
The real use of money is to buy freedom - paraschopra
http://paraschopra.com/blog/personal/money-buys-freedom.htm
======
miles
Tim O'Reilly on money:

 _It’s easy to get caught up in the heady buzz of making money. You should
regard money as fuel for what you really want to do, not as a goal in and of
itself. Money is like gas in the car — you need to pay attention or you’ll end
up on the side of the road — but a well-lived life is not a tour of gas
stations!_

Source: [http://radar.oreilly.com/2009/01/work-on-stuff-that-
matters-...](http://radar.oreilly.com/2009/01/work-on-stuff-that-matters-
fir.html)

~~~
nexttimer
> The real use of money is to buy freedom

The real problem is: This additional freedom you can buy with money means less
freedom for somebody else.

Inequality (wealth-based) means nothing else than domination. If you are
richer, then you dominate the poorer people. And richer countries dominate
poorer countries.

This is the most basic and fundamental injustice [0] we seem to accept in our
Western culture. Because we are those who dominate.

[0] If you remember that we keep telling ourselves the nice little story how
every life has the exact same value.

~~~
dbecker
_The real problem is: This additional freedom you can buy with money means
less freedom for somebody else._

This assumes that wealth is a zero-sum game, so it can be traded around but
not created.

It's hard to reconcile that view with the fact that standards-of-living have
been growing, more or less worldwide , for the two centuries.

~~~
ashray
Is the standard of living really growing for _everyone_? Or are there more
people now (%wise) in poverty ?

This is an honest question as several people have mentioned the standard of
living argument before on HN. I've read however that the rich-poor divide is
growing and thus am just wondering about this..

~~~
randallsquared
Both can be true at once. The richest are farther ahead than the richest were,
in monetary terms, but the poor have made huge strides in absolute wealth as
well: it's possible to live a 1950s upper middle class lifestyle on almost the
same dollar amount in 2013. Our idea of what a middle-class lifestyle entails,
though, is now far above that.

~~~
gress
A 1950's upper middle class lifestyle involved owning a relatively large
house, and sane working hours with in many cases only one wage earner.

It's simply false that you can live this way today on the same dollar amount.

~~~
bmelton
Well, definitions have changed, completely. The average home size in 1950 was
~1000 square feet, while the average home size in 2004 is ~2400 square feet.

Similarly, the 'sane working hours' you mention, generally speaking, were 48
hours a week or more. In the 'upper' middle class, more hours were spent at
the office as well. Today, the average worker works ~37 hours.

Assuming job accessibility (which I have no idea if there's a guarantee of or
not), and more reasonable home purchasing, I think it's not "simply false"
that one can live the same way as they did in the 50s on the equivalent
working wage, one simply has to make more apt comparisons to see that the goal
posts have shifted.

The average 1950s family only owned one car, while the average family of today
owns more than one (likely, to support the second job). If each of us bought
houses half the size of what we're currently buying, and half the cars, we'd
likely be in greater parity with our 1950s brethren. Also, they had to pay
less than half of what we did for college, and they also likely didn't borrow
in order to afford it, which factors in even further in measuring debt load.

Anyway, I think your comparison is somewhat rose-colored.

~~~
vkou
The average worker works 37 hours these days, because of a big shift to part-
time no-benefits jobs. So, you've got people working 30 hours to make ends
meet, and you've got people working 50 because 'that's what's expected if you
want to go anywhere.'

~~~
bmelton
To be fair, I probably misstated. The average of working hours is ~37, which
doesn't necessarily mean that the average worker works that at all. It could
be the averages are between 40 hour weeks and 20 hour weeks, and that's where
it falls. Honestly, I don't know, nor was I attempting to ascribe motivation
to the numbers, except to point out that stated premise was factually
incorrect -- workers in the 50s did not work fewer hours, nor did they have
larger houses.

------
officemonkey
Everybody just loves the word "freedom," like it's some magical super-juice
which is the be-all and end-all of the American experience.

We will all be free of obligation, pain, responsibility, and any other
positive or negative thing soon enough. Instead of the pursuit of freedom, we
should dedicate ourselves to obligations that honor ourselves and others.

You don't really want "freedom," you want an obligation that you're excited
about, you want a responsibility you're eager to take on, you want a job you
love doing, you want a relationship that resonates with your values.

Everyone shorthands this to "freedom," and sooner or later that becomes the
goal instead of the individual obligations you're now able to pursue.

~~~
crusso
_Instead of the pursuit of freedom, we should dedicate ourselves to
obligations that honor ourselves and others_

Says you. I appreciate the freedom to sit at home and play a video game on a
Saturday without feeling compelled to meet the needs of others.

~~~
officemonkey
Sounds like you're honoring yourself. Carry on.

~~~
crusso
Sounds like you have issues where you feel the need to control others.

~~~
officemonkey
Sounds like you have issues where you project a lot.

