28 April 2019
On the rare occasion I find myself in a pub later in the evening a predictable pattern of behaviour arises in some of the clientele. A regular, on first name basis with all the staff, assesses the coins in his pockets to see if they will cover another beer. There is no consideration of prior consumption or future expenses. In effect, the money is deciding to spend itself. Money is just an abstract concept, it really shouldn’t be trusted with such decisions. The only way this situation could be made even worse is with the addition of a credit card.
Time is often treated the way an alcoholic views money—time makes the decisions. We all have a hard limit on our time; those 24 hours in a day. Sleep, exercise and healthy eating all take time and effort. As with a credit card, we can borrow from the time we spend on these activities, we can set an earlier alarm or stay late in the office and order take-away for dinner, but we pay for it with our health in the future. We go into time debt.
Financial decisions should be based on needs and value. Getting to work is a need and a bus is a good value solution. In practice, many decisions are based on wants and funding. Hence there is a market for luxury cars. Debt increases what one can afford now and wants rise accordingly.
We can make decisions on how we spend our time based not on how much we have, but on needs and value. A couple of decades ago the concept of social media did not exist. Collectively, we decided to make time for this innovation. Initially it appeared to allow us to connect with our friends more efficiently. In practice, it keeps us connected with friends we would have naturally drifted apart from. Clearly, we have the time for social media, but should we? Does it represent good value for the time cost? If we spend our time based on how much time we have then we will do many things. If we go into time debt we will be even busier. So busy we can’t find time to meet up with our close friends who live around the corner. So busy that we must multi-task while driving a car. And yet we have time to scroll through our Facebook feed and see that it’s someone’s birthday and we don’t know who they are.
A credit card allows us to live beyond our means. A savings account forces us to spend only what we earn, but discipline makes those limits unnecessary. Discipline is the ability to admire your neighbour’s new car without desiring it for yourself. Once cultivated, discipline can be applied anywhere. It can be used to say no to things that take up your time but give little back in return.