Let's revisit the first part of a post a few months ago: Fill in the Blank: I Don't Want to Spend Money On..

When you think about all the things you hate paying for, it's easy to fall into the negativity trap. So many of those things seem well out of our control, don't they? Car insurance just isn't one of those things you can up and stop paying for. Neither is that mortgage payment.

So I want to be very clear about why this is a valuable way to spend some of your time, because listen: this isn't an "I'll be happy when..." exercise. Moping through your life telling yourself that all you need is a paid off house, or kids who finally pay their own way, or X number of dollars in your savings account to be happy is a loser's game.

I have learned the secret to a successful financial plan, and it's this: intentional contentment.

First: contentment isn't a passive, let's-fold-our-hands-in-our-laps-and-act-happy-about-everything-that-happens-to-us state of mindlessness. It's an active attitude of "we can do hard things because hard things are worth doing". It's difficult to cultivate and maintain in the face of life's many disappointments, but although it sometimes resembles giving up and submitting to the status quo (from the outside, at least), it's a conscious, mindful decision that most people have to make every single day in the face of (sometimes) incredibly hard realities.

There's an aura of perceived failure around someone who isn't in a position to make any big changes in a life that looks pretty unfulfilling from the outside, isn't there? A lot of the rhetoric around poverty seems inspired by the "you should be doing something to make your life better" success mindset we as a society have idolized for more than a century.

But contentment - as unfashionable as it sounds - is actually the only consistent key to a successful financial plan. Because the truth is, a financial plan isn't really a plan at all, although it shares many of the same characteristics like action items, measurable goals, and policy statements. You and I both know that your formal financial plan could expire the day after you read it if you lose your job or your house burns down or one of your kids gets really sick. This year's savings might fall by the wayside. You might end up further away from your debt-free date than you started.

Contentment is the opposite of fear and greed and restlessness. It's the quality that allows you to look around your life, identify the things you're grateful for, those things from which you can extract the most joy at the least cost (and we're not just talking money), and consciously choose to orient your life around doing or having more of those things.

If how you spend your money every day is your most important financial characteristic, shouldn't you be content with it? If you're not content, why not? What can you do to change your circumstances or - if you can't, or if change will be a long time coming - what can you do to change your attitude about your circumstances?

Combing through your expenses and identifying the ones you hate paying for is not the opposite of cultivating contentment. It's the first step in a series of decisions that smart people make. Getting very, very clear about you don't like about your current situation, defining the direction you'd like to travel in to get closer to the things you do like, and then creating systems to help you get there? That's real financial planning. The rest of it is just math and details.

A strong set of contentment muscles are what gives you the energy to be flexible when life happens. Someone practiced in the art of finding happiness and fulfillment wherever she happens to find herself is already mostly prepared to adjust her spending downward in the face of post-retirement market declines, or defer the much-desired house because she's just not earning enough as soon as she thought she would to make it a wise purchase.

Listen, contentment in your direction is what gets you to your goal. A goal is a real, measurable thing: start my own profitable business by the age of 34. Pay off my mortgage by the age of 48. Save enough to live happily off of my investments and only work if I want to by the age of 57. Those are goals. They can move.

A direction, however, is a total orientation of your life towards reaching those goals. It's what you do the day after you read your plan, and the systems you put in place to get and keep you moving towards your goals, whatever those may be: planning meals within a pre-determined weekly food allowance so you can save for a house, for example, or learning how to code in your spare time so you can increase your salary or start a business, or taking public transit so you save your car expenses towards financial independence instead.

The daily practices of a life with direction can either be onerous, and chafe so much that you give up or grumble your way through a miserable life, or you can settle into them with an attitude of contentment and get happy on the way to your goals, not just when you eventually reach them.Your choice.

At first glance, it sounds like an incredibly stupid exercise, I grant you.

Um, I don't want to spend money on insurance, on my mortgage payment, on those never-ending, teeny-tiny little school activity requests that dribble home every other day, on fixing my car (again), on buying new shoes for kids whose feet won't.stop.growing, or on the property tax shortfall notice I got last week. And that's just for starters.

Realistically, at least for most of us - a lot of the things we don't want to spend money on won't go away just because we decide we don't want to pay for them anymore. Ten months out of the year, my kids need shoes, and - last time I checked, anyway - two-, four-, and six-year olds aren't allowed to get jobs.

The point of digging down into the things you want to say "no" (or even "hell, no") to - like loan payments or groceries that you waste or tv you don't watch - isn't so you can dwell on how much you hate paying for those things. That's just the beginning.

Getting really, really clear about the things you actively dislike or don't care enough to bother spending money on is only the first step. The next step is heady, fulfilling stuff: getting really, really clear on those things you truly DO want to spend money on.

Start working on that list of things you don't want to spend money on. Next post will be all about the YES.