------
birken
There is a really great article in _The Atlantic_ (from 2011) called "Secret
Fears of the Super-Rich" on this topic:

Excerpt: _The respondents turn out to be a generally dissatisfied lot, whose
money has contributed to deep anxieties involving love, work, and family.
Indeed, they are frequently dissatisfied even with their sizable fortunes.
Most of them still do not consider themselves financially secure; for that,
they say, they would require on average one-quarter more wealth than they
currently possess. (Remember: this is a population with assets in the tens of
millions of dollars and above.)_

Link:
[http://www.theatlantic.com/magazine/archive/2011/04/secret-f...](http://www.theatlantic.com/magazine/archive/2011/04/secret-
fears-of-the-super-rich/308419/?single_page=true)

~~~
rahimnathwani
I recall a colleague once (~10 years ago) telling me that some people he knew
felt that 5k GBP would be enough to solve all of their (money) worries.

I thought it absurd, i.e. too low given things like planning for old age. I
guess there are people who would think my estimate too low if I said I needed
5m for the same purpose. (not saying 5m is the right number for me or anyone
else.)

~~~
paraschopra
One of the projects I want to do is to map living expenses, inflation and life
expectancy to know exactly how much money is "enough". My problem is that we
forget that we tomorrow should be more valuable to us than today and by the
time we get this realization, we might have lost many years (of adulthood).

~~~
vanderZwan
Based on the following research, I guess $75K?

[http://www.npr.org/blogs/money/2010/09/07/129703291/new-
stud...](http://www.npr.org/blogs/money/2010/09/07/129703291/new-study-high-
incomes-don-t-bring-you-happiness)

~~~
base698
For me personally I know it's way more than $75k but less than $200k. I have
expensive hobbies and like to to travel without blowing my savings.

~~~
sliverstorm
Of course expensive hobbies require more money. However the point of that
article is (vaguely and generally across the people they studied) your
expensive hobbies and traveling do not increase your happiness as much as the
pursuit of the extra money decreases it. In other words, you get some
combination of diminishing returns on happiness per dollar, and increasing
cost of happiness per dollar. $75k is the proposed sweet-spot, where happiness
gained per dollar spent is still high and happiness lost per dollar earned is
still low to moderate.

~~~
kazagistar
The study says no such thing. It only makes claims about averages, not about
individuals, just like every other study.

~~~
sliverstorm
Right, the study does not say exactly those things about individuals; I'm
loosely extending those conclusions to the individual poster, to help my
parent understand what the study means and why it suggests $75k is more happy
than $200k. After all, it is not immediately obvious why $200k wouldn't be
more happy than $75k- isn't $200k more money? Doesn't more money always make
you happier?

------
kamaal
>>A life spent mostly hoarding money and possessions is a wasted life

Having seen the kind of advantage some of my friends born in rich families
enjoy, I would love to hoard and posses tons of wealth even if its purely to
give away in inheritance.

Rich kids enjoy privileges and advantage poor kids can't even dream of. The
biggest of which is attitude of course. Rich kids are born with an assumption
they are supposed to remain rich forever, become leaders and are free to act
as unfair as they want given the their 'natural selection' in becoming rich.

No matter how hard you work, you will never be able to truly compete with a
rich kid. He will get all the resources, tutions, fee and expenses taken care
of to establish a more deeply entrenched position of advantage.

The only real way is for you to exactly do what their parents did, and hope
your kids will be better off.

>>Then why do we run after money?

Which brings me to the point, why did you start a company?

Speaking purely from a philosophical point. There have been people in India,
especially wandering monks who shown you can find all the bliss in life even
on bare minimal survival gear. And there is no way you can match their
freedom.

~~~
base698
I think you've missed the point. The point is there is some amount of money
that affords you the ability to do what you want.

Possessions have the effect of tying you down. Buying a house, assuming you
get a mortgage, is a huge expense requiring you to work to pay for it. It ties
you to one geographical area and puts stress from having to make the payments.
You could spend the downpayment on a house as a down payment of yourself. Find
somewhere or something you'd rather do.

~~~
waylandsmithers
| Possessions have the effect of tying you down.

This is getting to be a little off topic, but I see comments like this often
from people who imagine a mortgage as a massive amount of debt hanging over
your head. While I agree that home ownership is not the right move for
everyone, and it's definitely true that you can't just up and leave, you can
sell your house. It will probably take longer than the 30 or 60 days notice
you would have to give to a landlord, but it's not as if you are signing a
contract to live there for the next 30 years.

| Buying a house, assuming you get a mortgage, is a huge expense requiring you
to work to pay for it.

Doesn't rent fit that description too? Unless you are crashing on someone's
couch or living with your parents, housing is going to cost something. In my
experience, first+last+deposit was the standard amount due upon moving in. At
the end of the day you at least get to keep some of the money paid on a
mortgage. Plus, if you do make it to the end of the loan, you could be paying
the same monthly payment that you locked in 30 years ago, whereas rent will
probably rise over time.

~~~
philwelch
If you're moving, it's likely because the house you live in has become less
desirable for some reason, like "all the jobs are gone". So in most cases, if
you want to move you're also likely to have trouble selling your house.

