Lifestyle Conflicts: How we manage them.

Rewind to household conversations about 20 years ago. What were the family conversations then pertaining money?

Let’s us hide our money, not disclose our real income, save on taxes, save in bonds, save in PPF, buy gold, stock markets is gamblers den, it’s a place where only the lower mortals go to, people takings debts or loan were looked down upon… so on and so forth.

These days we hear; Let us save but also let us explore all the options. Let’s work very hard and then let’s celebrate. Let us make the most of what we have today. Money will flow in. Don’t worry too much about the cash, income will keep coming in, if not this job then there a many other jobs available. Spend and be merry, life is a party so live it. Money is available in plenty and larger the income larger the EMI’s it can support.

While we all know this prudence says that we take the middle of the road approach. That is where issues begin to germinate. We face a dilemma; to decide which is the better path to take? While we think we are automatically placed in one of the two camps and this tends to continue lifelong. The 2 categories are “users” and “creators”.

First let’s talk about the “Users”.

Like they say, make hay while sun shines. If one can afford it now, why not? The “users” have it all, many friends, travel, parties, adventure, cuisines. They experience much more and their life is enriched. It is situation where when you look back at life you feel you have done so much. Each day was like a story and there are so many events to add to our memory bank. Life goes on and we enjoy while the good times last.

The cashflow then falls like a bungee jump when times change, when the boom gets over, once the existing job is gone and a similar is not available. Boom times do not last for ever. For e.g. think about salaries to call centre employees, can they rise for ever? As long as those hefty bonuses keep coming in you don’t mind working 16 hours in a day. But somewhere that routine will stop. Mid career crises and rediscovering the direction you want to take forward will put brakes before one is ready. We feel it will not happen to us but this will happen and the possibility is quite high. We don’t have social security in our country and if we go bankrupt or need support the state will not do much. Family and friends will generally be of little help. Basically it is very hard to travel by bus & train when you have been used to air-conditioned cars. When you turn back in life and put down your assets on paper you tend to find that you have a large balance of only emotions and many a times huge debts as well.

The other camp belongs to the “Creators” who perpetually believe that the sole objective of life is to provide for a better tomorrow and a tomorrow that he may perhaps never see. You must put away all the money you have into some safe saving, it is a precious commodity, it is life giving, save everything you possibly can etc are the thoughts of a creator. Save every possible rupee, live frugal; all for a better tomorrow. These are people who compromise today for the hope of a brighter future. That said the creators always have assets, they are always in surplus. They have little or no loans, never have to borrow for education or wedding of their children. Their quantum of assets however depends on their understanding of finance, money, planning and investment. Some will produce a lot more than others but generally all will have substantial money at some point of time in life. Their balance sheet is full of positive cashflows for now and for the future. They have provisions to see them through bad financial times as well.

The creators sometimes forget to live life. Many opportunities and experiences in life are missed. Life is routine and everyday is just the same grind. Things happen however but much later in life. The problem is that the excitement dies and when you are ready the time is not right. Is the feeling of power so powerful by being able to have a Mercedes when you are 60? What is the point of being able to go for a romantic holiday to Sicily or Bahamas you have teenage children and parents to be taken along? This is a matter of personal choice but I feel, what is the point of working hard and earning money where you are not going to spend it?

This can be confusing and that is something that all of us are thinking all the time and all the time we are in the quest to figure out where to draw the line.

There is nothing right or wrong on the camp you are in – either ways there is ample satisfaction and dissatisfaction for both camps. The question now is how do you draw that line to have more satisfaction and lesser dissatisfaction?