Financial freedom is having options, not just having money to spend

I remember times when I didn’t have enough money to buy the stuff I wanted. Still plugged into the world of consumerism and advertising to some extent, the stuff I couldn’t afford bugged me.

What I discovered was not that it bothered me because I really needed the stuff and it would give me lasting improvement of quality of life. What bugged me was that I didn’t have the option of having it. I couldn’t afford it, and because I wasn’t brought up to buy consumer goods on credit I couldn’t have it.

It took a bad experience at work to show me that there was something a lot worse than not being able to afford consumer tat. It was not having options to walk away from bad situations.

Our American friends, with their delicious lack of irony, can get away with saying things that would just sound hokey and ridiculous from me. In this old newspaper clipping, which is a 1963 ad for a savings and loan company.

The Pleasure of Walking Tall (cringe)

It highlights the advantages of financial freedom –

A man with­out sav­ings is always run­ning. He  must.… He must take the first job offered, or nearly so. He sits ner­vously on chairs because any small emer­gency throws him into the hands of others.

Two-and-a-half years ago I sat in an annual appraisement, when The Firm had had a general annus horribilis due to incentivising the salesforce to sell products without evaluating whether they were profitable first. And I listened as a little twerp of a line manager told me he was going to slaughter my appraisement because the project I had been on had been cancelled and my skills didn’t fit in his area. He did it because he needed to score a decent number of negative hits. I was in a weak position, had had some upheaval in my personal life, and had no options. I didn’t have savings, so I had to sit nervously on the chair. Nowadays I would read him the riot act and launch a grievance (you aren’t actually meant to drop someone down three grades without giving them some warning in the preceding quarter, so I could have nailed him for not giving me a heads up first).

He can take a level stare from the eyes of any man.…..friend, stranger or enemy. It shapes his per­son­al­ity and his character.

The ermine is a noble and proud creature, and chose to take action so that this would never happen again. That means independence of working for a living. Getting another job is not the answer. There’ll be another jumped up twat who has just had a child, has no savings, and is desperate to achieve his objectives at my expense so he can continue to afford to pay interest on the debt buying his nice middle-class lifestyle.

Having savings, and therefore options, makes it easier to resist the blandishments of consumerism. Now, I can walk into a store and look at the stuff they have, all gaudily pushed for the weak of will. I can look at it, and think to myself “yes, that would be nice. I can easily afford it. But I’ll pass, because I don’t have a need for this stuff, and I know the want leads only to fleeting satisfaction for a few days”. After a certain point, it is the people in your life that matter, and what you do with them, not what is in your life.

Somehow, having to option of buying the stuff, without particularly breaking a sweat, makes it easier to say no. You can ignore all the 10% off, SALE, everything must GO signs. I’m old enough to have seen it all before, and rich enough and ornery enough to be perfectly happy to pass up on the offer if it means I can take the time to consider the purchase at my leisure. If the damn thing costs 50% more, so what? I don’t buy consumer goods often enough and they are such a small part of my budget that I can afford the luxury of consideration. And many of these offers are cyclical.

I don’t understand the fuss made on Martin Lewis’s moneysavingexpert site about topcashback and quidco etc. Obviously if you are going to spend a shedload of cash on some consumer goods then for sure, try and spend less using these sites. However, the truly radical money saving tip is don’t buy the stuff in the first place, guys.

Ivan Illich, seemed prophetic in the 1970s when he wrote in Tools for Conviviality

Elite professional groups . . . have come to exert a ‘radical monopoly’ on such basic human activities as health, agriculture, home-building, and learning, leading to a ‘war on subsistence’ that robs peasant societies of their vital skills and know-how. The result of much economic development is very often not human flourishing but ‘modernized poverty,’ dependency, and an out-of-control system in which the humans become worn-down mechanical parts.” Illich proposed that we should “invert the present deep structure of tools” in order to “give people tools that guarantee their right to work with independent efficiency.”

Look at so many of the products people will buy for Christmas, they are a lock-in to a complex system of more payments. For example, an Xbox, a mobile phone, Sky TV, a gym subscription, a motor car, a twin-blade razor, contact lenses. So many ways to engineer extra costs into your life, and you tend to do that once you have sunk some costs into it. It was such a relief when I sold my Sky Plus PVR to a friend at work – it had suckered me into an extra £10 a month!

