I’m thrilled to post my interview with sensible, smart, and super-savvy Laura Vanderkam about her newest book, All The Money In The World: What the Happiest People Know About Getting and Spending (Portfolio | Penguin; March 1, 2012). As she says in her own words, Laura “questions the status quo and helps her readers rediscover their true passions and beliefs in pursuit of more meaningful lives.” She is on USA Today’s Board of Contributors, and writes thought-provoking articles for CBS MoneyWatch, The Wall Street Journal and others. All the Money in the World motivates us to rethink our financial resources to begin the best chapter of our lives. Before my interview with Laura, here’s my introduction:
Suppose you had a fairy godmother who granted you enough money in the world for three wishes: getting everything you wanted, spending on everything you wanted, and sharing everything you wanted. What would your three wishes be?
Well, that’s what I got to answer for myself while reading All The Money In The World. Laura guided me like my own personal fairy godmother, helping me to look at my piggy bank with a fresh, new perspective.
I realized that we often spend our time (the subject of her first fascinating book, 168 Hours) thinking, “If only I had enough money to ______ (fill in the blank).” The reality is that if we juggle our financial resources in a more effective way, then we really can do the things we dream of doing in our lives. It doesn’t take a magical fairy godmother to live our best chapter with the money we have – it just takes imagination.
Laura’s goal is to examine what she calls “the intersection between money and happiness.” She offers practical suggestions for how to use our money to “foster experiences or create space in our lives for the things that really matter.”
As an example, Laura shares her decision to go to Morocco for vacation with her husband — but fly on a cheaper flight. Why, you might ask? It wasn’t only a matter of being frugal and saving money. Looking at her money as her private resource, she chose to allocate the dollars she saved on her airline ticket to donate to a library in an impoverished region of Morocco where 70 percent of the men and 90 percent of the women are illiterate. She said that visualizing Moroccan kids at computers in the very library she helped build would give her more enjoyment than giving the cash to an airline. This idea is inspiring: if we prioritize how we spend our money, then we can spread happiness – not only for ourselves but for others. And not just one time but on a continual basis.
What I particularly liked in All The Money In The World were some of the “How To Buy Happiness” questions that Laura poses. Here are some examples that I found challenging:
“If you had all the money in the world – not literally, but all you wanted – how would you change your life?”
“How would you improve or eliminate your pet peeves? How would you reach your personal aspirations? And then, the pivotal question: Could you make progress on any of these goals with less than all the money in the world?”
Instead of staying in dream-mode – or in what I call “Oy Vey” complaining mode – Laura’s questions encouraged me to move toward accomplishing my goals. As I’ve shared in “Ten Ways to Makes this your Best Chapter,” we need to shift our focus from the problem to the solution. Her book has helped me revise my financial outlook, reminding me once again, that it’s all in our attitude. Our outlook determines our sense of abundance.
Diana: Laura, I love your idea that if there’s an activity we like doing but we don’t think we can afford it, we can brain-storm and come up with a cheaper way to do it. I call that focusing on the solution — not the problem. Is there something you’ve done recently that you didn’t think you’d be able to afford?
I’m very lucky financially at this point in my life, but years ago, when I was first out in the “real world” I had this dream of being a writer living in New York City. Unfortunately, jobs with the title “writer” based in New York were few and far between. But I decided to just move and take it as I went. I shared an apartment with a friend and started writing for different places and soon got enough gigs to support myself in decent style. I didn’t think one could afford to be a writer in a big city without a day job, but it turns out if you keep your expenses low and work hard, you can. And New York was, in fact, an amazing place to be a young writer!
Diana: You spoke about going from a cutting coupons mentality to looking at the broad picture about money. In other words, going from a scarcity mentality to a sense of abundance. As an example, you buy Ziploc bags instead of the generic brand. (For instance, I splurge on good coffee at home each morning instead of waiting for a rare visit to a good coffee shop.) What else do you do differently with your money to enjoy your life each day?
I try to meet people for lunch more often. Eating out is obviously more expensive than eating in, and it involves more time than just eating at my desk (and time is a big expense too, even if we don’t always think of it that way). But I think the happiness gained by nurturing relationships far outweighs the cost.
Diana: You mentioned that many of our attitudes about money come from our parents or messages of society all around us. All too often we pay attention to people who live rent-free in our heads. How did you discover new ways of viewing money and how did you validate them for yourself?
My inner cheapskate is often in my head. I’ll be making a reservation at a certain hotel for a conference and yet I’ll not want to pay the extra $30 for a room with extra space and a view — even though the point of a conference is networking, and having a suite is a great way to host an impromptu party. I’ll pass by the strawberries in a grocery store when they’re $3/carton because I like to pay $2/carton — even though I probably have $50 in spare change scattered around the house. Enough to buy a lot of pricey strawberries! I’m learning to step back and realize that, as long as my savings goals are on target, money is there to be used. If spending a little more can make me or my loved ones happy, or has some other payoff, it’s OK.
But that’s my particular issue. I know some people struggle with money decisions for other reasons — perhaps they grew up impoverished and have done well and feel they need to spend big to show they’re successful. Or people think it’s OK to spend on their kids but not themselves; they’ll happily fund a child’s piano lessons but not a night class for themselves. It’s important to examine our decisions and our first impulses, and to ask if we’d advise another person to make that choice.
Diana: After reading your book, I was inspired to spontaneously leave money for a woman cleaning the bathroom at the airport. (I left it on her cleaning cart without her knowing it.) I felt richer even though I was $10 poorer. Can you explain the paradox that the more money we give away, the more money we feel we have?
Money is a tool. We can use it to build the lives we want and a world we’d like to live in. The problem is that most of us don’t view money this way as we’re writing a check for the mortgage or swiping our credit card in the grocery store! When you give money away, on the other hand, you really do see it as a tool to change something. That’s a powerful feeling. Plus, humans are social creatures. Spending money on other people nurtures our connection to them, and to society, and strong social ties are correlated with happiness.
Readers: I hope you find this book as helpful as I did. Share some of your answers to these questions and I’ll post them in a future blog!