“You all laugh at me because I’m different, I laugh at you because you’re all the same.” — John Davis
Financial advice abounds everywhere we look. It is not difficult to discover. And yet, the statistics paint an ugly picture that it may not be working so well. The average American family still holds $6,700 in credit card debt and 76% live paycheck-to-paycheck (just to name a few).
Unfortunately, most people think more money is the answer. And while there may be some truth to this solution, most of us would readily admit that our most basic needs (food, shelter, and clothing) are financially covered. It appears then that most of our financial troubles are not based in need, but in cultural expectations—that because we live in a society based almost entirely on consumption and the promotion of it, we have too subtly bought into the lies and built our lives upon them far more than we realize.
Perhaps, then, the pathway to financial freedom requires a bolder, more countercultural approach. One that intentionally begins to question the messages we believe and looks elsewhere for answers. To that end, consider this list of 8 Bold, Countercultural Decisions to Find Financial Freedom.
Each of them questions culturally-accepted norms. Before you begin, know that we believe and practice each item on this list. We have found wonderful freedom in them. And whenever appropriate, I’ll share the story of how we arrived at each decision.
Eight Countercultural Decisions to Find Financial Freedom
1. Purchase based on necessity, not possibility.
Especially in large purchases, consider necessity over possibility. When we bought our first home, we went to the local bank for pre-approval. They approved us for a loan up to $135,000. And… we immediately started looking at houses up to $135,000. We based our search entirely on possibility. There was no consideration given to our actual needs.
When we found a new, higher-paying job, we were pre-approved for a $300,000 loan and… we immediately started looking for homes in that range. Our purchase became a heavy burden in payments, maintenance, and upkeep. During that season of life, we discovered minimalism. Our desire for physical possessions changed dramatically. As a result, when we moved into a new home two years ago, we determined our ideal house based on necessity, not opportunity.
Our payments are smaller. Our upkeep is easier. Our lives are more freed to pursue other passions. We have never regretted the decision. And I actively encourage others at every opportunity to purchase based on need, not possibility.
2. Never carry a car payment.
One financial decision that has had a profound impact on our financial well-being was our wise decision to always pay cash for our vehicles. Subsequently, we have never had a car payment—ever.
I bought my first car from my parents with money I had earned working at a local carwash. And all future car purchases were based on the most reliable car (or mini-van) we could afford with cash already in the bank.
We have never owned a brand-new car or one that turned heads in traffic, but we’ve also never felt stress or regret over a car purchase. And if you ask me, that’s a pretty fair trade.
3. In dual-income households, don’t spend the lesser income.
One of the most valuable pieces of financial advice we ever received came early in our marriage when both my wife and I were working. My boss encouraged us to live entirely on my income and save every penny my wife earned. We did just that. Her earnings became our first down payment on a home.
But more importantly, it prevented lifestyle creep from setting in. And when our first child was born, becoming a one-income family was an easy transition.
4. Avoid alcohol.
Countercultural? For sure. Financially-beneficial? Absolutely. Even-possible? Definitely.
I inherited the lifestyle from my grandparents. Both sets refused the consumption of alcohol for different reasons (some personal, some religious). But regardless of their reasoning, the pattern continued with my parents, myself, and my siblings.
While financial concerns were never a chief motivator, the decision has resulted in significant, personal financial benefits for us. Americans spend $50 billion each year on alcohol—despite the fact that 34% of Americans don’t drink. This is a significant expense for many families. Removing it completely returns a significant amount of discretionary income.
And adding other unhealthy behaviors to this decision results in even greater returns.
5. Never retire.
I learned it from my grandfather. He worked full-time until 7 days before his funeral at the age of 99.5 years old. I learned from him the value of work and the importance of seeing work as contribution. This view of work changes everything.
Work is no longer something to avoid or retire out of as soon as possible. Instead, work becomes joy. Now, just to be clear, it is still wise to plan financially for the future and old age.
The truth remains that our physical bodies break down and some types of work become difficult (or impossible in some cases) to continue. I would never argue against the importance of transition in life or saving for it. But getting set in a mindset that only looks forward to retirement without the possibility of embracing work during it is one that should be adjusted. And ought to impact our financial decisions today.
6. Pay with cash.
Every study reports the same finding: We spend more when we pay with plastic than when we pay with cash. And one of the most commonly offered pieces of advice for those trying to stick within a budget is to pay with cash rather than credit. Yet the strategy remains rarely used.
While we have only used the strategy off and on over the years, we have found great personal benefit each time. Not only does it help us stay within a budget, but it also helps us keep a tighter record of where the money is going. And greater intentionality in tracking expenses is advantageous regardless of your income level.
7. Give away (at least) 10%.
There are numerous religious traditions that teach the importance of giving away 10% of income. Personally, it is a financial philosophy that we have put into practice during times of both little and plenty.
Certainly, the gifts benefit the receiver. But more than that, the gifts benefit the giver. Generosity is an important step towards contentment. It brings the fulfillment and joy and meaning to life that is often sought in financial purchases and personal gain. It reminds us of how much we already have and how much we have to offer others.
