Stacy Johnson - Life or Debt 2010: A New Path to Financial Freedom

LIFE OR
DEBT 2010

LIFE OR
DEBT 2010

A New Path to Financial Freedom

STACY W. JOHNSON, CPA

Introduction
Will the Circle Be Unbroken?

Pocket Books
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Copyright 2010 by Stacy Johnson

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First Pocket Books trade paperback edition January 2010

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Library of Congress Cataloging-in-Publication Data

Johnson, Stacy.
Life or debt 2010 : a new path to financial freedom / by Stacy W. Johnson.
p. cm.
Rev. ed. of: Life or debt. 2002.
1. Finance, Personal. 2. Consumer credit. 3. Investments. I. Johnson,
Stacy. Life or debt. II. Title.
HG179.J558 2010
332.024dc22
2009042467

ISBN 978-1-4391-6860-8
ISBN 978-1-4391-6861-5 (ebook)

While its true that we come into this world alone and leave it alone, practically everything else we do of any significance involves the assistance, cooperation, and/or indulgence of other people. Thats certainly true of this book. Much of what went into Life or Debt came from my own thoughts and observations, but often I confirmed those thoughts by talking to people who were experts at this stuff. That includes myriad people who devote their lives to helping people overcome debt dilemmas, like the fine folks at Consumer Credit Counseling Service and other such organizations. You know who you are.

I also learned a lot from reading other books. One I quote directly and acknowledge in Life or Debt is The Millionaire Next Door. But there are many other books that directly or indirectly influenced me in less specific ways. One Id like to both mention and recommend that you read is Your Money or Your Life by Joe Dominguez and Vicki Robin.

You wouldnt be reading this right now if it werent for the untiring efforts of my agent Liza Dawson and my good friend at Simon & Schuster Anthony Ziccardi.

When I first wrote Life or Debt nearly ten years ago, I dedicated it to my parents, Stacy and Betty Johnson. Theyre both in heaven now. So this time out, its dedicated to all the people in my life who provide me with emotional support, make me laugh out loud, and dont let me take myself too seriously no matter how hard I try. The list is long, but it most certainly includes my fabulous girlfriend, Sara Steinman; my sister Sue Davis; Angela Puckett and her boy Chris; my cousin Nancy; my coworkers Dan Schomtuch and Jim Robinson; and my many pals, including Greg Wager, Lee Karsh, and two of the most wonderful people on the planet, Fred and Jayne Shaffer.

To be clever enough to get all the money, one must be stupid enough to want it.

GILBERT K. CHESTERTON

Ive really had a riot writing this book. I hope youve enjoyed reading it, but what I hope even more is that you can use it to not only erase the debt in your life but to wake up to a world of your own design, where you find your own unique version of happiness and fulfillment. Because when its all said and done thats what life is all about.

If you want to be happy and free, then embrace the concepts you already knew before you began this book. The first is that once your basic survival needs are taken care of, there is an inverse relationship between physical possessions and happiness. If youre not happy, no amount of money or things is going to take you there. In fact, just the opposite is true. Happiness and physical possessions sit at opposite ends of the seesaw. Billions of dollars are being spent in advertising every year to convince us that happiness is connected to physical possessions, but its all a lie. Accumulating stuff provides misery, not happiness. The more physical possessions you have, the less happy youre going to be, even if you can afford them all. Why? Because managing possessions is stressful and time-consuming, and collecting stuff is addictive. Once you have a physical possession, you automatically develop expectations around that possession. And the more expectations you have, the more opportunities you have for disappointment. Take cell phones, for example. Before they were invented, you didnt have any expectation that you could talk on the phone anytime, anyplace. Now you do. So you buy a cell phone, which gives you a whole list of brand-new expectations. You expect it to work, which it frequently doesnt, and that causes you stress. You expect it to be the best available technology, which it isnt, because a week after you purchased it somebody invented a phone that has even more gizmos. You expect to pay a reasonable price for service, which you dont because of all the hidden fees and extras youre talked into buying. So to deal with the stress of not having your expectations met, you buy a new phone. But that doesnt alleviate your stress; it just starts a brand-new cycle. This is true of every physical possession you have: computers, TVs, telephones, cars, stereos, appliances, your house, etc., etc., etc. Each possession comes complete with its own unique stress cycle and each puts peace of mind farther away. Does that mean you should never own modern conveniences? Of course not. But it does mean that you should recognize that after youve satisfied your basic physical needs for food, clothing, and shelter, everything you buy will probably make happiness harder to come by. And when you boil it down, thats simply because your ability to be satisfied is inversely proportional to your expectations.

Sailing is one of my favorite things to do, and its my goal that in the not-too-distant future, Ill be doing it more or less full-time. I love the idea of sailing because it involves harnessing the earths natural energy (wind) to literally move your house around the world. You can go where you want when you want, and stay for as long as you want. Your life can be very simple while at the same time being a major adventure. You can be alone, or you can socialize with some of the most interesting people our planet has to offer.

You may think that sailing sounds stupid, but lets assume for a minute that youre hip to my drift and Ive convinced you that sailing is something you want to do also. Start asking around about sailing and one of the first things youll hear is that sailing is a very expensive thing. Is this true? Yes, provided you buy into the reality that boating involves basically duplicating your land-based home and putting it on the water. When thats the reality you live in, to live on a sailboat is going to require you to be very rich indeed. Because having a boat big enough and fancy enough to include a washer/dryer, refrigerator/freezer, generator, TV, air conditioner, sophisticated navigation and communication equipment, etc., can cost a fortune to buy. And once you buy it, you have to pay docking fees and then you have to pay lots of money to keep all these systems in good repair. Just buying a new 50-foot sailboat with all the bells and whistles could easily set you back a million dollars, and thats just the start of your expenses. So if you want to be a sailor, you could save up your entire life and never get the money together to do it. So much for that dream of freedom!