The 5 Commandments of Personal Finance

Commandments of Personal Finance

At its core succeeding at personal finance and achieving financial independence isn’t rocket surgery. All you have to do is spend less, save more and invest wisely. If you happen to need more information about one or more of these three pillars of personal finance, all you have to do is ask, and the Internet doth provide. In plenty. There are frugal challenges, and how to do no-spend months. There are forums and subreddits. There are blog posts about backdoor roths and 401ks and sometimes these posts fornicate like rabbits and produce posts about mega backdoor roths. Rainforests sigh in relief that the world is digital because an entire forest would have had to lay down and die to produce enough paper to hold all the information we have about debt repayment, asset allocations, tax efficient asset placement, the Trinity Study and using credit card rewards to subsidize travel. One doesn’t need one’s lazy butt to move an inch out of that comfy warm spot on one’s couch to set up accounts, automate investments and pick three index funds.

And yet so many of us still struggle and grapple and wrestle with our money (or lack thereof). We have the eye of newt, the wart, the cauldron and we’re pretty sure we’ve got that evil cackle nailed. Still, somehow, we just can’t get the Moolah Growantus spell to work quite right. It could be that what is missing is some good old fashioned human sacrifice to please the gods (and god knows you’ve been dying for an excuse to stuff that pimply adolescent brat from next door into the oven). Or maybe the spell isn’t working because you aren’t obeying the Commandments of Personal Finance.

Commandments of personal finance

Cue thunder. Enter stage right dude in robes with a Gandalf-worthy beard bearing a tablet of stone (because a Pinterest graphic just doesn’t have the same level of sexy as an engraved stone tablet). I give to you the 5 commandments of personal finance.

To Thine Own Self Be True

There is more than one way to skin the personal finance cat. There are advocates for building wealth via passive investing in index funds and there are those that passionately champion landlording. There are those that believe that you should pay off your mortgage as soon as humanly possible, and those that believe that doing so in the world of low interest rates is the mark of a diseased mind. Should you buy or should you rent? How is one to choose the best path to financial success?

By remembering that it is called personal finance for a reason.

No matter how much back of the napkin math you do that shows beyond a shadow of reasonable doubt that investing your money is better than paying down your mortgage, if your mortgage is what keeps you up at night, you’re going to have to deal with that first. There may be piles of money to be raked in by landlording, but if the idea of dealing with cranky tenants whining about broken faucets makes you want to fish your eyeballs out of your head with an ice cream scoop you’re going to have to stick to index funds. Some people can be extremely frugal badasses. Others (like me) are made of less stern stuff. You have to find a personal finance path that works for you.

You can’t live someone else’s financial life no matter how fantastic their blog makes their lives sound. What may be a fabulous look on someone else could make you look like a frump. If you attempt to ape someoneCommandments of personal finance else without taking your own oh-so-lovable quirks into account it is going to be like wearing gorgeous heels to a party that hurt so much that you can’t dance. The journey to financial independence is long. You have to be able to dance along the way. So, take a long hard look at yourself in the mirror and then to thine own self be true.



Know Thy Strengths and Leverage Them

Conversely, Know Thy Limitations and Work Around Them.

They say that doing things that are hard to do builds character, and I am sure that they are right. By all means build that character. When you stop a minute for a breather and to wipe the sweat out of your eyes, might I suggest something else to try? Do what comes easily to you. It beats the hell out of repeatedly falling off the wagon with a great big thump.

You have a financial superpower. Maybe even two. You just don’t know it yet. Maybe, like me, you have never ever had an iota of interest in cars and just want something reliable that will take you from point A to point B. Maybe you are a kick-ass cook and have always wanted to explore various world cuisines. Maybe you’re an immigrant, and you know for a fact that entire families can live very happy lives in very few square feet of space, and no, every kid does not in fact need their own bedroom. My I-don’t-give-a-rats-arse-about-cars superpower combined with my I-am-an-immigrant superpower means that I own a fully paid off second hand car and that I was extremely skeptical when told that I needed something bigger when I popped out a kid. Every single other person in our social circle bought either an SUV or a minivan when they had kids. Having that superpower means that when folks tease me about my lack of bluetooth integration or central locking or parking assistance or butt warmer, it doesn’t bother me because I am genuinely not the least bit interested in any of these things. I don’t have to battle the green-eyed monster. I use up none of my precious willpower to curb my spending in the area of transportation. This means that I have more willpower left over for the areas where I do struggle and need to work on getting my spending down.

