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Mustard Seed Money

Mustard Seed Money

How Do You Measure Financial Success?

June 18, 2018

THIS POST MAY CONTAIN AFFILIATE LINKS. PLEASE READ MY DISCLOSURE FOR MORE INFO.

 

How Do You Measure Financial Success?I recently finished the amazing book, American Kingpin: The Epic Hunt for the Criminal Mastermind Behind the Silk Road by Nick Bilton.  If you’re not familiar with the story, it gives a behind-the-scenes look at the rise and fall of Ross Ulbricht, the founder of the Silk Road. The Silk Road is an online black marketplace, best known as being a platform for selling illegal drugs on the dark web.  To say that this book was fascinating is an understatement. I honestly couldn’t put it down.

 

If you’re into stories about 20-somethings trying to change the world, murder for hire with the Hells Angels, running into corrupt government officials while using Bitcoin before it became mainstream, you’ll be thrilled.  This book has it all.

 

One of the most interesting aspects about Ross Ulbricht was his disappointment on where he was in life.  He was PhD dropout.  Although he had a brilliant mind, he was incredibly discontent that he wasn’t doing something more with his life.  The crazy part of all of this was he wasn’t even motivated by money.  He just wanted to be able to make a lot of money if he wanted to.

 

He was reticent to talk about money in front of his friends and family, since he was so embarrassed about his financial situation in life.  This got me thinking about how I measure financial success.

 

Whether or not we realize it, we all have a certain measuring stick to determine financial success.  It may be criteria based on the influence of friends or family or even celebrities in Hollywood. Whatever or whoever sets them, we each have a standard.

 

Today, I thought I would highlight four common ways that people measure financial success.

 

Comparing Against Your Friends

For Ross Ulbricht, his measure of financial success was to compare himself to his friends from high school.  He was constantly thinking about how inadequate he was running a small-time, non-profit bookstore in comparison to his friends, whose jobs made him jealous.

 

Ross thought that he was a uniquely gifted individual.  He couldn’t understand why he was having such a difficult time transitioning from college into the real world.  He had trouble adapting his book knowledge into the workplace, which haunted him in the end.

 

I actually don’t find myself comparing myself to my friends very often.  A couple of friends of mine are doing really well financially. I’m honestly incredibly happy for them, although, I might feel differently if I was toiling in a job and struggling financially.  All that to say, I am incredibly grateful for where I am.

 

Related:  When Gratitude Requires Hindsight

 

Comparing Against Your Peers At Work

Admittedly, there are times when I have hints of jealousy measuring my financial success compared to my peers at work.  Working for the government, I do love serving my country and am passionate about the work that I do. However, some of the contractors that I work with make double or even triple what I do.  They drive very nice cars to work and go home to mega mansions that line the DC area.

 

My boss likes to joke around and say that we must really love the work that we do because when we put on our government badges at work, we take a vow of poverty.  It’s clearly not our paychecks that motivate us to show up to work each and everyday.  

 

Related:  How I Became a Millionaire While Working For The Government

 

Comparing Against Your Family

Whether conscious or not, most of us probably compare ourselves to our siblings and parents to see if we are keeping up with their progression in life.  For instance, my sister is an amazing artist.  She has more talent in her pinky finger than I’ll ever have.  But, I’ve never really felt jealous of her financial successes.

 

However, recently, I have been looking at where my parents were on their financial journey when they were my age.  I end up shaking my head at how housing prices have exploded since then.

 

My wife and I grew up seven houses down from each other in the DC suburbs.  We recently saw my former home go up for sale on Redfin.  It was nostalgic to look through the pictures of the house and all the changes that the homeowner had made.  But then I became depressed knowing that there was no way that I could afford the house, even if I wanted to.  

 

Looking at where my parents were at my age, I feel a pang of guilt knowing that I may not be setting my children to have a better life than the one I grew up with.  

 

Related:  Living Near Family…Is It Important?

 

Comparing Against Your Own Financial Goals

If I’m being honest with myself, this is the only one of these four that should actually matter.  The only person I should be trying to measure my financial success against is me. I have the ability to decide what financial goals I want to set and what financial goals are unrealistic, based on the decisions I make.  

 

As a quick reminder, I love using Personal Capital to create my financial goals to see how I am progressing against those goals.  If you haven’t signed up, I encourage you to sign up today.

 

I like working for the government.  I’m not interested in taking a contractor position, even if it does make double or triple what I make. On top of that, the housing market is completely different from when I was a child.  Comparing myself to my parents and what they accomplished shouldn’t denigrate from the financial successes that I’ve had over the years.

