Wednesday, April 27, 2011

Does an Income Dollar Amount Equal Effort?

On April 15, I read Penelope Trunk's article about how much money you need to be really happy. While this concept isn't exactly news, it made me think about how much money would really be worth the effort. I made this graph as a way to visualize where I've been on the scale.

When I lived in Alexandria, I diluted my Suave shampoo so I could have a sports car. The car itself had a high payment per month (over $500/month). The insurance, even though I'm female with no accidents, was $2200 a year! The taxes, on top of all of that, was over $350/six months just to park my car on the street to get a dent. It was an expensive choice. If I had to do it all over again, maybe I would have chosen differently. I was apathetic at the time whether I wanted better clothes or a car with a turbo.*

There was a night where I made my own pizza out of the ingredients in the fridge. When I took it out, it burned my hand and I dropped it. Since I was so hungry, I was very upset that I dropped the pizza, even if it was hurting my hand - that was all of the healthy food I had until the next paycheck, which was the next day.

Hopefully I will never go back to that lifestyle, as I had see-through toilet paper, and could not afford to go to the cool places surrounding the Alexandria area. I was definitely at a point where I took a cooler to where my friends lived because groceries were cheaper in their area. What a horrible experience! The irony was that I was about 15-20 lbs heavier at the time, because I was so enamored with free food (e.g. bagels, ice cream, etc.). On a side note, salads are rarely free :)

 If we were just looking at money as dollars, and not as some metric for how much effort is required for that amount, then I could use more. There are nice $1M condos to buy, we could retire sooner, we could get going on our hobbies without worrying about income. That would be totally cool with me. Unfortunately, I get the sense that more money = crazy lifestyle with no time to yourself.

Right now I don't have a lot of time, so squeezing out that last bit for a few extra thousand dollars is ludicrous. The money isn't worth it (especially after taxes).

What makes me kind of happy is that there are other articles saying that being a good saver is better than making extra dough. According to me (of course), I'm an excellent saver. I could probably stretch $30K way farther than the average bear because I can prioritize and discard what's unimportant. 

Undiluted ketchup is important.

After my sports car, I bought something more reasonable. It was everything I could want in a car, especially if I were to spend more than 45 minutes a day in it (my total commute can range from 1.5 hours to 4 hours a day). I eat better, and spend money to make salads and healthy food at home. Affordability is no longer an issue, but it's still expensive to eat right and make good money decisions. 

I hope if I get to the point of making $700K per year, that my decisions will be whether I get a driver for my car or not... whether I go to the French Riviera or not... whether I decide on the dryer that automatically folds clothes or does taxes. 

*These things still seem almost equal to me. You spend a lot of time in your car, but you get a lot of respect from your clothes (as a woman). Which is more important? Is there something else that's more important?