As far as investment value goes, it goes against every rule of investment to
hold a highly leveraged position in a single, undiversified asset. If you can
own several houses you might be okay.

------
Joeboy
A few years ago, after spending most of my adult life in voluntary-ish poverty
I decided to spend a few years earning proper money. By which I mean,
significantly more than my first world country's average salary but still
peanuts in HN terms. The main differences it's made to me are:

1) I can afford to buy a home, which I expect to remove a large amount of
bullshit from my life and makes me feel more secure about my future.

2) When my computer / bicycle / phone / printer / washing machine etc fails I
can get the problem fixed without significant disruption to my life. This is
probably a much bigger deal than anybody who's always been able to find money
for these things realises.

4) It feels good to know I have earning ability if I put the effort in.

5) It's nice to be able to buy stuff, occasionally.

~~~
dsirijus
I went a similar road (from $50 a month in an underground windowless garage
with no utilities whatsoever, to a 200m2 penthouse).

I'd put an accent on your point #2 - it really makes a huge difference to just
shoot up some money into trivialities and mundane annoyances in your life just
to make them magically go away. Because there's so many of them, most cannot
afford that.

I'd like to add a point though, maybe the most important in my list.

6) increased appeal to other sex.

And as far as buying stuff goes, all my wordly posessions fit in one box less
than in this picture
[https://www.dropbox.com/s/us8bavsdjldd029/2013-08-16%2005.42...](https://www.dropbox.com/s/us8bavsdjldd029/2013-08-16%2005.42.28.jpg)

~~~
hkmurakami
Was #6 because of how you dressed, or because you could host events at your
new place, or some other factors?

I'm curious since I have some acquaintances who are morbidly afraid of having
members of the opposite sex approach them for their substantial wealth. They
go out of their way to mask their material status.

~~~
gaius
There's a difference between _having_ money, which appeals only to the most
shallow, and _making_ money, which is a proxy for a range of universally
desirable attributes (motivation, confidence, tenacity, intelligence, etc).

~~~
Joeboy
In my case making money correlated only with my willingness to be a capitalist
drone for a few years. The attributes you mention surely correlate with
success at most things. Admittedly money is quite popular, so assuming that
its pursuit is a primary goal for everybody is probably not a terrible
approximation of reality.

~~~
gaius
Sure, it's just a proxy signal. But don't discount "willingness to be a
capitalist drone for a few years". For many people, taking on a multi-year
commitment and seeing it through is beyond them. Such a signal would be
attractive to someone who wanted kids, for example.

------
graeme
Freedom has been my main goal for money. As my business has grown I'm happier,
but I can see the monetary goalposts shifting as I go.

I started two years ago. My initial goal was to build recurring income. I
wanted enough to cover expenses, as an initial goal.

Achieved that. But I saw I was vulnerable to sudden expenses, or a temporary
decline in business. So I wanted an emergency fund.

Achieved that. But then I realized I had student loan debt that I would soon
have to pay interest on, as I was earning more money and wouldn't qualify for
debt relief in the near future.

Had a really good autumn and achieved that. Then I noticed that I might have
to pay more taxes, because my previous tuition tax credits may run out in
2013.

Achieved that, which brings me to the present. I only achieved much of that
savings through tutoring. I charge a high rate, but it's not scaleable. So now
my current goal is increasingly recurring revenue so that I don't have to sell
my time directly.

Why am I writing this? At each one of these stages, I had the feeling "If I
just achieve this goal, I'll have enough". It was a silly belief in retrospect
– it would have been obvious to an outsider that I still had challenges to
overcome.

Yet presently, I have the feeling "if I double my recurring income, I'll have
enough". But I'm certain that once I achieve this goal, I'll see another
reason I ought to earn more. Probably the next goal will be "if I just achieve
X, I can make work optional by age 33" or "if I just earn X, I won't have to
worry about the cost of airfare for trips".

I can attest that life IS better now that I've met the goals I listed above. I
remember having lots of worries about money that have mostly dissipated. I
haven't increased my lifestyle, and have been trying to keep "freedom" as the
main goal for earning more money.

But the whole process feels shockingly short-sighted. It's as though I'm
incapable of imagining how I will feel if I am earning $X or have saved $X.

~~~
suhastech
[http://en.wikipedia.org/wiki/Hedonic_treadmill](http://en.wikipedia.org/wiki/Hedonic_treadmill)

------
downandout
The importance of money is a matter of perspective. Anyone that has the
author's attitude toward money has never been poor. Ask a homeless person, or
any of the 50% of the US population that has a net worth of zero or less what
their opinion on money is, and it will be markedly different than the
author's. The opinion that money doesn't matter is a luxury that only the
wealthy can afford.

~~~
yummyfajitas
The author is from India. Based on that fact, there is a 95% chance that he
lived most of his life in poverty comparable to the bottom 5% of Americans.

See figure 7: [http://www-
wds.worldbank.org/external/default/WDSContentServ...](http://www-
wds.worldbank.org/external/default/WDSContentServer/IW3P/IB/2012/11/06/000158349_20121106085546/Rendered/PDF/wps6259.pdf)

It's also worth noting that he's writing this from the perspective of a far
more materialistic and status-based society than the US.