And while it seems entirely counter-intuitive, one of the most important steps we have taken to financial freedom is to embrace the practice of giving some away.
8. Put the spender in charge of family finances.
While this may or may not suit your family’s unique dynamics, it has been entirely helpful for mine. I hold a college degree in Banking and Finance and Accounting was one of my favorite classes in high school (seriously, thanks Mr. Fink). I understand budgets, spreadsheets, assets, and liabilities.
But my wife is a bigger spender than me. And one of the most helpful actions we took as a family was to put her in charge of the finances rather than me.
Because our bank account levels were always small, she became far more careful with her purchases… and worked hard to keep me in line too.
Again, I don’t offer this list as an exact prescription for each reader. Each and every family situation is entirely unique. What has worked for us may not work for you. But if financial freedom has eluded you, earning more money may not be the answer. It may require a bolder, more countercultural decision to getting out of debt..
Al says
Pay with cash – totally agree! Before we moved to Panama (where everyone pays cash) we put everything on our credit card and would pay it off at the end of the month. Why? Points. We amassed enough points to fly to Miami, San Fran, rent cars, attend events. But the truth is we weren’t completely in tune with how much money we had available to us until we started paying with CASH again!
ren says
Thankful every day that I’m on same page with my partner on finances. Watching othersspend into oblivion, doesn’t matter what u make if u r spending all if it and then much more.
Sorry. Your name brand labels and fancy vehicles don’t make me jealous. I pity person who thinks material possessions will give u happiness, its fleeting at best. The people who truly love u don’t care if u have big fancy car or wearing the new hot brand of jeans.
E says
It is better to live off the smaller income and use the larger to pay down debt/save.
Working forever is not a reasonable goal. Like some other posters, I want to hike, cook, travel, garden, read, and make memories! To make the most of my life, I will have to get out of my office job. Then we can just live on the smaller income like we do now.
Andy G says
I can understand the not fully retiring as a way to keeping you mentally and physically fit,… plus there’s no guarantee your pension will still be there or at least sufficient by the time you come around to collect it.
However 40 hours a week at the age of 92,.. either the guy must have a super interesting job or he has absolutely no life and/or is ingrained with the work ’til you drop badge of honor mentality.
I would have assumed that a minimalist would strive to work part time rather than full(unless their job is absolutely amazing) time already at a fairly early age,.. you know the whole work life balance thing that’s supposedly accrued through frugal living,… …kind of defeats the purpose if you’re working so long you don’t have any free time.
kenneth says
Paid off numerous credit cards over the last few years with only 2 left to go yay!..We are on a budget & tracking monthly expenses and using the envelope system to help us keep on track. We have a 1000.00 emergency fund we use to help us cover those unexpected expenses its saved us plenty of times! There is less worry and stress over money and where it’s going now than previously.
Hirhsikesh K says
https://www.payoff.com/life/community/payoff-personality-hrishi-k/
ren says
I’m back on track, spending less, came into a little cash, paying off two bills and what is left will be Xmas shopping, cutting back more with older kids and parents and getting them all practical consumable gifts from local shops and making homemade goodies. Not using credit card at all this holiday. I need to concentrate on paying off last credit card next year.
Bill says
From my perspective as a semi-retired self-employed entrepreneur, there are a number of excellent points made.
I’ve only bought 1 new car in my life (a 69 BMW 2002 which is currently worth more than I paid for it). Govt auctions have supplied almost every vehicle I’ve owned.
Very little is said about investing. I’ve never made a lot of money but was able to save by setting up a self-directed IRA. My advice from personal experience is to use the lowest fee mutual fund company available. In my case, that is Vanguard. Their philosophy results in your money working for you & not your broker. When a broker or fund invests your $10K & takes 7-10% off the top, your $9000 to $9300 has got to earn 8%-12% just to get you back to break-even. Yearly fees after that are too onerous for you to make the return Vanguard can offer.
Critter says
The biggest spender having financial control is what got us into financial trouble. My thinking was, ‘he can’t possibly continue to spend like this if he sees the impact it has on our family’. I was so very wrong.
Annette says
Thanks for some real life input. I thought this rule would be very hard for me as well and I didn’t think it was a good idea. My husband makes more money, but also spends WAY more than he makes. So, to put him in charge would allow him to see where all the money goes, right? Well, after reading your comment, I don’t think I’ll be doing that. And sorry that things didn’t work out for you. What do we do when one spouse is ultra conservative and the other is the TOTAL opposite?
Deborah Groom says
I really enjoyed the article. During a time of paper thin finances I needed to track every cent. I budgeted my fixed expenses, reducing what I could, and then making envelopes for the variables. The difficulty with using credit cards is you do not have the same boundaries as you do with cash. Each month I take out my variable money and divide it at set amounts for Christmas, birthdays, haircuts, ferry travel, travel, clothing, auto repairs etc. You have to be honest with yourself. I budget for two pedicures a year because I know I’ll do them. That is a budgeted treat. I found that I saved, on average, $600/month. I was shocked. At Christmas I know exactly how much I have to spend and budget accordingly. Now I couldn’t imagine living any other way.