I've had a chance to do some work with Heather Thorkelson lately. She's a small business strategist (among so many other things) working with entrepreneurs to align their work with their dream of work, whatever (or wherever) that might be. I admire her an awful lot, and she wrote something a few weeks ago about this very topic of saying no so we can say yes that she said I could share with you:

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Beyond the “find my passion” stage: how to find direction in an unconventional market

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I’m going to be straight up with you – I think everyone’s gotten a little carried away with this whole “find my passion” business. First off, it’s a bloody tall order that leaves most chasing their tails, reading every self-help “find yourself” book out there for years and still not coming to a conclusion.I’ve got a better idea. Ideas to be exact. It’s an approach that worked for me, and many of my clients. Heck I even heard Oprah talking about Step One the other day so I must be on to something!

Step One: Get really clear on what you DON’T want to do.

You’d be surprised at how powerful of an exercise this is. My answers when I asked myself this back in 2010 included things like:

1) I don’t want to fill out useless spreadsheets for other people to prove that I was ‘working’ but that no one would ever actually read. (Hi, can I please have those three hours of my life back?)

2) I don’t ever want to work with people I don’t like.

3) I don’t want to ever have to ask for permission for my measly three weeks off a year where I can go and really LIVE.

4) I don’t want to do work that has no meaning for me personally. And if it does lose it’s meaning, I want the built-in flexibility to shift gears and move toward greater service and fulfillment.Savvy? Pause here and go answer that question yourself.

Step Two: Figure out what makes you happy.

For real. Not the fleeting stuff like shoe shopping.What gives you a profound sense of happiness and brings you right into the NOW every time you experience it? Helping people? Being in your ‘zone of genius’? Public speaking?

Also ask yourself what kind of humans light you up? (HINT: You should be working with them!)

I know this is a lot harder than it sounds. My clients often struggle with this, but it’s some of the most important self-awareness work you’ll ever do. So sit down with a pen and paper, activate the brain cells, and get scribbling, love. If you’re really having trouble, think about what you’d want people to say about you at a speech in your honour ten years from now.

Step Three: Time is your most valuable asset. How do you want to spend it?

This may seem too pie-in-the-sky for many of you, but honestly, when I started building my workday around how I truly wanted to spend my time, my happiness increased ten-fold.

Be honest here. How do you like to spend your time? In nature? On a surfboard? Snuggling with your dog? Making out with your lover? Traveling on trains? You need to build your livelihood in a way that accommodates for that. It may not be entirely possible in the beginning, but when you know how you want to spend your time you have something tangible to work towards.

Forget that new-agey “passion” hoo-ha. The reality is you probably have many. And therefore many viable options. Figure out how you want to live and the options will become clearer.

Yours truly,

The pharmaceutical rep who became a life coach who then became a web designer who then because a business strategist/polar expedition guide in the process of figuring out a formula that would work for me. (PS: Every step was awesome, every step brought me income, and every step helped me figure out what I truly wanted in this stage of my life. The road may not be straight, but it promises to be interesting.)

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You can find Heather at her website Republic of Freedom, on Twitter, or on Google+. She's currently working on The Leap Guide: Everything you need to know about building the livelihood of your dreams through freelancing.   

Financial planning is misnamed. It really should be called Figuring Out How Much What You Want Out Of Life Will Cost And How to Pay For It By Finding The Happy Medium Between Doing What You Have To Do And Doing What You Want To Do.

I imagine this will never take on.

Because sensible.

Don’t get me wrong: when I say financial planning, I’m not adding “by working with a professional” under my breath. The most important, most necessary part is the navel-gazing that only you can do. No amount of tax efficient saving or avoided debt can compensate you for an unfulfilling life, and no financial planner is doing anything that you can’t learn how to do for yourself. Anyone that tells you different is selling something (and it’s probably mutual funds).

In fact, I’d go so far as to say that it’s entirely possible to live a happy and fulfilled life even if you pay interest on a credit card, underperform the market because of poor decisions or high MERs, or buy a house in an overpriced market, or retire with less than the optimal amount of money saved up. It might be harder than it has to be, but millions of people are doing it, and it’s rare to hear “I wish I’d earned more money and spent less time with the kids” on a deathbed.

And then there’s that word. Optimal. It’s such a science-fiction villain word, and I can’t help but imagine armies of shiny metal robots, marching through your bank statements and shouting OPTIMIZE! before blasting away anything that doesn’t add to your net worth.

I like robots. I like things to be tidy, and logical, and - as much as I rail against the word - optimal. It’s part of my personality, which helps explain why I like spreadsheets so much. But life with three kids isn’t tidy, it sure as hell isn’t logical, and money has functions more important than giving me a grade for how well I’ve lived my life.