~~~
downandout
He actually mentioned in the article that he grew up "middle class". I am
aware that middle class in India may be different than in the US, but it is
clear that he was never poor - going to bed hungry etc.

~~~
yummyfajitas
"Middle class" in India does not mean what you seem to think. The vast
majority of middle class Indians are poorer than most Americans living in
poverty.

Read my link - 95% of Indians are poorer than the bottom 5% of Americans.
Unless the author defines "middle class" as "top 2%", the fact that he grew up
"middle class" is meaningless when comparing his lifestyle to an American one.

A stat to illustrate the point - 1.8% of India (circa 2009) owns a car, likely
one that would be too dangerous to sell in the US. For comparison, 25% of
American households below the poverty line own _2 cars_ and 75% own one.

[http://en.wikipedia.org/wiki/List_of_countries_by_vehicles_p...](http://en.wikipedia.org/wiki/List_of_countries_by_vehicles_per_capita)

[http://www.census.gov/prod/2008pubs/h150-07.pdf](http://www.census.gov/prod/2008pubs/h150-07.pdf)

The bottom 50% of America you described, or even the bottom 5%, also does not
go to bed hungry.

~~~
guard-of-terra
"Poorer" doesn't mean much. First of all, you should factor in purchasing
power; second, constant expenses which are the killer.

In most countries, especially poorer ones, you don't have to own a car to be
in the middle class. Neither you have to pay for gas, car itself and
parking/garage. You can realistically move by foot and/or mass transit.

Disclaimer: I think I'm in top 5% in my country, probably earn more than USA
median and I never had a car.

~~~
yummyfajitas
Clearly you still haven't read the link I provided, which provides numbers
_after adjusting for purchasing power_.

I'd provide you with more statistics showing how wealthy poor Americans are
([http://www.census.gov/prod/2008pubs/h150-07.pdf](http://www.census.gov/prod/2008pubs/h150-07.pdf)),
but clearly you aren't going to read any numbers.

So instead, go watch about 4 minutes of Delhi Belly (good movie, BTW, vastly
better than typical Bollywood crap) which always confuses first world types:

[http://www.youtube.com/watch?v=IrJS6R-FT-o](http://www.youtube.com/watch?v=IrJS6R-FT-o)

(Sorry, couldn't find the whole scene in one video)

[http://www.youtube.com/watch?v=L3dkCVXcAVg](http://www.youtube.com/watch?v=L3dkCVXcAVg)

That's life for middle class professionals. (Admittedly, a group of non-
misfits would have filled the buckets.)

~~~
guard-of-terra
What's so terribly wrong about those scenes? After applying cinema discount.

They don't drink your juice in the USA?

I will pick middle-class Indian over poor American every day, because: you
won't get shot, you won't land in prison, you won't have to work three jobs
for funny money, you'll have a real family and your children won't do drugs.

Instead you'll be raking in some respect.

~~~
JoeAltmaier
I live in Iowa; those things you mention are the comic-book version of
America. Nobody is shooting anybody around here; only college students end up
in jail, overnight, when they leave the bars at 2AM and wander in the streets
and might hurt themselves.

~~~
guard-of-terra
Comic book or statistics?

I guess that mainland states' countryside is one thing and urban poverty in
large cities is another thing. One more reason to take income rankings with a
grain of salt. As a preedictor of lifestyle.

~~~
JoeAltmaier
Oh, and a guy got arrested yesterday when he waved a gun around trying to
steal a pair of gloves from a local farm store. Since its -14 degrees F this
morning, I have some sympathy for the poor guy.

------
egypturnash
Yeah, I think I largely agree with this.

A few years ago, my grandmother died and left me a healthy pile of money.
Enough that I don't have to have a day job for several years yet, even if I
hadn't invested a bunch of it.

I live alone in a two-bedroom apartment in a very walkable part of Seattle. I
don't own a car, I don't have kids. I spend my days mostly drawing comics,
without troubling myself much with deadlines, or whether they're "what the
market wants" \- I'm two years into a complex and ambitious comic about a
lesbian robot lady with reality problems because it's a story I want to tell.

I have the freedom to do this instead of grinding out commissions, working as
a minor cog in animation or games, or doing weird web-dev things in the
intersection of "good artist, half-assed programmer". And I have this freedom
because of money. I can afford to travel to several comic book conventions
every year and make enough to at least cover my costs, and not stress when a
new con turns out to have sales so shitty that I walk away from the last day
to hit the beach instead.

It is fucking awesome and I really hope I can continue to enjoy this freedom
for a very long time.

