We first worked with Joe Dominguez and Vicki Robin when they and other members of what is now the New Road Map Foundation rolled up to our old Sequim office in their UV (ultimate vehicle) to help edit IC #10, Summer 1985, on "Friends and Lovers."
At that time they already had spent more than a decade living their lives of frugal financial independence and service. Since then they’ve kept expanding their efforts to help others learn how to achieve such financial independence, first with a seminar series and then a tape course.
Last year, their book, Your Money or Your Life, hit the national best-seller lists and is now out in paperback. This guide to transforming your relationship with money and achieving financial independence is nothing like your typical how-to-get-rich-quick scheme; it focuses on empowerment, frugality, and sustainability, and it’s an important contribution to the tool kit of intentional living.
The success of the book has launched Vicki and Joe onto the talk show circuits and into popular magazines. They’ve appeared on the Oprah Winfrey show, in People Magazine, and spoken in numerous forums nationwide.
Robert: You just finished yet another book tour. What kind of response did you find during your talk shows and book signings?
Joe: I think the most stunning thing is that frugality has penetrated mainstream culture. Last year, I’d say 10 or 20 percent of the callers on the talk shows were saying, "Oh, you can’t do that!" This year there was none of that; all the calls were favorable. People were saying, "I’ve been doing this!" "This is great stuff!"
Vicki: The sense we are making of it is twofold. One is that frugality is a welcome idea to people who have awakened to the failure of the old social contract: "If I sell out to the company, the company will take care of me." That contract has frayed beyond the point of repair, and people are realizing that they are back on their own resources. They’re waking up from the bash of the ’80s, sobered and wanting other tools.
My sense is that there is also a very large contingent of people who have been living frugally all along, but in the closet because it was so out of fashion. They’ve been having potlucks, buying used, and making do and doing without, but they got no press during the "boom years." We are legitimizing choices being made by what I’d guess is a fairly sizable percentage of the population.
Joe: It’s almost like we’ve made the world safe for frugality.
Vicki: And the other evidence is the wildfire here in the Seattle area in the growth of voluntary simplicity study circles. It’s a movement that just won’t quit. Now there is a Voluntary Simplicity Association with a monthly lecture series. And nationwide, there are 40-odd newsletters on how to live well on less – the Tightwad Gazette (see Resource Guide, page 59) being the granddaddy. Three or four years ago, there were none that we knew of.
Robert: What has your book done to help make the world safe for frugality?
Joe: What’s bothering the country is a crisis of perception about what is enough in terms of financial sufficiency. We’ve got it imprinted that we need $50,000, $60,000, $70,000 a year just to stay afloat. People have been looking outside of themselves for the criteria of "enough." The book asks them to look within to judge what is enough and to take a tangible measure – to count up the goodies around. Just by applying the nine accounting steps in the book, they discover that the myth that "I need $30,000 a year to survive" is nonsense! They find that $15,000 a year is more than enough.
Vicki: Realizing that gives people a sense of a weight lifting off their shoulders, a sudden clearing.
Robert: There are at least two directions that people could take as a result of reading your book. They could develop a more frugal life, but a life that continues to be relatively normal in terms of work patterns. Or, they could use frugality to become financially independent, to move into service, and to restructure their lives. What kind of response have you been getting from people who have either done or are working on that more profound restructuring?
Joe: More people than I would have thought have seen the link: that financial independence for its own end has no real purpose. So what? So you retire earlier with more toys? It doesn’t have a raison d’être by itself.
A surprising number of people have seen that the program we outline in the book means, "Wow, I could retire and do what I have really come on Earth to do, by the age of 50, instead of 65." This changes how they see their work life, bringing them much closer to the sannyasin model of retiring in order to serve God, after having served mammon.
Vicki: In the book, you’ll notice that we defined financial independence (FI) as having stages. The first stage is just getting your mind clear; the next stage is getting out of debt. There are people who, by the act of getting out of debt, free themselves to do their service work.
There is a story in the book about a woman who spent three years working her way out of debt; then she sublet her condo, rented out her car, and went to Kenya with her church group to help start a dental clinic.
Joe: We got a letter from a Latina woman who had been working for the military in Panama as a secretary. She had been frugal all her life because she grew up that way. She had been stashing her money away, not quite knowing what she wanted to do with her life. She read the book, realized she could be financially independent, and within weeks had signed up to do volunteer work with kids in Ecuador. We’ve been getting a lot of letters with stories like that.
Robert: I’d like to hear some more of those stories.
Vicki: Here’s a letter from a family that is restructuring their finances. They do home schooling and travel around in an old motor home. They’re paying off their house at an accelerated pace with only 22 monthly payments left.
"With the house paid off, our expenses will drop and hopefully Dad can start working less and being home more," the writer says.
"But most important to me, with our priorities more clear, our life has become more free of that dizzy busy-ness and vastly more rich in the things that truly matter: family, friends, community; art and music; physical, emotional, and spiritual well-being."
Vicki: A friend who visited us over Thanksgiving is now realizing that with just a few changes in the structure of his finances, he could be FI in months, not years. He says "Now I can have a creative idea and know that I can work on it!" And he says, "How much creativity have I squelched because I knew I didn’t have the time to do anything about it."
You know, even the flow of ideas gets dammed up when you know that your life has to revolve around your job.
Here’s another letter that’s great. This woman said her family hasn’t reached FI yet, but following the program has already changed their lives.
She reduced her work hours from five days a week as an assistant vice-president at a commercial bank to four days a week; the fifth day she volunteers for a non-profit foundation. She says that on that fifth day, she’s really working for a living.
Robert: The other four are working for a dying.
