Financial freedom is outdated; try optimism instead

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I am sick of advice about how to achieve financial freedom. Freedom from what? I have asked some people, who I will not link to, since I’m dissing them, and the most common answer is that they want to be able to make decisions about their life based on what they want, not on what they can afford.

HELLO???? Can everyone standing in line to buy a Lear Jet please get a reality check? You do not need a plane to be happy, you need a plane to go visit the people who make you happy. A jet is not an expression of financial freedom. It’s an expression of your decision to not live near the people who mean the most to you.

I think the root of the idea of “financial freedom” means freedom from having to do a job you don’t like. But this thinking comes from the baby boomers who felt compelled to climb ladders doing jobs that destroyed their personal life.

Today we don’t do that. Many people of ladder-climbing age today don’t believe it’s worth the trouble. Today you can hold out to get a job you love at the beginning of your career. Financial freedom is not a prerequisite.

Financial freedom is becoming an outdated goal for today’s workers. Jim Buckmaster, chief executive of Craigslist, mystified Wall St. analysts when he explained that he’s not interested in building a megacompany, and he just wants to maintain Craigslist as a company that gives people what they need (via the tweney review).

But I think most people are not so much mystified as just plain grateful for the down-to-earth attitude at Craigslist. And plenty of research shows that the people at Craigslist have the right attitude; it’s futile to make money a career goal since you’ll never feel like you have enough.

You know what really determines our happiness levels? Not money, but how optimistic we are and how often we have monogamous sex. Money cannot solve big problems, like cancer or world hunger or happiness. Money solves small problems, like, can you have a big wedding, can you go on a good trip. Small problems are what people talk about when they talk about “I can help you get financial freedom.”

But why spend your life figuring out how to get rid of small problems with money? You can work hard to make yourself a more optimistic person, and then you will be able to overcome most small problems. So let’s stop talking about financial freedom and start talking about learned optimism.

Optimism is the ability to see the world in a positive light. Optimists are happier people, and there is no reason why everyone shouldn’t attempt to think more optimistically. Don’t tell me a happy outlook will squash your creativity. Part of creative production is the manic optimistic self-confidence that what you are thinking of is a great idea.

How does this relate to careers? Once you make the switch to thinking like an optimist you will have real freedom — freedom to do what will be fulfilling and accommodate your personal life instead of what will make you rich.

34 replies
  1. Cynthia
    Cynthia says:

    I believe that I have been misusing “financial freedom” to sum up my goal–thank you. I started regularily checking out your blog a few weeks ago, and have already sent the link to several of my friends and colleagues. Cheers.

  2. Bill C.
    Bill C. says:

    A jet is an expression of how much money you USED TO HAVE before you bought that jet.

    I agree that many people have allowed their jobs to “destroy their personal lives”, and all they’re looking foward to is retirement so they can do what they actually wanted to do with their days.

    I don’t know what monogamy has to do with anything :) but sex definitely determines happiness levels more than money. That’s what most guys do with their money anyway… “buy” sex in one format or another, including picking her up for that date in the Porche and taking her out for that expensive dinner.

    Financial freedom is very simple…

    spend less than you earn

    * * * * * * *

    I like your definition of financial freedom – I have to think about that.
    And about buying sex: The research that shows that sex increases happiness shows that this correlation only appears when you have a consistent, committed partner.

  3. Sarah Davis
    Sarah Davis says:

    I’ve been reading your blog for a few months now. I think you have some good things to say and I’ve been enjoying it, but you seem to be repeating yourself.

    1. Do you think maybe you’re a little stuck on lumping the “baby boomers” into one large category and declaring them the cause of all evil? I’m 45 and don’t know where I fall in your generalizations about this.

    I have always been more interested in work/life balance than the culture at large seems to be and have taken time off to do other things besides have a conventional work life – including a 6 month period living at a yoga ashram and 2 month trip to visit friends and wander around Italy. I have friends my own age and even (gasp) a few years older who also have not lived the more work at all costs oriented life you seem to be attributing to us. I like the way you also declare that no one “now” works too much at the expense of their personal lives.

    2. You seem to be in a rut repeating this same data about positive psychology and this statistic about sex making us happy, etc. I feel as if I’ve already read the second half of this post a few times before on your site. Yes, positive psychology is trendy right now.

    * * * * * * * *

    Thank you for the thoughtful comment. I responded on a separate post, here:


  4. Åsa
    Åsa says:

    Penelope! As always: a very good post! Your topics are always inspiring. And the part about happiness and a consistent, committed partner is great news! That's what I call base-camp right there.

    I want to take this opportunity to wish you a Merry Christmas and thank you for all your insightful posts.

  5. Laura
    Laura says:

    Hey Penelope. I just wanted to comment, because when I started reading this post, I felt myself tense up a little and get defensive. I thought I would disagree wholeheartedly with this post, because I have spent a lot of time wishing for financial freedom, especially in the last year and a half.