~~~
simonswords82
Sounds like an amazing lifestyle, I'd love to see some of your work

~~~
egypturnash
It's pretty much all available free here:
[http://egypt.urnash.com](http://egypt.urnash.com)

And yeah, it's a pretty good life if you can get lucky enough to have the
money to do it.

------
forgottenpaswrd
When you know self made millionaires you learn one thing:

"Money is not wealth". Almost nobody that understands wealth holds money,
money is a tool for exchanging things and its value decreases with time.

They hold real state, they hold precious metals, they hold stock, they travel,
they know people.

The people that made money usually like making wealth and don't fear losing it
so much, they learn all their life to handle risk with positive results. It is
their children or grandchildren who fear it, because they don't.

The good thing about being rich is that you could be poor whenever you want.
You could also help lots of people in your life, which feels amazing.

~~~
rwmj
The one thing I learned from working with a couple of very rich people was
that _all they think about is how to get money_.

Which is why I'm never going to be super-rich, because I don't really care
about it obsessionally like those two did.

Edit: I should say these were self-made millionaires. I have also worked with
people who were millionaires just by being in the right place at the right
time, and they were completely different and rather careless with money.

~~~
theorique
This is true. The self-made multimillionaires that I've met and worked with
don't just "turn it off" because they've made it. The habits and practices
that got them there are something that they carry with them.

Now, of course, they structure their lives so that they work when they want,
where they want, and build in a lot of time and space for enjoying the things
they enjoy (Superbowl tickets? Vacation with family on the water? Of course.)
But they also work a _lot_.

------
AndrewKemendo
This article and the bulk of the comments strike me as shortsighted. Money is
the driver of industry. The more you have, the more you can direct resources
towards productive activity.

The idea of money being freedom is a great comparison, which I make myself
often. The OP and others here however largely limit their notions to
hedonistic freedoms and critiquing buying "things."

What about building that school or the playground in the neighborhood that
can't afford it? What about funding fundamental research that is under funded
right now? What about starting a job training program for the under employed.

No, there is no such thing as too much money because there is no end to the
things that need to be done in the world. So the whole conversation about
enough is baffling.

~~~
JoeAltmaier
Enough for an individual and enough for a community are different. I as an
individual am not building any schools, because it would take many times my
lifetime income and dominate my entire existence. Some people are born
industrialists; the rest of us want our weekends and family.

------
tluyben2
After working very hard on things to 'make money' (no goal attached, just
making money, boy I was naive) doing stuff I really didn't like to do
(building large EJB based systems for banks/insurance and we had entity beans
back then!), I had some realisation that actually, this sucks. I alienated my
gf at the time, my friends, my family. I worked, 200+ people under me and it
sucked. I thought about it a few days, sold off some stock to make sure I
could have freedom.

Which I also believe is the main goal of having money. No loans/mortgages,
being able to do what you want. And then I started making companies again,
doing about the same thing (without the entity beans, or beans at all :), but
now it's fun. If it goes badly (the current crisis almost bankrupted one of my
companies) I handle it like you are supposed to handle it; in a calculated,
company-first, manner. And pull through stronger than before. If you don't
have that freedom, you make decisions which often don't reflect the best
interest of the company because, well, you cannot pay the rent or feed your
family.

I always believed in lots of interests and hobbies (my twitter feed must seem
rather ADD, but I actually have a planned working day in which I get to do
those things) as I think the biggest waste of life you can have is boredom and
now I actually get to make companies around those things. Money in the bank
gives you the balls and the contacts to do that while as before that wasn't
even an option without right-out prostituting yourself. And the freedom to say
no to something which would before have been (or have seemed like) a brilliant
opportunity because you just don't want to.

Freedom usually (unless there are health issues in your family/close friends)
also buys you no stress which already comes from the above. But having my own
fruit/vegetable garden and having the time to prune the trees and prepare nice
food from it etc is very far removed from shit in styrofoam containers and not
even tasting it during a client conference call.

Edit: I forgot my new-found pet peeve with getting older; people get _way_ to
serious over 30. Life's a game and a short ride; money allows you to live it
like that.

------
ar7hur
I'm surprised nobody has quoted Jean-Jacques Rousseau on money:

 _I love liberty, and I loathe constraint, dependence, and all their kindred
annoyances. As long as my purse contains money it secures my independence, and
exempts me from the trouble of seeking other money, a trouble of which I have
always had a perfect horror; and the dread of seeing the end of my
independence, makes me proportionately unwilling to part with my money.

The money that we possess is the instrument of liberty, that which we lack and
strive to obtain is the instrument of slavery._

He did not have a blog, but he did know how to say a lot with just a few
words!

------
dnautics
By corollary, individual debt is fractional, voluntary slavery.

Or possibly it goes the other way. By being wealthy the truest freedom you
enjoy is not having to worry about owing anyone anything.

------
mpweiher
"Money is coined freedom" \- Fyodor Dostoevsky.

------
Tycho
Another perspective I read recently is that 'time is the ultimate form of
wealth.' Meaning that if you have a lot of money, you don't need to spend your
time on things which do not interest you.

------
malandrew
The entire basis of money is a Pareto Optimality, thus I would amend that
statement to be "The real use of money is to buy freedom at someone else's
expense."

