On the Road To Financial Independence, Perspective is Everything
I’m about to get a bit philosophical on you. Perspective is everything. It’s a concept I’ve used in all aspects of my life since I came across it several years ago. I’ve applied it to everything from dealing with stress at work to personal crises, as well as to motivate me along my journey to Financial Independence (FI). Adjusting your perception on the value of material things vs. freedom is an integral process for achieving FI. In addition, It is important to understand how FI provides increased control and happiness in your life in order to stay motivated and focused on your journey to FI.
Perspective is Everything
Before we delve any deeper, I highly recommend you watch this very entertaining Ted Talk video regarding perspective by Rory Sutherland.
If you take nothing else away from Mr. Sutherland’s talk, remember these two concepts:
- “Choose your frame of reference and the perceived value and, therefore, the actual value are transformed”
- “Perceived control over your situation equals increased happiness”
Now, let’s apply these concepts to our goal of FI.
Choose your frame of reference and the perceived value and, therefore, the actual value are transformed
Let’s take a look at the first concept, Choose your frame of reference and the perceived value and, therefore, the actual value are transformed. This implies that we can simply choose to change how we perceive what a fulfilling life actually consists of, and it indeed becomes reality. This re-framing process is integral to the goal of reaching financial independence by enabling us to question the value of obtaining material things vs. the freedom provided by reaching FI. To quote Henry David Thoreau, “The price of anything is the amount of life you exchange for it.” “The price of anything is the amount of life you exchange for it.”
I’ll use the downsizing of my own home as an example. Many of my friends were amazed that I was willing to give up my large home and property when, financially, I didn’t really need to. However, my perspective is totally different. I have chosen to perceive the downsizing of my home as an opportunity to provide increased value to my life by freeing me from maintenance, property taxes, and a large mortgage. I have reduced my stress, gained valuable time, and freed up a substantial sum of money to accelerate my goal of FI. The pursuit of a larger home is no longer desirable or important as it represents an obstacle to my goals.
Perceived control over your situation equals increased happiness
The second concept, perceived control over your situation equals increased happiness, applies directly to the purpose for pursuing FI. Financial independence provides an increased sense of control over one’s life by providing options. It provides the freedom to take risks and the choice to remove oneself from situations that they do not feel are in their best interest. All without the fear of financial hardship. Freedom, choice and, therefore, control = happiness.
An obvious example is the ability to quit or retire from a job or career that is either toxic to your well being or no longer fulfilling. FI provides you with the perceived control over your own well being because you no longer require the income of that career. You feel free to try a different career, risk starting your own business, take some time off, or spend the rest of your days relaxing under palm trees.
For another take on the subject, check out Jim Collins excellent blog post titled, Why You Need F-you Money. I highly recommend you give it a read along with the rest of his blog. I enjoyed his spin on the topic and it was quite transformative on my outlook regarding employment, as well as the financial security provided by FI: Why You Need F-you Money
So there you have it. Remember, perspective is a choice. You have the ability to take control of your circumstances by choosing the frame in which you view them. Use that ability to motivate and guide you toward your goal of FI and, therefore, increased happiness. Freedom, choice and, therefore, control = happiness.