What Money Buys

There seem to be as many financial You Tubers are there are dating coaches. All of them are, of course, about not spending money, or, as we Brits would say, not pissing it away. A lot of them are about saving or investing money instead of spending it, and how much better a person you will be if you save or invest instead of spend.

Right. (cracks fingers)

Money buys four different things: necessities; peace of mind; quality of life; options.

Necessities are the the things you need to make the money you need so you can get the things you need to make the money you need. And not be living in your Mom’s basement. And not looking like a homeless person. Rent, council tax, travel to work, raw food that you cook yourself, water, electricity, gas, clothes, shoes, mobile phone. (If you don’t think a mobile phone isn’t a necessity, you are a privileged white person who doesn’t work. If you did zero hours or temp work, you’d know the only way an agency gets in touch is on a mobile.) Soap, shampoo, toothpaste, nail clippers and nail file. Detergent to wash your clothes with. Razor and shaving cream. Towels. Bedsheets, duvet, pillow and pillow cases. Haircuts.

Peace of Mind is what comes when you know you can handle something going wrong. Being the guy who tears his hair out because he doesn’t have the spare cash to handle a minor upset, from a blown tyre, or water on the laptop, or missing the holiday flight home and having to buy the expensive one-way ticket - being the guy whose world falls apart at that kind of stuff is not a good look, and it’s a lousy way to feel. Anything goes wrong, and you flip off the deep end, because you may have to starve for the next week. That’s why you buy contents insurance, even if you don’t own your own place. It’s why you put money into an Oh Shit account. At today’s prices, you will start to feel comfortable with about £2,000 in the Oh Shit account.

Quality of life. This is two things: less shoddiness, inconvenience and effort, and more pleasure, health, education and personal growth. Shoes from Northampton cobblers instead of cheap things that look awful after six months; good noise-cancelling headphones to avoid the pointless sounds of commuting; my weekly minutes in the sunbed; parking at the station now and again; having a car, even though I don’t drive to work; my movie streaming and music streaming subscriptions, DVDs, CDs, books, movies and occasional live shows - entertainment is quality of life. Dental hygienist once every three-four months.

Quality of life is not indulgence. The difference is not in the act itself, but in the purpose and affordability.

One indulgence is acceptable. Mine is the gym. It’s a fancy one. They provide towels. There’s a swimming pool. The soap and shampoo is Cowshed. I rent a locker. Get there early enough in the morning and pick up a free copy of the Financial Times. I could go to a much cheaper one, but it wouldn’t be twenty yards from Piccadilly Circus. I’ll go to a chain warehouse gym when I retire.

Where I differ from the gurus is this: it’s your money, your life. You want to piss it all away and be poor for twenty years after you stop working, please by my guest. I’m not going to stop you, and I’m not going to vote for a Government that wants to bail you out either. You want to be dumb, go ahead. I have no idea how people can spend thousands on gaming laptops and games, but they have no idea how anyone could live a life as boring as mine.

Because, unless you make a pile of cash and keep it, or unless you are in the top five per cent of salary-earners in your economy, the difference between all those spending-saving strategies is in two things: first, the exact degree of genteel poverty you are going to live out the last twenty or so of your post-retirement years; second, the exact degree of insecurity, anxiety and inconvenience in which you live the forty years you’re working.