Now it's also possibly that if we view money through the lens of a Nash
equilibrium, that in the long term we are doing what is best for all of us by
constantly seeking greater productivity. Therefore, "On a long enough time
scale, the real use of money is to buy freedom for every one as money is
traded with those that can achieve the greatest productivity." Money is the
lubricant that permits the human machine to find the most efficient means of
production.

~~~
dnautics
you should read Debt: the first 5000 years, and you will find that you are
wrong; the entire basis of money is NOT Pareto Optimality. The author of this
book I think makes a criticism that the economic just-so story of money exists
to self-justify economics as a field (while conveniently ignoring that he's
doing the same thing for anthropology) but the book is nonetheless an
excellent treatment of the muddled history of money.

------
ashray
Great post Paras. However, I wish you would have addressed what you do with
your new found financial freedom. I suppose running your business takes up
most of your time. That's fine as long as it's enjoyable I guess.

The question here is, if something, what would you have done differently ? Or,
going forward, what are you going to do differently ?

Also, the modern economy is poised against us in terms of preserving the value
of our wealth. Because of this, I disagree with your final conclusion (the
sweating over investments bit..). The hard part about money is making it, but
it's also hard to keep it. Inflation eats away at what you have, furthermore,
depending on your country (India in this case..) you don't have 250 years of
documented economic history to make your investment decisions.

If you've reached your financial goal, mine is 25x of annual expenses then
yes, maybe you are truly financially independent and now free. You have
literally bought freedom. You're right, materialistic pursuits will probably
never lead to happiness. However, for some the road to financial independence
is longer than others. And yes, many people lose the plot along the way ;)

Maybe a more apt title for your post would be: "Having a successful business
and a good amount of money buys you freedom" ? :)

~~~
paraschopra
There's an interesting thread on Quora titled 'What does it feel like to be a
self-made millionaire under the age of 25?' [http://www.quora.com/Becoming-a-
Millionaire/What-does-it-fee...](http://www.quora.com/Becoming-a-
Millionaire/What-does-it-feel-like-to-be-a-self-made-millionaire-under-the-
age-of-25?share=1)

As you will read through it, terms like insecurity, worry, surprise on
unchanged happiness levels would be quite common among the answers.

I have been thinking a lot about investments and have concluded that my main
criteria is minimum management. If an investment requires active maintenance
and management, it's not for me (unless I'm doing it for charity). This
excludes many common investments such real estate and stocks. With others (say
fixed deposits, metals, etc.) the post-tax returns are less than inflation so
it may not be wise. Right now I have decided to invest mostly in mutual funds.

I'm okay with the risk because the biggest asset I have is myself. The
insecurity about future never leaves us, but as long as I believe that I would
be employable in future, I can always jump back.

EDIT: added ?share=1 to the URL. Thanks Casseres.

~~~
ashray
Thanks for your response, the Quora thread is very interesting.

Another question, and this is a little more personal. Also, I don't mean to be
accusatory at all or anything of that sort so please don't take it that way.

Do you feel any new found desire to help those less fortunate than you ? I
don't mean by providing employment, etc. I'm sure you do plenty of that
through your business.

I just know plenty of fairly rich people who feel like they're not 'rich
enough' to help those that are less fortunate (even people whose net worth is
in the tens of millions!)

------
mil3s
Paras,

I enjoyed your article. I too grew up in a middle class family, much the same
as you. I was taught to work hard and to use good motives when working.

I remember early on, deciding not to take part in activities because I just
focused on the money, I was 16 years old. I consider it unfortunate that I
repeated that decision many times until my late 30's.

Looking back I missed out on many of the experiences that later brought me
much joy.

So now what?

I try to focus on the experiences, instead of just getting the money. I have
experimented with less money, and the joy was still there. However I still
need money, I still want and work to be comfortable. " I work with many that
just focus on the money and point out that "with so much money you can do good
for others." I think you can do good for others before you get 'the big pot at
the end of the rainbow.'

Keep sharing.

------
trimbo
The parable of the fisherman and the investment banker.

[http://popculturemeetspsychology.blogspot.com/2011/06/invest...](http://popculturemeetspsychology.blogspot.com/2011/06/investment-
banker-fisherman-parable.html)

------
privong
> And, although it might be true that certain people just get kicks out of
> making money, science definitely tells us that certain things make us
> predictably more happy than others. So people who are irrationally attracted
> to hoard are just victims of uninformed biases.

While the statement on science is accurate, those kinds of results are
statistical. So, it's incorrect to extend that result to every individual.
While people who chase money may be statistically likely to be "victims of
uninformed biases", not everyone will be.

------
yetanotherphd
I liked this article because unlike many on this topic the author's viewpoint
was fairly nuanced. However I still think the author goes too far in his
claims of how useless money is.

First, raising children is very expensive, and to put 2 or 3 kids through
college requires a lot of money. And most single people would like to have a
family at some point, so they need no excuse for saving money.

Second, money (and conspicuous consumption) is a social signal, and
demonstrates your ability to earn that money, which not everyone can do.