Commandments of personal finance

The value of this commandment compounds if you are in a partnership and bring different superpowers to the table. Maybe your partner, like mine, is allergic to spending more than 15 minutes at a store like Target. Use that superpower. If I need something from Target, I’ll make a list and deploy Mr. BITA. If I go, I might be tempted to browse and pick up something I don’t need. If he goes we are assured that all he will be focussed on is a speedy exit. I know my limitations and I work around them by leveraging his superpowers.

The point is that there is something from your past, or some quirk of your personality, or some skill that you have that puts you at a financial advantage. Find out what that is, put your underwear on over your pants, don your cape and use it to kick some serious financial ass.

Get Thy Partner On Board, Or Thou Art Screwed

If you have a partner and you share finances, you and your partner are going to need to be on the same page if you expect to succeed in your endeavor to sock away a pile of cash and eventually sail off into the sunset.

If you are an ant, but your partner is a grasshopper, reading all the personal finance blogs in this universe isn’t going to make for a happy financial ending. It doesn’t need to be a perfect understanding. You both don’t have to agree on the proper job for every single dollar that passes through your hands. You both don’t have to agree on every single spending decision. Maybe one of you likes to eat out more often than the other would like. Maybe one of you thinks that the idea of giving up cable is an abomination unto the Lord. It doesn’t have to be a perfect understanding, but an understanding there must be. You need to be on the same page. You need to be in the same ballpark, playing the same game, on the same team, going for gold together. On any given day one of you may be the superstar, but both of you need to agree that this is a team sport and you are in it for the long haul together.

Keep Thy Mind Not Idle, Unless Thou Wantest to Fritter All Thy Moneys Away

Make no mistake, the idle mind is indeed the pal of the devil himself. Make all the financial plans you want. If you are bored you are doomed to failure.

A bored mind will come up with ways to spend money, not to save it. Worse still, a bored mind will spend money on things that don’t actually make your life better or fill that gaping void. Amazon used to be my void filler. I would spend my time binge watching a TV show, then feel guilty about having wasted all that precious time, then spend time browsing and shopping on Amazon because that was easier than thinking about how little I was accomplishing.

Find a hobby. Volunteer. Hike. Read. The low bar here is to not be idle. The high bar is to actually find something that makes you feel productive and fulfilled. A gold star if you can make this thing actually generate a revenue stream. The more accomplished you feel, the more satisfied you will be be. The more satisfied you are, the less likely you are to raid the piggy bank.

Plan Thy Life and then Plan Thy Finances

Listen up, because this is the most important commandment of all. Financial independence is not a panacea for all the problems of your life. It is merely a tool. A powerful one, no doubt, but a tool nonetheless. You need to be the one wielding the tool, not being a tool yourself.

If you are young and your FIRE date is a decade or more out into the future, fashion for yourself a life worth living now. FIRE will enable you to do more in the future, but don’t put your life on hold until you get there. Don’t confuse this with a rousing cry to #yolo and to spend like an idiot. This is a reminder to enjoy your life. Depending on what floats your boat that may or may not require you to spend a little more. The important thing is this: if you live a miserable life for a decade, you will continue to be a miserable person with $2 million in the bank, because being miserable is all you know. You won’t suddenly have the skills to go out and make friends and foster relationships. You won’t suddenly be less afraid to leave the familiar and travel far and wide. Wonderful adventures will not suddenly befall you.

Dive in. Get a little dirty. Get a little bruised. Build a life that is truly worth living, and then build up your finances to support that life.

Commandments of personal finance


23 thoughts on “The 5 Commandments of Personal Finance”

  1. Love this!

    First off, personal finance being PERSONAL is one of the hardest things for people to understand. We spend more time paying attention to others finances (blogs, TV, advertising) and less time on our own. This can be negative “Keeping up with the Joneses” but also the negative result of positive influences like reading blogs about people who have “made it” and here is how. Comparing yourself and your challenges at THIS moment to someone who is 4 steps ahead of you is never a good feeling. I try not to do that but it’s hard sometimes – we all have those moments of self destruction that we have to remember its PERSONAL!!