There are also deliberate attempts to change time-honoured ways of doing things into things that require continuous locked-in purchases of overpriced consumables. Take a Nespresso machine, for example. What a daft way to overpay for coffee. Any product that has a club on the website should ring out ripoff alert in big letters. With a bog-standard filter coffee machine I can get my coffee from anywhere, in any quantity I want. From Tesco to some hideously overpriced London coffee emporium selling me Java Blue Mountain air-freighted fresh that morning, no doubt.

I have the choice of how strong and how much I want, by varying the grind and the ratio of water to coffee. If I am lazy, I can use a coffee machine – this is in fact how an Ermine rouses himself, by loading a coffee machine in the evening, and using a wireless remote control to start this in the kitchen from the bedroom 🙂

If I am not lazy I can use a filter cone, a French Press or a stove top espresso maker. With the exception of the filter cone, zero waste bar the bag of coffee beans, and even in the case of the cone, the waste is compostable paper.

With a Nespresso machine, my choice of coffees and choice of suppliers is narrowed massively, to the 16 of the Nespresso range and to one supplier. I’d waste an aluminium capsule each go, so wasteful that Nestle have to come up with a whole greenwash site to assuage the eco-consciences of their customers.

It’s absolutely and staggeringly bizarre. Nestle have designed a complex system to wastefully lock-in their customers by replacing a perfectly serviceable and simple range of historic methods of extracting coffee from ground coffee, purely so they could make more money. And people will willingly buy this. Illich would despair of us.

Savings. Yes, there’s a lot to be said for them. Most people save in order to buy something. That’s good, particularly is the alternative is to use credit. Though the most common reason for saving, it isn’t the only one.

I save to buy power and freedom – the freedom to walk tall in the 1963 ad. The ad looks really odd to 21st century eyes – modern ads for savings accounts emphasise saving up for something like a house, or the advantageous interest rate. I have never seen a modern ad advocating saving to buy yourself independence of thought and action. Wage slavery is too ingrained in our culture, and we have surrendered to Illich’s modernized poverty.


19 thoughts on “Financial freedom is having options, not just having money to spend”

  1. Another outstanding piece, Ermine. I’d never thought about those products like that before. You could almost consider them as ‘the gift that keeps on taking’.

    The scary thing is that Nestle probably spent millions developing those machines, so clearly thought there would be a market of saps out there willing to buy the damn things.

    I sometimes truly believe humans have reached the limit of evolution….


  2. Ah yes, Ivan Illich. I actually attended a lecture of his at my university back in the ancient past. Many of the points he made then are as relevant as ever, even more so as we approach peak oil. He’s worth reading again, I think. Brilliant man.

    I like to think of my small collection of stove top espresso cafeteras and French presses as convivial tools. So what if I run out of Melitta #4 coffee filters!

    The only coffee product Nestle’s created that is anywhere near convivial status is Nescafe! You can buy Nescafe anywhere in this world, from bottles to tins, to pouches, to packs! And it is also useful in breaking language barriers: ” Do you have coffee?””No.” “Do you have Nescafe ?” ” Ahhh yes, we have Nescafe!” “You want Nescafe ?” “Yes,please.” Most countries are tea-drinking!

    Alas, I am still a wage slave, but a consumer debt and mortgage free wage slave, and since I don’t own a car, but a savings and brokerage account, I have no choice but to walk tall, knowing that, in the future, I too may have options.


  3. I wish I could find an original copy of that advertisement so I could frame it and put it on my wall.

    Sums up Financial Independence for me.


  4. As usual excellent points well expressed. However, I do disagree with your evaluation of cashback sites. I use them mostly when buying insurance, pretty much essential purchases. I have so far recieved £360 back on these buys. Although, lately it’s becoming harder to find good deals with cashback (market getting wise, perhaps)


  5. A brief Googling led me to find out:
    First Federal Savings and Loan Association of St. Petersburg changed names to Florida Savings and Loan in 1990. In 1991 it was seized by federal bank regulators. Remaining assets of $250k rather than $250M.

    Nevertheless, a fine bit of writing!

    I was walking tall until this weekend. Then I made an offer on a nice country house that we’ll turn into a rental… an hour ago I learned the offer has been accepted.


  6. spot on, I am with you in the part of having options with savings, It was the succession of crap jobs, that made me determined to build up my own war chest, freedom to choose whether or not to work and more importantly freedom to choose who to work for and who not to work for.


  7. The system requires that we constantly increase our consumption of products and services (and there doesn’t seem to be an available alternative to this at present).

    Even simple living in Suffolk is surely dependant upon the macro environment it turns away from.

    And I, though not much of a consumer either, depend on the majority who are to equip the system to supply me wiht this computer for example..