~~~
benched
I can only just barely imagine the things you're talking about as real things
that really happen. Surely they can only happen to other people - to another
class of people. My parents didn't put any of us through college. I don't have
a family and don't expect to. Sometimes I forget these things are real for
some people. I think of them the same way most people think of fame and
riches.

------
alexeisadeski3
The real use of money is to pay taxes.

------
pmelendez
I thought deeply about this when I read something that Bill Gates said
answering a question a while ago. At some point he said that he could
understand that people wants to be millionaire because the freedom that
brings, but after a threshold the burger is the same for everybody.

Freedom in that context is a weird concept, specially when you see a lot of
rich people that are slaves of money. I guess it depends on the personality.

~~~
jbeda
That quote made a big impressions to me also. It was from a Q&A session at UW
from late 2011. Here is a video: [http://www.geekwire.com/2011/its-hamburger-
insights-bill-gat...](http://www.geekwire.com/2011/its-hamburger-insights-
bill-gates/)

~~~
pmelendez
Thanks! :)

------
melling
"A man is a success if he gets up in the morning and gets to bed at night, and
in between he does what he wants to do." \- Bob Dylan

------
mcgwiz
Overall, I agree with the post.

> The freedom to do whatever one wants, wherever one wants (within moral
> limits, I hope).

This overreaches. You cannot do "whatever," "wherever". This implies complete
control over one's circumstances, which is obviously absurd.

More precisely, money buys increased control over your circumstances and life.
This is very valuable and empowering, but it is clearly limited.

------
monkeyspaw
>A life spent mostly hoarding money and possessions is a wasted life

I find it interesting that an article whose tone is one of optimism is so
judgmental.

~~~
ashray
I think the takeaway is that life would be best spent finding out what it is
that truly makes you happy and then pursuing that. A lot of people think 'more
money' is the answer to that.

More money is just a way to be able to pursue whatever you think will truly
make you happy. Whether that's kayaking, kung-fu, dancing, golfing, getting
laid, going out for dinner, going on vacation, etc.

A means, not the end.

Some people just lose the plot on the way and continue down the more money
path forever. Those are the people who end up living to work and not working
to live.

~~~
lucaspiller
> A lot of people think 'more money' is the answer to that.

I'm don't believe this is true, at least directly. I believe people start out
thinking that they just need to make X amount of money to fulfil their dreams.
The problem is once they start earning money they start changing their
lifestyle to match it. Once they are in this situation it is hard to give up
the restaurants, cars and houses to chase their dream. As such they decide
they want fancier restaurants, fancier cars and even bigger houses which
requires more money. It's sad, but people who are comfortable are unlikely to
change much, even if the result would make them a lot happier.

------
clarky07
I really like the idea of money as freedom. I'll take it a step further
though, and that is the ability to generate at least somewhat passive income
whether from a business or from investments. Not having to make money right
now is key to freedom.

------
vijayr
_We don’t make movies to make money, we make money to make more movies_

\- Walt Disney

~~~
MichaelGG
Heh. Not anymore: Disney implements a "vault", where they stop selling movies
for a certain amount of time in order to drive new sales when they re-release.

~~~
ghaff
Disney was doing that with theatrical re-releases long before there was such a
thing as a VCR--much less a DVD.

------
keiferski
Although I'm nowhere near financial freedom, I've been wondering lately what
"freedom" means in a strictly material sense. Inflation, bad investments, etc.
can eat away at a bank account. But material objects seem to be more secure.
The problem, of course, is balancing this need for reliable physical
possessions with my (and many other's) minimalistic tendencies and general
dislike of "stuff".

Here's what I've got so far:

\- a nice house in a nice neighborhood, tricked out with the best in security,
fitness, intellectual and entertainment devices. Add in renewable energy
sources via windmills/solar panels/ etc to truly be self-sufficient.

\- enough canned food and rice to last multiple lifetimes.

------
VladRussian2
buy freedom? from whom are you going to buy it? who has a freedom for sale? do
they have excess supply of it? or would they build a one for you? or are they
going to sale you their own one?

------
jonsleet
The "real" use of money is dominance. Between you and the things you need or
want, money is a proxy controlling access to those things. Control the money,
control the people.

------
vorg
If you need money to buy it, it's not freedom, it's power.

------
patmcdonald
Disagree. Money does not equal freedom. I know plenty of poor people who live
freely and plenty of wealthy people who feel trapped. What money really is is
a placeholder for time.

