The best thing in life?
I've had a little time to think this week. Probably doesn't hurt that this is my view as I am writing this post...
I got really into personal finance about five years ago, just before I started RetireJapan. It has transformed my life for the better in all sorts of ways.
If I had to choose one thing that has made a difference though, it would be 余裕 (yoyuu), or slack.
I think the highlighted definition works well: the loose or unused part. For me personal finance is mainly about security and freedom. But mostly freedom.
And a huge part of freedom is having slack, whether some time in your day or money in the bank, not being 100% committed has to be one of the great luxuries in life.
There are several steps to this in terms of money:
- If you don't spend all your money every month, if you are saving a percentage of it (hopefully at least 20%), then if something comes up you can use that extra money to deal with it instead of saving
- If you have money in the bank for emergencies (hopefully at least a few months' worth of living expenses) you can use that to deal with unexpected problems instead of having to borrow money or sell things
- If you have investments that produce income (dividends, interest, royalties, rent) you're slightly protected if you lose your job or have to take time off. The more income, the more protected
- If you have enough investments then you can stop working and still live the lifestyle you want. That is the ultimate slack (in both senses of the word!).
And of course slack doesn't just relate to money, but also to time, energy, emotions, goodwill, etc. Running at redline is stressful, exhausting, and ultimately damaging.
Do yourself a favour and build some slack into your life. The easiest way to start is to just put some money away every month.
What about you? Do you have slack in your life?