    As for being on the same page as your partner? This is something we struggle with. I am proactive (duh) and he is reactive. I say make the kid get a job for college – he says kid will get scholarships and loans when the time comes…GASP!! I don’t even want to know what page he is on but I am guessing it is somewhere between the front cover and table of contents! I only hope that all my rambling will eventually click but I am guessing it will be an outside power that eventually gets to him…I mean, what do I know about money??? 😉

    And, of course, your other points are spot on. We all need a super power to make ti through the tough days. I am quite frugal but not to the extent of reusing toilet paper…ok, maybe a paper towel or two! But a new car? Not on my radar…I’ll keep my old rusty beast until she causes more problems than good. And being miserable is a mindset. Money doesn’t buy smiles last time I checked. That all come from within. People in some of the poorest countries smile more often than most in the richest cities. It’s a decision. Make it as easy and as often as you decide which foot to put your shoe on and your world will open up completely. 🙂

    1. I agree. It is really hard not to get competitive about FIRE, especially if being competitive in general serves you well in your day job and in your career. In general I tend to be very satisfied with my lot, but I am not immune to attacks by the little green monster every now and then.

      Does your partner read your blog? Have you tried to get him to read any of the others that you love? Continue to be patient. You never know when that little light bulb is going to switch on and he will have his a-ha moment. And if that is not to be you can always just keep your finances separate. I know many couples who do this very successfully.

      Reusing toilet paper? Ew. Ew. Ew. That is just plain wrong. There is a time and a place to be judgey and I am exercising that right right here and now.

      And you are so right about happiness being a decision and a choice. It isn’t always the easiest one to make, and some of us are genetically predisposed to be happier than others, but it absolutely is a choice.

      1. Hahaha! Judgey wudgey was a bear (finally a chance to use my SATC reference!).

        He doesn’t read my blog but we keep our finances separate so it’s all good. With alimony (for the next 10 years!) and child support payments he is just in a different ballgame. I realize his reaction based gear is due to survival mode. Can’t blame the guy when he is for the most part keeping his shit together! I help when I can and make sure he hears some podcasts when we are in the car together. Perhaps I can play them at night for a bit of osmosis?!

        As for the happiness, I still have to work at it. One thing that has helped is being aware of what others look like around me. Not their clothes, hair, or make up, but their faces. I saw a flight attendant in the terminal the other day. Man oh man she looked MEAN!!! I crossed my fingers she wasn’t working the next flight with me and low and behold when o got down the jetway there she was. And you know what? She was awesome!! Nice, friendly, gorgeous smile. I couldn’t believe it was the same person I had just seen scowling in the terminal. But it turns out she wasn’t scowling. She just had a serous case of RBF – resting bitch face. Girl, don’t think I haven’t been smiling to the nines since!! I never want someone to mistake me for what I saw in her. 🙂 🙂 🙂 Now I smile like I’m insane. Too much??

        1. Oh boy! Ten years of alimony coupled with child support. That is tough. I like the night idea. Sneakily seep into his subconscious.

          RBF is so real. That poor woman! Very early on in my career I was given feedback in my annual review that some folks considered me to be unapproachable. My manager’s feedback? Try and smile more. So I did. Two days later I was called back into a one-on-one with him. He told me that my fake smile made me look like a serial killer and could I just please go back to not having a smile plastered on my face all the time. Some people can pull off a lot of smiling. Apparently I am not one of them.

    2. I totally agree that we all have those moments of self-destruction and we really have to discipline ourselves to balance what we need versus what we want. This article is really helpful for people to understand personal finance more. Me and my partner have been together for five years now and we’re planning to settle, but we talked about it that we would respect our personal finances. Planning is really crucial that is why we should always be wise and aware of our limitations. Either way, it is truly called personal for a reason. We make our own decisions and choices.

  2. Remembering that it is personal finance… exactly!! Noone can get where we did by doing what we did because they’re in a totally different situation and mindset, unless they’re our dopplegangers. Then maybe…

    Definitely need your partner to be on board or at least stick with it until you can show you’ve really been living that way for a year and they didn’t even notice. (Sorry Mrs. SSC, lol) At least I came around though right? I wasn’t defiant like, “You shall not work towards FIRE because I deem it unworthy/impossible/ridiculous” It was more of a “Meh, whatever floats your boat, but I’m not quitting to live off $25k/yr. I’m just saying…” Fortunately, our number is closer to $55k/yr and yeah, minus our convenience expenses now, we are on track for doing that, and probably less than that, but it’s realistic without feeling miserly.

    It’s all about what fits you, your personality and your situation. Figure that out and make it work for you. Well put!

    1. I’ve said it before: Mrs. SSC deserves a prize for putting up with you so patiently!

      I sometimes have a tough time remembering who I am and what will make me happy. A great example for me is the Frugalwoods blog. She writes well and her pictures are awesome and I’ll get all caught up in the romance of her life and for a brief moment even convince myself that I totally want a homestead like that. Luckily I come to my senses and realize that that reality would make me very unhappy. I am a city person, and no matter how gorgeous, that lifestyle is just not for me.