    But a funny thing happened as I kept reading… when you wrote that financial freedom is not a prerequisite for finding a job you love, and that we don’t HAVE to achieve financial freedom, I actually felt relief. Very unexpected. It’s fun to imagine what life would be like if you never had to worry about money and could spend what you want, but it also creates stress and negativity because it makes you focus on what you don’t have rather than what you have. And if you dare to set financial freedom as a goal, that’s a big whopping goal and it’s overwhelming to address it. I just wanted to say thank you for giving me permission NOT to achieve it. I didn’t realize how much pressure I was putting on myself.

  6. Diana
    Diana says:

    To me, “financial freedom” is freedom from money, NOT freedom to buy whatever the heck you think will make you happy. And I agree with you, too, about the power of an optimistic approach to life’s challenges.

    I believe there is a certain wisdom in the “minimal living” concept. Why buy a gigantic mansion when you can live comfortably in something much smaller if you just toss out all the crap you’ve accumulated? I know this is a little bit of a tangent, but I think many people don’t realize how happy you can be withOUT all the accoutrements of the “good life.” Are the only happy people the ones with flat-screen TVs?

    My current goal is financial STABILITY, viz. the ability to pay for things that I need (a place to live, bills, food) with some left over for savings and the occaisonal indulgences (new clothes/shoes when the old ones start to get ratty, new appliances to fix the ones that break all the time, etc). I don’t want to throw myself into debt trying to live beyond my means. I know I’d be *much* happier just being confident enough in my finances so that I DON’T HAVE TO WORRY ABOUT MONEY. Having that financial confidence would be the greatest luxury imaginable. Sure, if an emergency comes up (natural disaster, life-threatening illness, etc.) almost everyone (excluding the fabulously wealthy or the ridiculously well-insured) will have to worry about money.

  7. Eric Wong
    Eric Wong says:

    Hi Penelope,

    Great article once again, network marketing and insurance sales (which I used to do), often stessed the importance of financial freedom. But I have seen many people chase financial freedom down the wrong alley and some end up cheating their clients or spend so much time chasing it that they neglect the people that they are earning the money for, their love ones. That is 1 reason I left insurance sales.

    I do believe that earning $40,000 a year is quite optimal to lead a meaningful life, and my work philosophy has changed to making sure my work does not engage in activities that disadvantage others directly such as use of child labour and harming the environment etc.

    I think financial freedom in my dictionary would mean contentment and the ability (time) to spend the money that I earn on the ones that I love.

    I write all the time about all the research that says that $40,000 a year is enough to be happy. And eventhough I really believe that, (based on my own experience) I only hear complaining from people that $40,000 is a crazy-low number. So it’s nice to hear that someone agrees. Thanks for the comment.


  8. stever
    stever says:

    much like a few above, i started reading a few weeks ago (after one of many LifeHacker links).

    anyways, I agree with pretty much your entire post — can I borrow a couple grand? :)

  9. MyNameIsMatt
    MyNameIsMatt says:

    I definitely agree with what you’ve written, and saying this stuff helps, but the problem goes farther and deeper. I’m a person who’s been saying this for some time (and more recently in a blog), but it rarely seems to affect people. Generally, just living that way and telling others that’s how you came to be in such a good position has more affect then telling (show don’t tell – always good advice), but even that doesn’t seem to impact as much as one might like.

    Your mentality is your greatest determining factor in just about anything including money matters. I think people have such a hard time changing that and becoming optimistic because money issues seem so immediate and optimism is so not now, especially if you’re one of those who has trouble paying for essential needs. People breaking the magical $40k mark on the other hand, tend to see those above them, typically baby boomers, who are the “successful” people in their world, and they see workaholics who chase money over family and friends (generalizing as there are exceptions). So, these very comfortable middle classers follow their models, who are also many times their parents.

    Added to that is a typical drive for better by gen X and gen Y’s taught to us by our baby boomer parents. In figuring out what better means we look to those before us, who more than likely got it wrong, which is why they taught us to be different. Striving for better is great, but often misguided. Figuring out how to give a better direction starts with this post on optimism.

  10. Having Issues With Your Strawman
    Having Issues With Your Strawman says:

    Penelope,you are once again affirming your own choices to the detriment of fairness or reality.

  11. Robert Ryan
    Robert Ryan says:

    Financial freedom means being free from having to work. Your income from Assets cover your expenses. Some people are lucking in they find a job they love. But alot of people out there don’t want a boss to tell them when to come in and leave and what time to eat. This is where the term financial freedom comes. I love psychology but I don’t want to be a psychologist. I love buddhism, but I do don’t want to be a monk and have my entire life dictated to me in a monastary. Basically financial freedom means I don’t have to work. I can work on my own if I chose. That’s it, it’s not complicated. It does not mean you are rich.