Vicki: Yes. She says, "I feel so blessed. The salary I ‘sacrifice’ to be able to do this seems very unimportant by comparison. The salary enslaved me; the chance to give a gift of myself freely is a joyous freedom."
So people are feeling that joy of having something to give and giving it freely.
Robert: Clearly there has been a big interest, with your book on the best seller list, and letters and calls coming in. Are there other indications that point to a growing interest in frugality?
Joe: Yes. A lot of columnists have come out of the closet with articles against overconsumption. There’s a snowballing effect. There has been a huge upsurge just in the past year in articles related to frugality in papers like The New York Times, The Washington Post, The Wall Street Journal, and the local papers.
Vicki: Just a month or two ago, Jane Bryant Quinn, a mainstream newspaper financial counselor, wrote an article suggesting that it’s time to redefine success. People are being downsized out of their jobs and middle managers are realizing that they may never make it up to the top, so people are having to change their image of success away from the workplace and into success in other realms: in their volunteer work, communities, and families.
Joe: Yesterday, a columnist for the Boston Globe came out with a superb article about how Americans gobble up way too much stuff. Many of the articles we’ve been seeing are directly linked to the book, but a lot of them are not. There’s been a mushroom effect; once one columnist writes about frugality, others feel they have permission to speak up.
Vicki: Advertisers are now trying to sell products by labeling them as frugal. I saw a television ad for an economy car recently that showed a couple of really good-looking ’90s-type women standing on the steps of some building scoping out a lot of well-dressed men walking by. They were making these comments about the ones getting into fancy cars: "This guy must have a really fragile ego if he needs a car like that, you know, a big car, or fancy car, or sports car, in order to prove himself."
Then a guy comes out and gets into the economy car, and one woman says, "Now that guy is interesting, because he obviously is ‘together’ if he can drive a simple car."
So advertisers are seeing that you can sell products as being simpler, more economical, more frugal.
Joe: There is now a chain of stores in southern California called "McFrugals."
Robert: One of the politically sensitive things around focusing on overconsumption is that if people are consuming less, there is less demand, and that could mean fewer jobs. How are you linking the issue of overconsumption to fresh ways to look at unemployment?
Joe: The economists are doing that for us. They’ve been saying, listen, consumption isn’t what’s going to save the American economy, it’s investment capital that’s going to save the American economy. I didn’t think I was going to live long enough to see these big name economists coming out with this on the front page of The Wall Street Journal!
Savings provide investment capital for infrastructure repair and everything from schools to roads. If we have to go outside the country for capital, as we did in the ’80s, it’s very, very costly. Costly means loss of jobs, by definition. So this is the argument that the economists are making for us.
Robert: Right. But the longer term consequence of increasing that industrial productivity and getting that infrastructure in better shape is that, afterwards, you are left with less work that needs to be done.
Joe: By then you will have fewer people working to age 65. You’ll have more people going on half-time, as the letters we’ve been receiving show.
Robert: It seems to me that that’s part of the real strength of the way that you have been approaching the issue of overconsumption.
Vicki: Yes. It’s going to be kind of a gentling down. There will be people who discover they don’t need their jobs anymore; they’ll be freed up for full-time volunteer work, and their jobs can be released for other people who do need them.
There also will be people who discover that by consuming less they can get by on half the amount of money that they thought they needed and can therefore work part-time. So there will be a decreased demand for products and services at the same time that there is a decreased demand for jobs.
Joe: Economists also point out that it’s not our productive capacity that’s the problem; it’s the fact that the product is greatly overpriced and is not available in the Third World. Better water pumps would definitely improve the quality of life in a lot of the Third World, for example.
I’m not suggesting that we should flood the world with all our useless stuff, but there is a certain amount of the output of our factories that is of use.
So, instead of factories shutting down or significantly reducing their output, I think there’s going to be a redistribution and a re-prioritizing of what those factories produce as we move towards both more appropriate exports and more appropriate domestic consumption.
Hopefully, as the mindset of this country shifts and we stop modeling "consume the world," we will begin to model frugality in its true meaning, which is better use of resources and taking full pleasure in what we have.
Joe Dominguez and Vicki Robin can be reached at the New Road Map Foundation, PO Box 15981, Seattle, WA 98115.
What is your real hourly wage? How much are you trading your Life Energy for?
Life energy is the approximate hours we have to live. A life of 77 years translates to 674,520 hours of life energy. Money can be seen as something we choose to trade our life energy for.
Money = Life Energy.
It’s easy to figure what an hour of my time is worth. If I work 40 hours/week at $400/week, I’m trading an hour of my life energy for $10. However, this does not include all the life energy associated with doing the job.
For instance, getting to and from work incurs an expenditure of time and money. Commuting time of 1 hour/day equals 5 hours/week. The cost of car maintenance, parking, tolls, gas equals $50/week. Making that adjustment:
Time Money Value Job 40 hours $400 $10/hour Transportation +5 hours -$50 Result 45 hours $350 $7.70/hour
Instead of $10/hour, my real wage is down to $7.70./hour.
Use this technique to make adjustments for costuming, grooming, laundry & dry cleaning expenses, meals (including the fast food dinners because you are too tired to cook), daily decompression time, job-related illness, career-enhancement expenses, hired help at home to do jobs you lack the time to do, child care and tutors for children, the hours of talking to spouse or therapist about job frustrations, needed vacations, etc.
Now, you can figure how much money you’re trading your life energy for.
Information from: Your Money or Your Life, by Joe Dominguez and Vicki Robin, Viking Penguin, New York, NY, 1992. 350 pp., $20 HB, $11 PB.