a comfortable sofa. Eventually though I felt like returning to the United States. Once again, I sold all my stuff and returned to the US, bringing with me only my fiancé, our dog and a couple of suitcases. We got married, I got a new job, bought stuff, bought a house, got laid off again, was unemployed for a year, found another job, bought another house, had a child, bought more stuff and built a normal life in the US.
Fast forward a couple of decades and my wife and I wanted a change. I looked at all our stuff and realized that it was worth quite a bit, particularly our house which had appreciated quite a bit since we purchased it. If we sold all our stuff including our house we would have enough money to retire. This would be unthinkable for most people, after all where would we live? Where would we keep all our Stuff? For me though the idea of getting rid of my house and all my stuff was not scary. I had already done it twice before. We all need stuff, stuff is great, but never, ever let it become Stuff.
We sold all our stuff, including our house and rented the smallest 5×5 storage unit we could find to store a few sentimental items. We bought the smallest motorhome we thought we could be comfortable in and have been travelling full time around the world ever since. When you look back on your life, will you remember it for all your Stuff or will you remember it for all the great experiences you had?