    * * * * * *

    Hi, Robert. 

    Thanks for the comment.  I understand what you’re saying.

    What I am trying to say here is that instead thinking in terms of black and white (earning a ton of money or buddhism) you could think of something in between — maybe working 30 hours a week and doing buddhism at night. In this way, you are getting what you want now, instead of setting up a work-hard-to-benefit-later situation.


  12. JoJo
    JoJo says:

    I think I understand where you are coming from – I experienced a similar ‘Eureka!’ moment when I read ‘Die Broke’ for the first time.

    Based on my genetics and family history, I will probably live to be 90 years old. I am now 37, which means that in addition to paying hefty Social Security taxes for current retirees, I am almost guaranteed not to get those benefits myself. If I had the idea I was going to spend the last 30 years of my life not working, and furthermore actually be able to do FUN things during those last 30 years, I’d pretty much be wasting my life right now, working my butt off to try and save up the massive fortune that would require.

    But I gave up on the idea, and it was a tremendous relief! I quit worrying about saving up so much money for my old age, and although I do live without debt, I am spending my money now and enjoying life – right now. As long as I am willing to live within my means and do something (at least part-time) to earn a paycheck throughout my life, I can relax.

  13. Maj
    Maj says:

    I had cancer and now I’m living with huge medical bills for the rest of my life!

    My “good” medical coverage doesn’t come close to covering my bills!

    My New Husband didn’t realize ( I was just into remission so I didn’t realize the lifetime expense) marrying me meant on HIS CREDIT RATING!!!!!!!

    My advice is I would have never married him if I knew what my CANCER BILLS would do to his credit rating!

  14. BobSmith
    BobSmith says:

    This is very weak thinking that is based upon two false premises:

    1. “…the idea of "financial freedom" means freedom from having to do a job you don't like. But this thinking comes from the baby boomers who felt compelled to climb ladders doing jobs that destroyed their personal life.”

    2. “Today you can hold out to get a job you love at the beginning of your career.”

    Nonsense. The entire article is based on two assumptions that were created out of thin air. Both are sweeping, false generalizations without any basis whatsoever. Both are remarkably simplistic and naive, and the second is downright pollyannaish.

    I achieved financial freedom at a relatively young age (51). I can assure you that it has been an incredibly positive, life-changing experience. And you can get there without “destroying your personal life”. In fact, the steps one takes to get there generally IMPROVE one’s personal life. And you can get there while working in a very meaningful, average paying job that contributes to society, and without any need to “climb ladders”. I know, because that’s what I did. And the people I know who have achieved financial freedom are among the most highly optimistic people I have ever seen! That’s why they were able to achieve financial freedom.

    The person who wrote this article wouldn’t know any of this, of course, because she hasn’t achieved financial freedom (which certainly doesn’t stop her from claiming to have expertise on the subject). But if you want to learn something about financial freedom, ask someone who has done it.

    Bottom line: Don’t believe a word of this nonsense about financial freedom being outdated or undesirable – or that “optimism” is somehow a replacement for freedom. It is a real contradiction to declare that “optimism” will somehow enable one to embrace the specter of dying at one’s desk. What is being peddled as “optimism” is actually defeatism and negativity.

    There is an incredible world out there for those who have the time to embrace it. Take it from someone who is living it… never underestimate the desirability of financial freedom.

  15. BD
    BD says:

    Re: optimism, financial freedom, etc.

    You overlooked the possibility that one can be optimistic, financially independent, AND have no personal life. Workaholics of the world, unite!

  16. kerry
    kerry says:

    Financial freedom to me is to be able to have what I have in my life now, knowing my financial future is secure through proper PLANNING. The icing on the cake is if I have the means to help others and actually do so. I always want to work at something that I enjoy. If I didnt have to work to have the above, I might still work anyway. That is what makes me happy. If I have even more riches I simply could give more to others seeing as Iam allready happy. Yes I do know that giving to others does not have to involve money. Its just that some people are in a position of needing more money so they can have a reasonable amount of the basic physical comforts. food, shelter,transportation ,insurance etc

  17. kevin
    kevin says:

    Brilliant review, Is there any true way to financial freedom? Well I’ve been doing affiliate marketing for some time now and have also done a couple of good reviews like the CB-Cash System and more recently the Resellers-Heaven Review Feel free to drop me a comment on any of my blogs for quick approval and I will comment on your blog as well. If you have any tips for quick SEO rankings with google please email me. As I said before Great post! I'll subscribe right now with my feedreader software! Keep the blog updated and keep up the good work. Cheers

  18. smith
    smith says:

    you’ve got a great blog, very informative and the advice is absolutely spot on. That ray is mesmorizing, I love it. Good layout too, great work.