  3. I couldn’t agree more with “Plan Thy Life and then Plan Thy Finances.” There is no point in being a miserable just so you can retire early and continue being miserable. We never made painful spending cuts, we just cut spending that wasn’t bringing us added happiness 🙂

    Do people really need butt warmers in California?

    1. We haven’t made any painful cuts either and I don’t ever see myself doing an uber-frugal challenge. Like you, we just wised up about our spending and were pleasantly surprised by what a big difference that made.

      About butt warmers in CA: Californians have many lovable and admirable properties, but no one could ever accuse us of being particularly hardy in the face of the elements.

  4. “Dive in. Get a little dirty. Get a little bruised. Build a life that is truly worth living, and then build up your finances to support that life.” – love this line 🙂

    Really like your writing and agree that finance is very personal, what might work for us might not work for you. Although most in this community are very open-minded and acceptable, we’ve also came across some articles where ‘the other way’ (whatever that was) was criticized in an awful way. Not very inspiring.

    I’ve been fortunate to have a partner (Mr. Divnomics) who is on the same level as it comes to investing our money. And since recent, he’s even reading other blogs and listening to podcasts about FIRE.. who knew. It definitely helps to form our lives the way we want to and think of what we need to support that life, or to make the steps to get there.

    1. Thanks Divnomics, much appreciate the compliment.

      Yipee for your partner getting more interested in our world. Mr. BITA and I are on the same page w.r.t what we want to spend on and how much we want to save and also about our whole FIRE plan. That is the extent of his involvement though. The only FIRE blog he reads is mine (he is my editor)!

  5. You can’t overstress having your partner on board is critical. Between that and knowing yourself is half the battle. Only if you truly want something will it happen. And if your spouse is pulling the opposite way of your want it won’t end well.

    1. Yep. Yep. Yep.
      For anything that is as long haul and challenging as FIRE you are only going to get there if you want it badly enough to make the sacrifices needed to make it happen. If my spouse wasn’t on board this journey would be unpleasant and not likely to result in success.

  6. Awesome post. I agree with you on all of these, and now I feel like picking up some medieval literature since you got me into that language mode. That whole last section is just a perfect reminder to seek balance. Not simply striving for wealth or retirement, but also striving to live to the fullest in the present. You truly cannot know how your life will play out, so putting everything off until some major event isn’t wise. It’s too risky and life is too precious! But as you pointed out, you can live fully without making stupid decisions in the name of YOLO!

    1. Thanks Kate! The FIRE journey is a long one, especially for those lucky enough to discover the path in their 20s. A decade or more of doing nothing but checking your spreadsheets seems like a very depressing sort of life. I wanted to remind folks that FIRE is a fantastic goal, but it shouldn’t be an obsession. You don’t want to wake up one day with nothing else to show for your life other than a lot of money in the bank.

  7. “A bored mind will come up with ways to spend money”
    This is the one that scares me. When I daydream about what I should buy, I stop and look at similar things I bought in the past and how happy they made me and the answer is not much. I also analyze how much I will use it and how it can positively affect my life and goals.

    1. I think the fact that you are self aware enough to know that you should be worried about this puts you ahead of the game. Reminding yourself of past purchases is a good strategy.

  8. I really like your focus that finances are just a tool. You have to do what fits your life, and you have to find happiness along the way. So true.

    And it’s good that couples can balance each other’s strengths if they work together. No way I’d be renting real estate if the hubby didn’t have mad DIY skills. On the other hand, he’s mostly happy for me to handle the paperwork. And I’m lucky to have learned a bunch of frugal living tips from him, but I had to be willing to learn them. (It did take a while. Sometimes you have to have faith that you’ll come together in execution eventually if you’re together in spirit.)

    1. I wish either of us had mad DIY skills. Or any DIY skills. Or anything that remotely resembled a DIY skill. We’re less handy than a doorknob.

      Your point about being willing to learn from each other is spot on. Instead of getting stuck in the “why can’t he/she do blah blah better” mindset it is generally ore productive to ask ‘well what can he/she do better than me?”. That way the whole becomes greater than the sum of the parts.

  9. Your first tips is SPOT ON. I hate one size fits all personal finance advice because we are all so different and want different things out of life. I think that is the most important thing for everyone to recognize!

    1. Isn’t it? We don’t wear the same size clothes or attempt to stuff our giant feet into teensy shoes because it would be uncomfortable. Being uncomfortable with your personal finance plan will result in much worse things than a couple of blisters, so there is all the more reason to make sure that what you do fits you.

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