The Difference Between
"Need" and
"Want"
by Craig Nathanson
by Craig Nathanson
Let's face it: Most people spend way too much money
on things they don't really need. The more money we make, the more we tend to
spend. This endless cycle of materialism has led many people to confuse the word
"need" with the word "want." As in, "we need a big-screen TV for our new home
theater." Or, "I need a new pair of shoes to go with my new
outfit."
If you want to achieve your vocational passion,
where every day you jump out of bed and can't wait to go to work, then you need
to re-order your priorities. Stay away from the purely material.
The pursuit of material success often is the root
cause of burnout at midlife. In fact, a recent study at the University of
California at Berkeley found that people primarily motivated by the love of
their work grow dissatisfied as they begin to make more money.
The first step to breaking free from the
materialism trap is to understand the difference between "need" and
"want."
We need food, clothing, shelter, reliable
transportation, education, enrichment, and the technology necessary to do our
work. Also, we need the occasional small indulgence to treat our children and
ourselves.
We do not need 500 cable TV channels, brand new
luxury cars, 5,000-square-foot homes in exclusive neighborhoods, lavish ski
vacations, and smart phones that do everything but think for us.
There is nothing wrong with wanting these things.
But understand that these things do not make us happy, in and of themselves.
And, they are often links in the chains that bind us to jobs we
despise.
Often, those who make a leap to vocational passion
end up making more money over the long term. But in the short term, income
usually declines. It may even go away for a period of time. Typically, the first
two years of a career change – in particular, one motivated purely by vocational
passion – are financially difficult. Major lifestyle and attitude adjustments
are critical to making the money last while you pursue your dream.
The amazing thing is that once you learn to live on
less, it becomes a habit. The peace of mind that comes from relying less on
materialism to define success usually leads to a greater and deeper
happiness.
Getting Real About
Money
So. Now we understand that pursuing vocational
passion requires a major adjustment in our attitude toward money and material
comfort. The next step is getting down to the details.
What does it take to transform yourself and your
family from a unit that consumes as much as it earns to one that respects money
and makes it last?
The trick is to look at all expenses, both big and
small. Leave no stone unturned. No savings is too small, and no category of
spending should be free from scrutiny.
Those looking to leave a job to pursue a vocational
passion face two core issues: raising enough money to fund a career change, and
changing spending patterns to make the money last. Raising the money can be a
tremendous challenge, depending on your financial resources. Savings, bonds,
securities, IRAs, home equity, jewelry, valuables, and family resources are all
avenues for raising capital to sustain your family during this
transition.
Consider these options to cut down your burn rate.
Some will seem dramatic. But if you have decided that your only chance at
happiness is to pursue a vocational dream, small measures won’t cut
it.
• If you live in a “McMansion,” consider
selling it. You could use the proceeds to buy a smaller house in a less
expensive neighborhood. That would leave you with no mortgage or a much smaller
“nut” to make each month. Whatever the size of your home, you can go a step
further and use 100% of the proceeds of a home sale as working cash for the
transition, then rent a house instead. Seeking the advice of a tax attorney or a
financial planner may be wise, particularly when you are selling your home or
using it as security on a loan. But, do not let these advisers sway you from
your core decisions. They are there only to give you advice on the smartest way
to pursue the path you have chosen.
• Consider part-time or project-based work in
the field you are moving out of to supplement your income during the transition.
Also, look generally to part-time work as a way to slow your burn rate. Ask each
eligible member of your family to contribute toward supporting the
household.
• Evaluate your home, car, and health
insurance costs. Are you over-insured? Can you raise your deductibles? This
often can reduce premiums significantly. Also, health insurance rates for small
businesses, even those with one or two employees, are often more favorable than
individual policies.
• Take a look at what you drive. Is it a
“badge” brand imported car? Is it a “suburban assault vehicle?” There are many
presentable, economical cars with good long-term reliability that can be
purchased used. Sell your status symbol and buy one of these other cars instead.
You will save on car payments, gas and insurance. You will be better off the
minute you stop trying to impress people with what you drive.
• Let your children fund a little more of
their own college education. Student loans are not a lifelong burden, and in
fact many successful people have paid for their education this way. So can your
children. They will still love you.
• Sweat the small stuff. Look at every
element of your daily spending and ask whether it is necessary. Do you have
features on your phone service that you never use? How many videos do you rent
every week? (They are free at the local library, by the way.) How important are
those premium cable channels? How many pizzas did you order last month? How much
do you spend every day on designer coffee, soft drinks, and fast food? How much
do you spend on dinners at nice restaurants? Take a look at what’s in your
grocery cart. How much of it is snack food or impulse buys that are both bad for
you and a waste of money? If you still need a reason to quit smoking, the
$5-plus per pack you are spending ought to finally get you to give up that
habit. Is your home well insulated, or does money in the form of energy fly out
the window? Do you turn out the lights when you leave a room? How much do you
waste each year on late fees for credit cards or overdue videos? How necessary
is each short trip you take in the car? Can you combine trips, or make small,
local errands on foot or on your bike, (which saves money and burns
calories)?
Make the effort to evaluate everything you do.
You’ll be amazed by the amount of money you can save.
Craig Nathanson, The Vocational Coach, is the author of “P Is For Perfect: Your Perfect Vocational Day,” by Book Coach Press. He publishes the free monthly e-zine, “Vocational Passion in Mid-life.” Craig believes the world works a little better when we do the work we love. He helps those in mid-life carry this out. Visit his online community at http://www.thevocationalcoach.com where you can sign up for his next Tele-class coming up January, 26th.
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