  19. John
    John says:

    Interesting blog, but what is touted as ‘brazen’ here is in actual fact deep-rooted conservatism and morality. When the author writes about the limitations of money on personal lives she is really writing about greed, which is what our society is brainwashed into simply because it generates big profits for capitalism and empties our wallets, thus continuing the cycle of wanting more. We already know this. Saying that financial freedom is outdated, however, is hopelessly naive. As we get older and our health may potentially affect our ability to enjoy a comfortable retirement, our income is a necessity. Positive thinking won’t pay our bills or feed us. Money gives us more options in life, whether we like to admit it or not, and the quality of life we live has a direct relation to our environment and career. Chasing money aggressively may be foolish, but it is the gap between rich and poor that people are trying to fill in for themselves to achieve a more free life.

    As for monogamy and sex, this is subconscious preaching. Infidelity and divorce are two words society seems to hide from couples wishing to marry, yet as we all know they continue to happen. This argument seems to hint of ‘just shut up and stop being so greedy and love your spouse and we’ll all get along better’. I suspect the author was a pampered young woman who is now trying to set society straight with her enlightened moral views. Sex is good anytime, for anyone: either single, married, or divorced!

    The religious-like convictions of websites and self-help books on optimism that fill bookstores are a multi-billion dollar industry that few actually benefit from. The idea of thinking positive as a sole necessity to actual happiness is misleading. Adversity and critical thinking teach us more than hope or faith ever will. Learning and taking risks in life, while making mistakes along the way to significant achievements, are what bring real freedom and joy to life. Happiness is to be earned.

  20. Paula
    Paula says:

    Money solves or ameliorates big problems as well, Penelope, and you may not realize how privileged you are not to realize it: *not* “Can I have a big wedding?”, but “Can I move into a larger apartment that’s not next to a crackhouse after getting married?” *Not* “Can take a trip in my own Lear jet,” but “Can I afford to take off work long enough to take a trip?” (Good point that where you’re going and whom you see are more important.) And what you’ve missed here is that for many “financial freedom” is defined not by *wants* not being curtailed by what can be afforded, but by what many would see as *needs*… such as your ability to take your child to professionals to care for his autism, or my ability to go to the dentist (I have serious dental issues were made much worse during years when I and my parents could not quite afford adequate care.) Since bloggers are people rich in either spare time or money–either they own their own computer or have time to access someone else’s–their/your/our idea of “financial freedom” is several steps above the FF aspirations of most people, who are interested in freedom from crushing debt, and freedom to live in relative health and comfort.

  21. Green Stickman
    Green Stickman says:

    The term “financial freedom” is misquoted by many people. Thinking that they can have wealth in an instant!

    Anyways, this is a great article. I myself by the way is writing articles about financial freedom. If you may allow, I am posting a link (you can remove it if it is not ok with you):

    This article is all about our "Allies to Financial Freedom".
    These allies are time, compound interest and leverage.

    For me, it is not bad to be financially literate. The problem with others (specifically those who sell books about financial freedom)exaggerates everything.

    Thank you in advance! I hope you will allow my post. More power to your site.

  22. judy lh
    judy lh says:

    Hello Penelope- I was terminated from my last joob- please help with how to interview and turning into a positive experience- thanks

  23. Charlie
    Charlie says:

    Hi Penelope:

    You are right in that money should not determine happiness.  I feel sorry for those people.

    I heard the following story from a tax attorney that made me go “hmmmmm” and would like your take on it.

    The tax attorney is busy from the time he gets up to the time he goes to bed.  Planning, going to meetings, etc.  He became an attorney probably b/c he was interested in helping others and because it was an admiral career.

    He then asked himself that he one day would like to have his finances all squared away and enough to afford him a lifestyle that gave him lots of time to spend with family and friends.

    He then saw a homeless person with all the time in the world, talking to his “buddies.”  They were only concerned about the basics, i.e. eating, bathing, sleeping but with so “little” to worry about, they had a LOT of time.

    Now, I define financial freedom as when all your bills can be paid with passive income so that you HAVE the time to spend with family and friends.

    So, I think the problem is how much does one need (in expenses) in order to be happy, which is what we all want to be, right?  So, we do need money to fulfill happiness.  

    Do you think that if that homeless person was optimistic about life, would you consider him wealthy?

    Like I said, it made me go “hmmmmmm” when the lawyer pointed out that the homeless have all the time.

    Love to hear your take on what wealthy means.


  24. Yuse Lajiminmuhip
    Yuse Lajiminmuhip says:

    Finally someone else who doesn’t bash others for being optimistic! Seemed like everyone in college were pessimists disguised as realists with the sole purpose in life to say “no.” I’m happy being an optimist. I sometimes bury myself in dreams of a better future, but its those dreams that drive me to act on today. I wonder what drives them?

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