The Ultimate Decision: Your Money or Your Life

In their thought-provoking bestseller, Your Money Or Your Life, authors Joe Dominguez and Vicki Robin lay out their nine-step plan to help readers achieve "financial independence." The quest for financial independence should not be confused with becoming independently wealthy. Instead, being financially independent means "having an income sufficient for your basic needs and comforts from a source other than paid employment." Central to creating a more fulfilling life independent of paid employment is the recognition of the price we pay for the money we earn.

The Trade Off

This cost is described by the authors in terms of "life energy," meaning, the precious and limited time each of us has here on this earth. When you go to work each day, you are, in essence, trading your life energy for money. The popular pitch "buy now, pay later" takes on new meaning when you start to really assess the price of spending so much of your life energy earning money so you can buy more things. "If you spend your life energy on stuff that brings only passing fulfillment and doesn't support your values," the authors point out, "you end up with less life." 

Your Money or Your Life is based on Joe and Vicki's popular seminar "Transforming Your Relationship with Money and Achieving Financial Independence" and the authors offer themselves as living proof that the program works. In 1969 at age 31, Joe retired from his job on Wall Street "never again to accept money for any of his work." Vicki met Joe that same year and began applying his financial principles which allowed them both to serve as full-time volunteers working with various community service projects in sync with their values.

Vicki later founded the New Road Map Foundation, a non-profit charitable and educational foundation and began to lecture widely on the topic of financial independence. Like Joe, she receives no compensation for her speaking engagements. In fact, the New Road Foundation is staffed entirely by volunteers, none of whom receive any salaries, royalties, honorariums or personal expenses — including Joe and Vicki. Instead, all proceeds are donated to causes that reflect the authors' values.

The Steps to Freedom

You're probably wondering how these two pay the bills without a paycheck. The answer, they'll tell you, lies in following nine steps. To give you a general idea of how the program works, step two asks you to add up all the time and money that goes into having a job: buying work clothes, getting ready for work, commuting, hiring others to do things you have no time to do, as well as the things you do to help decompress from work like escape entertainment, vacations, dining out and so on. It can be a rude awakening to learn for example, that when you calculate the time and money required to maintain your job, high hourly earnings can easily translate to something closer to minimum wage.

Applying the first seven steps of the program for a few months puts you in a position to fairly accurately project how much time it will take before you reach what is called the "crossover point." Your crossover point is the point in time at which you can expect be financially independent. Of this time Joe and Vicki write: "Take a minute to think about what would happen if you knew that you would have to work for money for a limited, foreseeable length of time (say five years) instead of that vague limbo of working until traditional retirement... For people who are highly motivated to leave paid employment in order to follow another dream, the ‘finite period of time' is like the lure of the stables to a horse heading home after a long ride. The homing instinct takes over and you fly toward the goal."

If you've been dreaming of a way to get off the earn-more-to-buy-more treadmill so you can spend your "life energy" on the things that matter most, Your Money or Your Life may be just the wake-up call you need.

[Note: Sadly Joe Dominguez died of cancer January 11, 1997. His work lives on through the thousands who have changed their lives through his example.]