What if we defined financial success by being able to answer questions such as the six below?
By striving to live a life where the responses are at the focus of our decision-making?
Asking questions like these can lead to different approaches with work, family decisions, health, retirement, and so much more.
1. Do I look forward to my day?
If you wake up each day stressing, not counting it as a blessing, then something's not right with your current life course. The money from your (stressful?) job may be excellent, but at what cost? If you are low when you wake up, it doesn't bode well.
Very rarely is 'everything' wrong with a person's life. Imagine dividing your life into six or nine boxes with headers like 'health', 'career', 'family'. 'friends' etc. Rank each subdivision on a scale of 1-10 and pleasantly surprise yourself how many are better than average.
Taking a more quantitative approach like this can depersonalise a situation and shine a spotlight on specific parts of your life. It may provoke some thought-provoking revelations.
90-95% of the thoughts you have today are the same as the ones you had yesterday (and will have tomorrow). Any wonder you're getting a severe case of SISO ('Shit In, Shit Out')?
Very often, people take for granted or have 'normalised' what's not working for them. It sometimes takes a different approach to realise.
Spike Milligan once said "I've been poor and miserable and I've been rich and miserable. Give me rich and miserable every time." But it doesn't matter how much you're making each month if your life lacks meaning.
2. Am I taking care of my health?
I have spent a long time kidding myself on this one. I went to the gym a few times a week and was pretty active. I thought I ate well and 80 per cent of the time I did.
But I was stressed, and my sleep patterns were terrible. The resulting stress led to weight gain, irritation and cyclical periods of colds, touches of flu and chest infections.
Simply put, I had slipped into denial and bad habits, habits which I am still in the process of reversing.
For me, health starts with diet - as per the previous point, SISO is of great importance. I took the time to consult a professional on macros and figured that my health/weight/self-esteem was down to this fundamental.
As before, financial success cannot be simply measured by your net worth if you lack the health to enjoy it. Too stressed or exhausted to play with your kids? That sucks. Fall sick as soon as you lie on the sunlounger on your annual holiday? That sucks.
Being blunt, you may well end up spending all your money and more on trying to recapture your health. If you've not left it too late.
Do I have the financial freedom to enjoy my personal interests?
Have you ever caught yourself saying "One day I'll..." or "When I retire..."? What happens if "One day" never comes or you are too sick or old to enjoy your retirement?
What most people, if they are honest, actually aspire to is not being a millionaire (or better). It's having some of the benefits of the lifestyle, that is to say, the 'doing' not the 'having'.
This might be owning a sports car or going on a luxury holiday for four weeks. It may be sending your children to private school (public school for those reading in the UK) or indulging in an expensive hobby such as flying.
Change your perspective on money from thinking how much you earn per year. Instead, ask yourself what your ideal life would cost per month. You may be surprised - 'doing' can costs less than you think.
Do I have enough of a buffer in the event of an emergency or an opportunity?
What if you, or worse, a partner or child, fall sick. Do you have the funds not to work while you or they are being taken care of?
According to the Money Advice Service, 15% of Brits have no savings at all, and just under one in three Brits have less than £1,500 in savings.
The Money Advice Service recommends having three months of expenses saved. However, I believe this should be more like 12 months, in cash, because a year only seems a long time when you are five and waiting for your next birthday.
I would make this a priority over paying any (unsecured) debt - save your one-year buffer and just pay the minimum on credit cards etc. Why? Because you are paying yourself first and let's face it, if you fall sick, your credit card company are unlikely to give a shit.
Am I invested in becoming my best self?
When was the last time you learned something new, or how about an even lower hanging fruit? When was the last time you bought a book to learn a new skill?
A lot of people think education ends when you graduate, but the best people know that education is a journey, not a destination. A lot of people boast of their 'experience'. But is that the same experience repeated 20 years in a row or one that builds on the previous lessons?
It is highly likely, nay, inevitable that your life will improve if you expand your horizons, knowledge base and network. By continually seeking knowledge, you can't help but trip over new opportunities. Trust me, I know.
Is financial independence a destination or a journey?
I found an old journal of mine - written before my 30th birthday (I am now 30-16). It laid out, in some detail, what my assets, skills and hourly rate were and in no uncertain terms stated I would be retired at 43 with c. £4.8M to my name.
At the point of writing, I'm not retired, and I've not (yet) got the best part of five million in the bank. I have, however, learned some great (tough) lessons and met some wonderfully smart and generous people.
These milestones have convinced me that I will achieve the sort of success I've always pictured for myself and my family. It may not be as I expected, nor from the revenue streams, I envisaged nearly 20 years ago.
It will happen though, and better than I pictured in the past. I also know that I will keep learning and growing, and with that, achieve a greater sense of meaning. More than happiness, a sense of purpose means everything to me.