What Money Game Are You Playing?
As noted before and worth repeating again, personal finance is personal. No one is crazy when making financial decisions because they make those decisions based…
Author: TJ Tann
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As noted before and worth repeating again, personal finance is personal. No one is crazy when making financial decisions because they make those decisions based…
As noted before and worth repeating again, personal finance is personal. No one is crazy when making financial decisions because they make those decisions based on their unique set of circumstances, experiences and knowledge. However, there are common themes in what many of us aim for despite how vastly different each of our circumstances are. I’d argue that all of us are playing at least 1 to 3 money games at any point in time: survival, money accumulation for material acquisition or wealth generation.
It is important to understand what game you are playing and what game you want to be playing. The game you decide is the one that governs your behaviors, motives and opportunities. Whether or not you realize what game you’re in, it is likely that whichever it is has a profound impact on how you operate everyday, manage expectations and deal with fears. Like a real game, how one arrives at the desired end goal is largely informed by the strategies deployed to get there. It is important to first become aware that you actually are playing a game, then understand what game, decide which one you want to play and finally how best to win.
Survival: Earning Just to Earn Again
The first game is survival. In this game, the goal of working everyday is to earn just enough to make it to see another day. Money earned is money spent just to earn money again. Income is immediately allocated to cover living expenses with little or nothing left to save or invest. Rarely is there enough space and time to thoroughly plan out finances, set goals and seek new opportunities for income generation. Any concern outside of meeting basic daily needs seem so distant they are not even worth allocating minimal energy to entertain.
This game is unfortunately what most of us in America play even across income levels. In a survey of over 28,000 Americans 54% of Americans said they live paycheck to paycheck including 40% of high income earners ($100,000 and above) saying they also live this way. More than half of the country, over 115 million people, simply live for the next time they get a paycheck.
In the game of surviving, the ability to plan for the future is severely constricted and so is the ability to protect oneself from inevitable life mishaps and emergencies. For instance, 40% of Americans would struggle to come up with $400 in the event of an unexpected emergency. For players in the surviving game there is little to no buffer between current financial stability and potential financial ruin. Survival is the hardest money game to play because the end goal is neither clear nor appears in reach. Is the goal simply to just have enough to get by? Is the goal to eventually stop working? Or maybe a goal is temporary and surviving is the only way to get through in the moment? In any case, it is hard to win a game when you are not sure what the definition of winning actually is.
Money Accumulation for Material Acquisition
Money game 2 is money accumulation for material acquisition. The game begins when a job offer is signed, money is realized from a side hustle or a series of them. A lotto might even be won. In this mode, a player might not be directly concerned with making ends meet. It is almost a given that groceries, gas and rent will be taken care of. With basics covered, life calls for higher ambitions where those ambitions often manifest materially. At the minimum game 2 has a clear goal: make more money to buy better and bigger stuff. More often than not the point of gaining money is simply to release it in exchange for the latest tech, fashion or subscription.
The rules of this game are socially regulated. What constitutes a wrong or right move is dependent upon whether or not peers would vote one way or the other. This is what is referred to commonly as “Keeping Up with the Joneses.” It is more of a powerful force than one might think. To some degree, we all participate in this game because we do not live in a vacuum. Our opinions, actions and decisions are influenced by other people no matter how badly we want to believe they actually are not. The key difference here is that those fully immersed in money game 2 are driven by accumulating more money for more things. Success is defined in that way. A higher salary or a new job is seen mostly as a ladder to more. Income increases translate to lifestyle increases. It is the primary lens to view life.
Money accumulation for material acquisition too is a hard game to win because the definition of winning is rooted in an ever changing idea of what it means to be successful. It is not the fact that it isn’t clear what a win is, but rather that the goal post or hoop keeps moving farther away the closer one gets. The pride of purchasing a new car is quick to dissipate at the prospects of buying a new home or vacation spot. The feeling of success is fleeting. This game is the hardest to detect. Most who play are unaware why or even how long they have been playing because money game 2 is embedded in our culture, a culture of consumption.
Wealth Generation
If you can tell by now no game is easy to win. The final money game, wealth generation, is no different, but the rewards are more clear, internally defined and in my opinion the most worthwhile pursuit. The goal of money game 3 is to earn back your time in order to control your daily activity. Success is measured in time, not just money. Sure, it would be great to amass a large sum of money, but instead of using it to purchase things it used to purchase your time. The wealthiest people are not the ones who have the biggest house, nicest cars or take the most trips, although that may be true of some. The wealthiest people are the ones who can wake up on any given day and decide what they would like to do without fear of consequence. Read that again.
The goal seems to be clear, but as with any worthwhile pursuit it is easier said than done. Personally, this is the game that I am playing. At some point in life it would be nice to be selective in how, where and when I work. I am a long way from that, but I’ve studied and learned from a lot of people who have made it there. There are a few core components that I think are critical to building wealth. First is to actually think it is possible coupled with the belief that you have some degree of control in your financial future. Following is mapping out a financial plan on how to get where you are going. The final one is to enjoy the process because if it is teeth grinding to place money in an investment account instead of blowing it then the road ahead is bleak. Find ways to make generating wealth enjoyable or at the very least think of it as a game.
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