Monday, August 7, 2017

August 4 – Money

I’ve been thinking a lot about money. You may have noticed in these journals that I frequently note how much things cost. I do this so that I can look back later and be reminded of what the day to day costs were like in the places we visited, but also because I am constantly amazed at how little some things cost here. For example, our typical bill for a full dinner or lunch with a beer or two and drinks for everybody is around twenty dollars, but has been as low as ten. If we were on a tight budget and really scrimping we could probably get by on five to eight dollars per person per day for food. The bus tickets are ridiculously cheap. The ten hour overnight bus we are taking tonight costs thirteen dollars per ticket. Hotels have been reasonable, usually averaging around $55/night which includes breakfast. But you can get dorm rooms in backpacker joints for as little as five bucks per night. The point is, you can travel or live here for a very long time on a small amount of money.

So what is money? Money today is typically a sequence of numbers you see in your online banking, or on the receipt from the ATM, or on your paystub. This makes it easy to forget what real money feels like. When I was a kid I used to stuff money into the pockets of my jacket, use it up, and then replenish it when possible (not very often). Every autumn my mom would retrieve the winter jackets from the downstairs closet (which had been packed away all summer – at least a month).  I would put my jacket on, unzip the pockets, and see what was there. Sometimes I had forgotten a bill – usually a fiver or sometimes a ten if I was real lucky – and finding that money felt like winning the lottery! I would pull that ten dollar bill out and thank the past me for the generous gift. Ten dollars was a LOT of money. Ten dollars is STILL a lot of money, and if you don’t believe that then travel through Cambodia or Vietnam for a day. Many people in this region live on a hundred bucks per month.

Sometime around the age of 40, my relationship with money changed. I don’t know what triggered it, but one day money stopped mattering to me. Up until that point I had always been quite conscious of money, and I focused on earning and saving and investing as much as possible. But what changed is this: I no longer felt like I was ever going to run out of money and be completely broke. This feeling had been driven into me from a young age. When my brothers and I were young, my parents worked hard to earn as much as possible just to keep us fed, clothed and in a house. We were taught from an early age to go out there and earn money to pay for the things you want, by yourself, instead of relying on others (parents, government, friends) to pay for things for you. We also learned about value, and how to make the most of the money you had, and if you didn’t have any money, you had two choices: go without, or go earn some more. It was a great lesson, and has served me well my entire life.

After high school I went to university and paid for it myself. My parents helped by letting me live at home, paying for food, and floating me the odd twenty every once in a while (usually on Thursdays at Bud’s On Broadway for tall Rye and Cokes) which helped me through those four years. But I was flat broke most of the time as the money I made during the summer was needed for tuition and books, and I usually had a grand or so left over which had to last the entire school year.

After I finished university, and started working and earning decent money, the reality of having more money that I needed to live on was very new, very exciting, and opened up a lot of possibilities. Those pounds or rupees or Bahamian dollars or American dollars that were deposited into my bank account on a regular basis, at times, made me feel like an imposter, living somebody else’s life. And I spent a lot. And I saw a lot of the world. And I got to do things that few people will ever get to do. And I had a lot of fun. A lot of fun. During this time I made friends all over the world and found my perfect partner. Without money, I wouldn’t have been able to do that.

When Ana and I returned to Canada my uncle Gerry taught me all about investing. Even though I had a Finance degree, I really knew nothing about it, and my ill-advised experiments with investing in offshore funds did not turn out particularly well. But I did have money and uncle Gerry showed me what to do with it and mentored me for many years, and continues to do so. Over the years, Ana and I have done many money making side projects to increase our income and we have learned to be extremely thrifty on the boring, everyday things we don’t care about (bills, vehicles, dining out, unnecessary kids activities, groceries) but splurge out on the things that give us great happiness (sailing, vacations). I track our cash flows to the dime and every year we can usually save over 30% of what we earn, which we put back into investments. So overall, we have found a system that works for us and are in pretty good financial shape – but it took a lot of years and learning to get where we are at today.

So what really changed with my relationship with money? I am no longer excited by finding a ten dollar bill in the pocket of my winter jacket. To me, it is just another ten dollars that will go to paying for groceries, gas, mortgage, or maybe it will go into an investment account. In the words of the great B.B. King, the thrill is gone. It sounds sad, but is really not, because these days I know that whatever happens to us, in our jobs or our lives, there’s a very high probability that we will be fine financially. Yes, that ten dollar bill is a lot of money, but I know what to do with it to maximize the utility I will receive from that ten dollar bill. It is not a windfall like it was in the past; it is now part of a larger plan.

Which brings me to the budget for this trip. We do not have one. Yes, we have an idea of what the trip is going to cost us, and we have pulled back on our spending this previous year to ensure we have the cash available, but we are not adhering to a strict budget, nor are we tracking our expenditures down to the last dime like I do at home throughout the year. Why? Because I know we have the money available, and what we are investing in is time with our children, self-knowledge, ideas we can bring home to Canada and, in a small part, helping some less fortunate people out by spending money in the countries we travel through.

Oh, we spent the entire day today hanging out at the beach.

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