------
tonylemesmer
It's possible to go to Antarctica with someone else's money. That's the
satisfying thing. Make it a win-win arrangement (I'm not talking about
freeloading).

~~~
yetanotherphd
What are you talking about then?

------
jwatte
There are two scarce resources: human lifetime, and mineral resources. Money
lets you assign the disposition of some of those.

------
spacecadet
"money only buys you choices" I lived nearly homeless for a year. never felt
more free, didnt cost a dime.

------
koshak
strange that here's such a hype around this article. Money is a tool. That's
it. Use that tool. If you begin to worship a hammer, you're fucked. If you see
people who are fucked, help them for the first time. If you see that they like
being fucked, then these people are tool. Use that tool.

------
blazespin
The real use of money is to fund your next startup!

------
glurgann
I'm kind of disappointed, I was hoping for a bit more than a "rich people get
obsessed with getting richer" type of story (still a good piece).

Freedom is indeed bought with money, but not in the way that most people
think. There's a shell game going on right now for the lowest class worker.

At the time the US economy had it's "oh shit" moment around 2007-2008, I was
working at a marketing research company. At the time I was working from home
being paid by the hour, but there wasn't a lot of work coming in. I was broke
most times after paying bills, so I had to find a quick patch job.

I began working at a McDonald's. At this point I was staying available online
for most of the day until the afternoon, at which I would go to McDonald's and
work all night. I found a bartender gig and started to work that on my off
days of McDonald's.

At that point, I was making good money, but there wasn't any time I had to
myself. I ended up quitting the marketing research job, as I was making more
from McDonald's alone.

Now I was making OK money, but still not having a single day off. The
bartender gig was getting more and more violent (I worked at a rough R&B club
getting paid under the table). I eventually left the bartending job (there was
a shooting there less than a week later). I don't think I need to explain what
life was like working only at McDonald's, even if I was being paid more than
most non-managers.

It's a bit hard to communicate what was exactly wrong with this picture. As a
low wage worker, it was impossible for me to both have time and money, or
leverage either of them to get myself into a better position.

When I had money, I had no time to leverage it. I couldn't finish a degree, I
couldn't even keep a girlfriend. It was easy to slip into depression and
substance abuse. I drank a lot. When I did get the chance to go out and have
fun, it was to the extreme.

When I didn't have money but I had time, it was equally as bad. I couldn't go
out to bars, I barely could keep up on bills. I couldn't take time off to go
to the doctor. I couldn't afford to lose hours, nor afford the doctor's visit.
When I had to go to the emergency room, I had to take the hit to my credit. I
couldn't go across town or go to the show, I was behind on either electric or
gas most months. And electric people have no qualms in shutting off your power
and then laughing in your face when you say you can't even cook food.

It's interesting to me that when you're in that trap, it's almost impossible
to pull yourself out. On one end of the spectrum, if you have the money to
better yourself, you don't have the time to do so. You can't leverage the
three jobs on resumes, nor is that a replacement for a degree.

On the other end, if you work one or two jobs, you don't have money enough to
get a degree, or take a vacation, or take sick days, or go to the doctor, or
change cities, or go to a concert, or have a night on the town, or even
(sometimes) keeping internet.

So yes, I would argue that the real use of money is to buy freedom. It's just
that most don't realize it, until they are stuck at the very bottom wondering
how the hell they can get out. I'm not saying I did everything perfect, but I
don't feel I did anything horribly wrong either.

And I'm doing fine now. I ended up getting with a start up doing Node.js and
frontend JS work, which was enough to jump start my career.

EDIT: And yes, technically I'm falling into a logical fallacy here:
[https://yourlogicalfallacyis.com/anecdotal](https://yourlogicalfallacyis.com/anecdotal)

~~~
Artistry121
I did some analysis of the basic costs of living in Austin, TX for a minimum
wage worker and found if fairly good decisions are made about $2000 a year can
be saved at 40 hours of work a week 50 weeks a year.

How much money were you spending on alcohol and the few times you went out
"crazy"? Substance abuse sounds like a few beers a night - costing $20 a week
or so? That's two hours of free time (closer to three) a week.

I would really like to see a breakdown of your expenses during that period of
your life.

~~~
glurgann
And I really couldn't give one, at least in this setting. And really I've yet
to see a good estimate for cost of living. Full time in minimum wage-land is
35 scheduled hours, less if you are let go early. Getting behind on bills also
constitutes additional fees.

As far as what I remember, I ended up having about $100-150 left after bills
per pay period. There are other factors here as well, bad roommate, car
accident, that I'm not going into.

------
gprasanth
"the pieces of green paper have value because everybody thinks they have
value."

Freedom is fallacy.

~~~
Alexx
Those two statements don't really connect.

Money has value because people think it does, but also because it represents
economic value. Once you can buy enough economic output to sit at the top of
maslow's triangle then you're free to pursue whatever arbitrary things you
please.

It's not an abstract concept, it's a cold hard fact that's held true for
centuries.

------
beto96
totally agree

------
zhijiasun
quite agree

------
guard-of-terra
My take: I really need to own a good apartment. Half commute time is a life
changer; not having to cough up rent every month is a life changer; being able
to rent it out and move to Southeast Asia and/or get unlimited run time for
project/business/startup is a life changer.

Once this is accomplished I never strictly 'need' to work unless I need
something extravagant or more savings or family :) In theory anyway.

------
jbeja
Good post, but what i don't find to get is the assumption that having or not
money fall in some sort of polarity context: "Having money is bad or good?",
Neither is something that is needed just that.

------
andyl
Money is an enormous source of suffering. Worldly life and the pursuit of
money is a hamster wheel. Poverty and service is the only freedom. I'm not
kidding.