 

While I think it’s important to monitor your financial success so that you aren’t spending too much time on your laurels, I believe that you should skip the first three ways and concentrate exclusively on the one you actually control.  

 

Related:  My 2018 Goals: Stretching Myself

 

So readers, did I miss any additional ways to measure financial success?  Have you fallen in the trap of any of the above? Share your thoughts below.

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11 Comments

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Comments

  1. Lily | The Frugal Gene says

    June 18, 2018 at 5:06 am

    “The crazy part of all of this was he wasn’t even motivated by money. He just wanted to be able to make a lot of money if he wanted to.”
    Aha is that crazy? I was about to say that is 100% me haha.

    I have a bad problem of “New target acquired…I have to match them!” It’s not towards 1-4 since we don’t know that many people’s finanical detail. Its my own blend of goals like this CEO so and so had done this much by this age…so in order to keep up I need to do this etc. I guess I’m comparing to people on the internet…as sad as that sounds :)!
    Lily | The Frugal Gene recently posted…A Very ‘Meh’ 2nd Goody Box – ThredUP Review 🛍️My Profile

    Reply
    • Mustard Seed Money says

      June 20, 2018 at 5:04 pm

      I didn’t even consider the celebrity aspect of things. That’s a great point. So and so is at this point in life…I should have something similar 🙂 Thanks for sharing!!!

      Reply
  2. Gary @ Super Saving Tips says

    June 18, 2018 at 11:57 am

    American Kingpin sounds really interesting…I’ll have to check it out!

    As for financial success, like Teddy Roosevelt said, “Comparison is the thief of joy.” I try not to compare my own financial situation to others, although it’s only natural to do so once in a while. Then I have to remind myself that our circumstances aren’t the same as theirs, and I’m fortunate to have what I have. Another comparison is to compare your income or wealth against the rest of the world using a tool like http://www.globalrichlist.com/. That can really put things into perspective.

    But I have to agree with you, comparison against your financial goals is truly the only comparison worth making.
    Gary @ Super Saving Tips recently posted…How This Fed Rate Hike Will Hit Your WalletMy Profile

    Reply
    • Mustard Seed Money says

      June 20, 2018 at 5:12 pm

      You will love the book. It was amazing and definitely won’t be disappointed.

      Reply
  3. FullTimeFinance says

    June 18, 2018 at 12:29 pm

    ‘Comparison is the theif of joy’. The only problem is comparison is a base part of human nature. I try to compare myself to average as I feel I can’t stop myself from comparing but that’s a relatively easy hurdle to clear given how many folks don’t try. Beyond that I obviously compare to my goals.
    FullTimeFinance recently posted…The Power and Benefits of Risk TakingMy Profile

    Reply
    • Mustard Seed Money says

      June 20, 2018 at 5:13 pm

      I hear ya!!! The average feels like a better goal to have than some 1% out there 🙂

      Reply
  4. Simple Money Man says

    June 18, 2018 at 4:50 pm

    I agree that it’s human nature to compare. Instead of negative, it can be used as motivation. At the same time, it’s important to take a step back and assess what your overall objectives are in the pursuit of financial happiness.

    Yes I’ve fallen in the trap of these, but quickly realized that no matter where I end up financially, they’ll always be someone with a stronger position and that’s ok because they’ll find one too too and so on.
    Simple Money Man recently posted…What Makes Personal Finance Exciting?My Profile

    Reply
    • Mustard Seed Money says

      June 20, 2018 at 5:16 pm

      I’m right there with you!!! Nobody where you are there is always someone out there do a little bit better, or making faster progress 🙂

      Reply
  5. Simon | Vistafolio.com says

    June 19, 2018 at 5:47 pm

    The true measure of financial success should be financial independence. If you lose your job, how long can you keep going for? If the answer is forever – you’ve achieved financial independence and freedom. It doesn’t matter what others have. Your freedom and your family’s freedom is what counts. This can be achieved with some smart financial planning. Invest in growth assets like stocks in good companies. Get the timing and the mix right, be prepared to ride out some short term troughs, and it will happen over time.

    Reply
    • Mustard Seed Money says

      June 20, 2018 at 5:35 pm

      Great points Simon!!! If you have enough money to ride out some of the short term problems, you will be financially set 🙂

      Reply
  6. Karan Sharma says

    August 30, 2018 at 3:13 am

    The percentage of income you’re setting aside for retirement can vary, but most financial experts say at the very least you should be putting away 10%.

    Reply

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