    Where will the UK economy be without the orgiastic shopping for Xmas junk. Maybe we will find out in 2012.

    Consumption is more muted in Switzerland. Acculturated now, I feel shocked whenever I visit Brent Cross shopping centre in London and see the frenzy of which I was part a few years back.

    The non-practising millionaires of Zug (see my blog for a short piece on this) – suggest that it will end in consumption exhaustion one day perhaps.


  8. WTF! Here’s an equally cringeworthy advert from India on TV peddling old age pension, as early as the 2000s. And the theme has been their goose and they are continuing to milk it!

    > Ermine rouses himself, by loading a
    > coffee machine in the evening, and
    > using a wireless remote control to
    > start this in the kitchen from the bedroom
    The geek in my likes to think you built it by yourself?

    Otherwise, this is solid post. Resonated with me. Peak oil, and the drive for ROI and efficiency that “creatively destructs” more jobs than it ends up creating means we are in the grips of a long winter…. Better wash away all illusions and become more stoic as the days roll by.


  9. > as a little twerp of a line manager told
    > me he was going to slaughter my appraisement

    Be happy this was a one-off. For the majority working here in India in the IT/ITES area. This is a fact of life *every year*. Seriously.


  10. @MM “the gift that keeps on taking” – inspired 🙂 It’ll help me keep my resolve against these cashflow leeches.

    @g – I didn’t realise most of the world was tea drinking, as I’ve never travelled outside the US/Europe. I’d assumed coffee was de rigeur, with the possible exception of the UK itself. Agreed on Nescafe, it’s not the right way to do that job at home IMO, but on campsites, farms and building sites it scores on the shared experience and practicality/no waste.

    @Yabusame, google “A Man with Savings”. The text didn’t originate with that ad, it seems to have been a meme of the time that they used. There are copies in better condition, but I like the gonzo format of the ad!

    @George, you should still be walking tall after the weekend 🙂 Financial assets are not the only form of savings, non-financial assets have their place too, be they pear trees in the yard or in your case a site that pays its interest in rent.

    Indeed, with the current systemic risks to the financial system and the tendency of financial assets to move in synchronism at the moment, diversifying into non-financial assets seems the only way to get better security.

    @Dreamer, I haven’t got there yet as far as choosing not to work, but it should be less than a year. I’m not sure I will even choose to work for anyone other than myself afterwards. I envy you the choice!

    @Trevor – yes, agreed we have designed a system that needs growth. It’s been amply supplied by both a growth in population and in energy resources. Even if that stayed the same, however, your non-practicing millionaires show that there may be a problem even with BAU. Rising affluence may not result in equivalent rise in consumption. My consumption has dropped with rising affluence, I value reclaiming my time and freedom of action more than the opportunity to consume more. However, looking around me, I would say that the promoters of consumption are still getting their message through. It won’t be a loss of the general desire to consume that will do for us, it is the loss of income that may arrest the economy, as power shifts away from the workforce towards capital. Capital doesn’t generally consume a lot, people do.

    @Surio, years ago I built one of those using a Holtek H12E and D chips to get reliability from some licence-free radio modules. Nowadays there’s no point, China makes these things for virtually nothing. You can’t beat this for £5

    Be happy this was a one-off.

    It won’t be. Although other tensions in my life at the time mean it is possible I over-reacted, I did correctly read the writing on the wall. Monevator picked up this article on when incentives go bad which shows what goes wrong with performance management incentives. You destroy the esprit de corps of a decent workforce, turning it into a paint-by-numbers operation, and endless surveys and requests for customer feedback so people can pump up their objectives and cite measureable evidence. You also pitch individuals against each other. ERE cited some of the issues in his post the gamesmen.


  11. Hi Ermine, me again: This time with a link to some great graphs on the BBC website, picked by leading Economists to sum up the one thing that struck them about the economic crisis this year.

    Some great charts, most of which highlight the incredible naivety of the Euro creators – the first one has an amazing symmetry – basically the risky countries before the Euro are the same countries who are now close to defaults. the interest rates they are paying to get their debt away is almost back to where it was when the Euro was formed. no wonder they all wanted to join the Euro.

    But looking at images 8 and 12 shows that while the expectation was that once united in a single currency all the members would simply knuckle down and strive to be as good as Germany, the reality is that they all sat back, had a kip, and 10 years later woke up to find they were even less competitive than when they joined the Euro, and thus had to borrow shitloads of money to bridge there gap between their earnings and their spending. Who would have thought that? Simply amazing.



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