Wednesday, March 18, 2009


Money and I have a decent but fleeting relationship; we have fun together but often part ways very quickly. I am incredibly responsible in many aspects of my life with a thriving career, well-cared-for dogs, strong personal relationships, (somewhat) good eating habits, and a healthy exercise schedule. However, when it comes to managing money I am a complete moron. I am sure if I really put my mind to it I would be half decent in the realm of saving and investing but the whole process is rather boring and time consuming. For years I felt guilty about my poor saving habits, made excuses about how little I contributed to my retirement plans, and had various financial advisors frown at my monetary choices. But, after looking at my recent statements I no longer feel guilty; I feel vindicated!

The lack of enthusiasm for all things financial actually makes my plummeting profile easier to handle. Math is not my forte but upon a quick examination I have lost just about 20 cents of every dollar I’ve put away since 2000. Essentially if I would have just shoved that money under a mattress rather than be responsible and put it into my 401K, mutual funds, IRA, and stocks I would have 20% more than I have right now. Finally my monetary irresponsibility worked in my favor! Had I listened to the “experts” and been more “responsible” with money through the years my investment losses would be even more devastating. One could argue that all the money I spent rather than saved is also a financial loss but I disagree. I opted to invest in other things through the years. Although the ROI on these “investments” cannot be calculated by an accountant the ROL, Return on Life, cannot be disputed.

Many of my friends and co-workers followed a savings strategy that they believed would allow them to retire early so they could enjoy life. Taking the “responsible” route meant working like dogs, squirreling away every dime they earned so they could retire while they were “still young enough to enjoy life” and do things. Even before the economic downturn this logic didn’t work for me; we don’t get any younger and life should be enjoyed now. Dreams of retiring by 45 required sacrificing the here and now for the possibility of enjoying life later. People forget that later on might not come, that every day of life should include some level of enjoyment, and that we are young once and should take advantage of that youth. People are now realizing just how possible it is to work hard and have nothing to show for it when investments sour. I am glad I have more to show for years of labor than my now worthless 401K; a healthy ROL.

Perhaps ROI is easier to quantify than ROL because the calculation for ROL is different from person to person. Most people, although adept in understanding the return they get on their monetary investments, don’t understand or appreciate that the money they spend can have a good, or bad, ROL. People often spend money on stupid things that do not yield good ROL while bypassing those things that do. I am just as guilty of making worthless purchases that yield little to no benefit while bypassing those things that bring me measurable joy.

Through the years I realized I have a great affinity for shiny things, fine wine, good meals (and the kitchen items that make those meals happen), leather purses, camera equipment, fuzzy puppies, books, and quality bath and beauty products. I love to spoil dogs, family, and friends to make them smile. Cheap, processed food will never again pass my lips. Group fitness is worth every penny beyond cheap gym memberships. The world is a vast and beautiful and there is nothing I enjoy more then traveling to exotic destinations and staying in the most posh hotels. My house might be worth less then what it was purchased for nearly 4 years ago but it is still the home to many of the most amazing and happy memories I share with friends and family.

Many people might find my “investments” wasteful, not sharing the same ROL I get from seeing the world, entertaining friends, wearing nice jewelry, buying organic for my family and animals, eating, drinking, looking nice, and making memories. Conversely I have trouble understanding the ROL others get from spending their money on things like cars, electronic gadgets, nick-knacks, and raising children. ROL requires figuring out what makes you happy and focusing your disposable income on those things. If you can afford to buy a new car every year, understand it yields negative ROI but makes you very happy then it is a wise investment in your ROL.

Do I wish my retirement savings were at their pre-economic slump levels? Absolutely! But I am incredibly appreciative that I have more to show for the past 12 years of employment besides a depleted retirement account.


Jen said...

Ha! I hear ya Michelle! I go back to the School House Rock Song..."Buy low, sell high, get your piece of the pie, that's the Wall Street way..." and I am still investing, but much more cautiously. On another note, great pic of you and I hope you are enjoying your European vacation.

Nursedude said...

You know what? You have no guarantees about tomorrow whatsoever. I know that trip to France I took with my family back in 2007 cost a lot, and we did put a lot on the Plastique, but I would do it again in a heartbeat.

Our 401k's got decimated as well. So much for being "responsible"