Responsibility is the Price of Freedom

Do you ever question saving money? What if I got hit by a bus tomorrow and I haven’t traveled, haven’t started that new business, or denied myself simple pleasures?

During the depths of recession I asked Can You Live on 50% of your Income?

For many people, it isn’t a question of CAN you live on 50% of your income. The real question is… Do you WANT to live on 50% of your income? Are you willing to make the hard trade-offs? What might those trade-offs be?

  • Travel
  • The type of food you eat
  • The clothes you wear
  • The car you drive
  • Walking away from a mortgage and renting a room in a crime ridden neighborhood
  • Dropping out of school

Most Americans would be surprised how little you NEED to stay alive. Most Americans use the word NEED to describe the things they think they NEED to live the life they WANT to live. Most things people think they NEED are not NEEDS at all, but DESIRES.

On Get Rich Slowly, a 20 year old just asked Am I Being Foolish Saving So Much?. He saves 50% of his income, lives at home, and attends college. If he quit saving so much, he believes he could move out, start a business, or buy a new car. Why should he sacrifice those possibilities to save money he can’t touch until he’s 65? Good point, isn’t it? J.D. gives him a decent answer, and he gets close, but not quite there. Maybe J.D. didn’t want to get esoteric or political, but this is the answer…

Everything you choose to do has a cost. It’s called opportunity cost. Every minute you spend could have been spent doing something else. The opportunity cost of writing this blog post is nearly infinite. I could have spent this time reading to my kids, golfing, biking, or even robbing a bank. The same principle applies to money. Your money represents your time and your(or someone’s) past labor. When you choose to do something with your money you are indirectly spending “time”. When someone steals your money or property they are murdering a portion of your life.  No one tells you that in school, do they? When you save your money, you are saving a part of your life for use later. If your life is shorter than expected, saving is a bad deal. That’s why you need to decide for yourself what you want to do. No one should decide for you. Don’t  allow them to. It’s your life. You choose. It’s called freedom. But you’ll have to live with the cost of your choices. (Well, maybe not, you can get someone else to pay your costs if the right people get elected, but in any case, someone is going to incur the cost of your decisions.)

Who are we to tell people what they should and shouldn’t do with their time? Who are we to tell a kid he can’t drop out and be a musician, or an artist, or an entrepreneur? We don’t know the cost of staying IN school. We think we know the odds, but I’m not sure we do. Who are we to say you shouldn’t get married at 18 and have kids? How do we know that will lead to unhappiness? Maybe waiting will lead to unhappiness. I’m delighted I’ve been with Christine since we were 19.  It’s one of the best decisions I’ve ever made. There are things about our relationship that would be nearly impossible for a couple to build if they met at 35.

We can only make an educated guess about risks and possibilities based on what has happened in the past to other people. But that doesn’t mean you will get the same results as others. There are oddles of people who took all the safe bets and are miserable.

So what should our 20 year old writer do? Whatever he WANTS, but whatever choice he makes will have costs. Weigh them, decide, and accept responsibility for the decision. Responsibility is the price of freedom.

Edit 5-15-2010: I know this post was all over the place. But this is my point – Imagine if Steve Jobs had decided to stay in school and save his money instead of building a computer in his garage. What would have been the opportunity cost of his decision?

4 thoughts on “Responsibility is the Price of Freedom”

  1. I always find it strange how we form so many hard and fast opinions to donate generously to others about things for which we have no possible idea of the outcome.
    ‘you should have babies by 25’, or ‘your music will take you nowhere,’ and it comes usually from someone whose own life few would want to emulate. I’m with you on this …just think, then do…it’s your choice.

  2. Steve Jobs is an interesting example, but your anecdote is not entirely accurate. It was Job’s buddy Steve Wozniak who built the computer; Jobs was the marketer who built a company out of it.

    Woz, by the way, left the company early on and has lived the life of a Gentleman / Philanthropist / wise guy ever since. It’s interesting to note that Woz returned to college and finished his degree in 1986. Another example of how different choices work for different folks.

  3. The way I see it is that money on our bank account is a secondary thing anyway. The most important thing in my opinion is to find out what really is the way of living that makes one happy. Usually people think they know it, but actually they are living someone else’s dreams or dedicate their lives for “being normal” when such thing actually does not exist.

    Too bad that they don’t teach us in school to follow our dreams. Maybe the whole system would not work if more people realized how big waste of time and life it is to work for someone else in a job that isn’t particularly fulfilling.

    I want to afford certain things in my life, but I am willing to skip huge mortgage, overpriced car, and all the luxuries, if it allows me to be free and do what I enjoy doing the most.

    By the way, I think traveling isn’t that expensive in long-term if you choose the right countries and skip luxuries. It is quite possible to live normally with $20 a day (accommodation included) in many countries outside the Western world, so it’s all about the flights, and they are not too expensive nowadays either.

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