Summary

The article advocates for a more empathetic and empowering approach to personal finance, emphasizing that managing money effectively is not about outliving your resources but about finding a lifestyle that aligns with your financial means and goals.

Abstract

The article critiques the traditional fear-based narrative of retirement planning, which focuses on the anxiety of "outliving your money." It argues that such an approach is counterproductive and disempowering. Instead, the author suggests that providing options and agency in financial planning can lead to better outcomes, much like the authoritative parenting style that offers choices while guiding decision-making. The author posits that there is no one-size-fits-all method to personal finance and that flexibility and personal circumstance should dictate financial strategies. The article emphasizes the importance of considering individual needs and lifestyles when planning for the future, advocating for a diverse range of financial paths that can lead to a fulfilling life without the stress of a "race" against time and money.

Opinions

The phrase "outliving your money" is seen as negative and anxiety-inducing, lacking empowerment and self-awareness.
The authoritarian approach to financial planning, which dictates a singular path, is ineffective and mirrors an authoritarian parenting style.
An authoritative approach that provides options is preferred, as it gives people hope and empowers them to make their own decisions.
The standard educational model is compared to the restrictive traditional financial planning, suggesting that alternative methods can be more suitable for certain individuals.
The article rejects the notion that there is a single correct way to manage money, emphasizing that financial planning should be adaptable to different life circumstances and emotional factors.
The author stresses the importance of sharing personal experiences and failures to help others find relatable strategies for their own financial journeys.
Empathy, emotional writing, and self-awareness are key in financial advice, aiming not to frighten but to encourage and support readers in their financial lives.
The overarching opinion is that with the right approach and mindset, individuals can become competent with money and live a good life without the fear of running out of resources before they die.

How To Make Sure You Don’t Run Out of Money Before You Die

It’s way easier to do than the money gurus make it out to be

Words matter.

We (re)learned this much over the last five years.

However, it’s not just racist, homophobic, xenophobic, and misogynistic wannabe politicians who lack empathy and any drip of decency. Even those with good intentions make horrible word choices that stick.

Case in point from a recent Making of a Millionaire article:

Let’s do away with the old concern of “outliving your money.”

Who thought to phrase it this way in the first place? There’s nothing positive and empowering about those words. They trigger nothing but feelings of anxiety and near-certain failure.

I’m not sure who said this first and how we collectively decided to make it common parlance in personal finance and investing, but it doesn’t get any less self-aware than framing retirement planning as a race between your mortality and your money.

Why would you throw the fear of “outliving your money” into somebody’s face every day? What type of response do you think you’ll get, particularly from individuals and households struggling with or intimidated by money?

It’s akin to parenting by fear. It doesn’t work.

You want this perfect world where everybody’s willing and able to save for retirement, golf five rounds a week, and have vigorous sex well into their nineties.

It ain’t happening for a vast majority of the population.

If you think it is or can on a grand scale, you’re delusional.

This doesn’t mean we live among incapable fools. It means we’re not setting otherwise capable people up for success. We’re not modeling and advocating alternative ways to do life, especially when it comes to work and money.

Not to be all paternalistic, but consider parenting styles.

The authoritarian says this is how you’re gonna do it. You’re gonna drink from the blue cup, kid.

The authoritative parent says, here’s a blue cup, a red cup, and a turquoise cup. Take your pick, kid.

The permissive parent says you can drink that shit off of the floor or out of your brother’s belly button. Doesn’t matter to me.

In my experience (I have a 17-year old. I also have parents), the authoritative approach works best.

When you provide options, you give people agency. You give them hope. You empower them. You teach them how to make little decisions, which leads to one of life’s most important skills — being comfortable with big decisions. But it goes beyond this.

Being comfortable with life’s big decisions requires alternatives.

Think about schooling.

Until the pandemic, the predominant education style was to go to a brick and mortar building early in the morning, stay there all day, come home tired and hungry after some extracurricular activity, then do homework until it’s time for bed.

While online school hasn’t worked for a lot of kids, others now thrive.

Some kids aren’t suited to sit in a classroom at 8:00 a.m. They don’t function optimally on the standard school schedule. Yet, we chastise them when they fail inside this restrictive environment. We treat it like it’s the only way. If you can’t succeed in school — the way we have structured it — you’re never gonna succeed in life.

I call bull shit.

I know parents who, in March, became concerned. Oh my god, my kid is staying up until 4:00 a.m., spending the wee hours of the morning doing homework. This is not okay!

But why? Why isn’t it okay!? Especially when you discover this nocturnal schedule produces the best performance of your kid’s academic career.

A similar dynamic applies to personal finance and investing. There’s no one way to properly manage your money. There’s no one spending size that fits all. There’s no magic number you require to retire. There’s no rule that says you have to retire. There’s no law that says you don’t have to retire.

There’s a ballpark. Ideally, we’re all in the same ballpark. Maybe Dodger Stadium. We’re pounding beers and eating hot dogs. Outside of this, we have different ways of being. This is the world we ought to strive to live in.

From a financial planning perspective, we truly all exist in the same ballpark.

As Bernie Sanders stated so well the other night, whether you’re a progressive in New York City or a conservative in rural Kansas, you share core goals and desires. You want healthcare. You want a decent job. You want to make a good living. If you attain these things, you move to make your money work for you.

It’s not about outliving your money. It’s about your money keeping pace with your lifestyle. We discuss strategies here (and elsewhere on Medium) designed to achieve this goal. I have my ways. I experiment with other ways.

You might consider cash flow king. You might think freelance work is your ticket to a comfortable life, no matter how long you live. You might consider alternatives yet still opt for a more traditional path to retirement. Whatever.

This is the point. People like me can tell you how to do it. We just can’t tell you how to do it. Within every element of sound personal finance (emergency fund, rainy day fund, budgeting, spending, additional saving, investing, rent versus own), wiggle room exists. Lots of it. Wiggle room dictated by privilege, circumstance, your place in life, and emotion.

My only job is to share my experience, including the many failures. I work hard to make it relate and resonate. From there, you cherry-pick thoughts, ideas, and strategies to chart your own course.

I will never make you feel stupid. I read a lot of other authors who take the same or similar approach. They have empathy. They write with emotion. They’re vulnerable. They’re self-aware! They try to not use words that’ll freak you out.

From this perspective, you literally can write your own ticket.

It won’t be easy, but you can see the possibilities. The very real possibility that you can become better — even good — with money. That money can help you craft and sustain a good life. A life where you’re not running in an anxiety-ridden death march out of stride with your nest egg.

This article is for informational purposes only. It should not be considered Financial or Legal Advice. Not all information will be accurate. Consult a financial professional before making any major financial decisions.