Call me unambitious, but I want to be happy for all of my life, not just when I’m 67 and retired. I don’t want to save or pay down debt so aggressively that I do whatever it takes now to get a financial A+ thirty years from now, and that means consciously balancing my spending between what we need and want now versus what we need and want in the future. Sometimes that means recognizing that there are only so many clothes a toddler can wear between laundry days, sometimes it means forgoing date night at a restaurant in favour date night in the kitchen, and sometimes it means hiring someone else to clean my house because I’m better at spreadsheets than floors.

Right about here is where those of you with easier choices to make or online reputations to uphold are reading this as if I just said that I like to travel so I’m putting an all-expenses paid trip around the world on my credit card because YOLO. 

Ridiculous.

Almost every money celebrity out there wants you to believe ardently in the concept of short-term suffering for long-term gain, but Dr. Yonni Freedhoff has it right (albeit about dieting rather than money): there’s only so much suffering someone can take (podcast).

Your job is to take a realistic look at what you want out of life and - when you can’t have it all - consciously pursue the things that make you happiest over the things that you might otherwise pursue just because they’re the default options.

Most of us want to do the best we can with what we’ve got. Some decisions are easy to make, some are easy to understand but hard to follow through on, and some are incredibly difficult - both to make and to live with. If you’ve been spending more than you make for years, it will take more than not spending to redress the imbalance, because you can’t Not Spend forever.

Here’s the crux of the issue: there is a happy medium between optimal and realistic, it’s different for everyone, and the only person who can figure it out is you. Someone like me can help clarify the issues and prioritize the trade-offs, but - especially when the trade-offs are hard - you’re the one who has to live with them.   

The point: frugality isn't a virtue, especially when you're hitting your family over the head with it. Repetitious, I know.

Are you upset by the amount of stuff that your family is going to give your kids this Christmas and resent them for their materialistic, showy ways, and their utter disregard for your frugal minimalism?

Have you gently brought up your desire for smaller Christmases or birthdays with less emphasis on stuff and they haven’t listened? Are you already pre-annoyed with them before you even see what too big, too noisy, too plastic, or too flimsy junk they fill your house up with this time?

I have some advice for you (whether you want it or not, because that’s just the way we roll around here): 

Stop it.

Yeah, you. The person with the good intentions and with the correct emphasis on people and experiences instead of things. The one with the knowledge born of scientific observations in the field that the kids are going to get gift fatigue after present five and either have to be prompted (repeatedly) to move on to the next present or start ripping paper indiscriminately and moving on to the next one without even looking at whatever the previous box contained. 

I'm talking to the grudging receivers here, not the enthusiastic, if misguided, givers: stop it.

What you’re trying to do for your kids, for your house, your planet, your sanity, and even for the wallets of the gift givers is admirable, but if your example and (possibly) polite request aren’t enough to change the behaviour of the people who love you and/or love your kids, and you continue to make it an ongoing issue, you’re the problem.

You’re making stuff (less of) and money (saved) more important than people. Merry Christmas.   

The point: being frugal just for the sake of being frugal isn't being virtuous. It's being cheap.

Let's pretend this is the first time you've been on the internet, and you feel like you need personal finance advice (one of these scenarios is probably easier to imagine than the other.)

What does the internet tell you to do? Invariably, overwhelmingly, (annoyingly), the internet tells you to be frugal.

Ask any search engine "how do I save money on...", and you will be bombarded with tips like always making your own coffee at home, never opening the oven door to check on your food, always line drying your laundry, and keeping your thermostat three degrees lower in the winter.

None of these activities are inherently bad, in the same way that "being frugal" isn't bad. But none of these activities are inherently good. Self-control is a virtue. Frugality is a tool. Don't get them confused. Practicing the former is something to admire; practicing the latter is virtuous only if it furthers some other (meaningful) purpose.

The opposite of frugality isn't convenience; it's wastefulness. But - and here's the tricky part - the cult of frugality has conflated the two, and leaves average North Americans with the overwhelming impression that the way to build wealth is to stop buying coffee on the way to work, and that the person who hangs her laundry out to dry is more virtuous than the person who uses a dryer.

Practicing rational frugality lets you consciously transfer money from a less important goal to a more important one. Making your coffee at home instead of buying it on the way to work lets you transfer the money otherwise spent on a daily Starbucks cappucino to something else, like another twenty dollars of groceries. But only if you value the groceries more than the coffee.

Although the internet would like you to believe that frugality is the only answer if you have too much debt, can't afford to do the things you want to do, or are chained to a job that you hate, it's not.

Not even close.

If you're denying yourself conveniences, pleasures, and even necessities without reallocating the savings towards activities that will either bring in more money or create a cheaper, more enjoyable lifestyle, then you're denying yourself for no reason.

Frugality without a goal in mind isn't virtuous, it's inane.