Normally, I really hate books about money.
Sure, they teach you how to invest, how to go by with less, how to save for retirement, and all that. But here’s the problem: These are band-aid solutions. They might butter up your financial situation, but neglect far more critical, underlying questions:
- How much money do I actually need?
- What’s a healthy relationship with money?
- How can I escape the treadmill of always trying to make more money?
Luckily, I found some intriguing answers when I stumbled upon John Armstrong’s How to Worry Less About Money.
What’s ‘How to Worry Less About Money’ About?
This thoughtful guide isn’t a cringe-inducing treasure map to making six figures a year. (Sorry to disappoint you.) It also doesn’t tell you how to make more money or how to invest.
Instead, the book teaches you how to think about money in a constructive, philosophical way. It asks practical questions to scrutinize your relationship with money. Explains the link between money and the good life.
As we’ll see, knowing how to control money worries is far more useful than knowing how to control money.
Here are the five most valuable lessons from How to Worry Less About Money. They forever changed the way I view money.
1. Why Money Stresses Us Out
There are two reasons why money makes our lives so difficult:
- Money troubles
- Money worries
Sounds confusing? Here’s the difference:
Money troubles are harsh and urgent. It’s when your car unexpectedly breaks down and you don’t have enough money to repair it. When you can’t replace your worn-out clothes. When you can’t get enough food on the table.
Money worries are a completely different story.
They don’t reflect the struggles of reality. They’re personal and completely made up. Billionaires have no money troubles. But their money worries can be as intense as those of a bankrupt gambler (and they probably are). As Armstrong puts it:
“Worries are about what is going on in your head, not just what is going on in your bank account.”
Unfortunately, our culture fixates on advice for money troubles. This is a huge problem. Because money is about much more than paying your monthly bills. It’s also about things like power, status, freedom, and work.
And so, “make as much money as you possibly can” is dangerous advice. Most of the people who go down this path have long solved their money troubles, but continue to create all-consuming money worries.
“The question ‘how can I get more money?’ should, ideally, be asked only after enquiry into how much money I need and what I need it for.”— John Armstrong, How to Worry Less About Money
Put differently: We need to answer the “why” of money before we can pursue the “how.”
2. How Much Money You Actually Need
The way most of us worry isn’t exactly productive. And not just money-wise. We worry about worries. We get anxious about being anxious.
As a freelancer, it’s particularly stressful. Whenever I see that my expected monthly earnings are below average, my mind tips off a sequence of worries like dominos:
I’m not making enough money → I need to work more → I’m not productive enough → Am getting burnt out? → I’m not feeling inspired anymore → I can’t do this → I’ll never make enough money → I’ll land on the street.
As you can see, my thoughts completely detach themselves from reality. And just like that, I turned a single spark of worry into a bonfire of despair.
The solution Armstrong presents in How to Worry Less About Money is to identify the worry, ask the right questions, and arrive at an insightful answer. Here’s how:
Four questions for reducing money worries
The great thing is that almost all worries fall into bigger categories. And so, Armstrong suggests that we only need four questions to reduce our worries:
- “What do I need money for? That is, what is important to me?”
- “How much money do I need to do that?”
- “What is the best way for me to get that money?”
- “What are my economic responsibilities to other people?”
I can only encourage you to carve out about an hour of your day and do this exercise. Just for yourself. Without distractions. If you can’t give 100% accurate answers right now, that’s fine. Take your best guess.
When I did this exercise, it felt like a fresh shower washed away the muddy money worries in my mind. And honestly, I was shocked. I didn’t hold back with all my money calculations and even included monthly savings. But the final number my calculator spit out was still way below what I expected.
A good life requires less money than most of us like to believe.
Whenever I worry about money, I return to this exercise. It’s a balm of calm.
3. The Secret Meaning of Money
“[D]eep down, very often money is not money. It is proof of goodness; it is the cause of evil; it is victory over a rival; it is the path to love; it is guarantor of sexual pleasure; it is poison; it is the death of childhood.”— John Armstrong, How to Worry Less About Money
What is money besides a number in your bank account? It’s a means of exchange, sure. Money can store value. It can turn into lots of cool stuff at almost any time. But what does that mean for our relationship with money?
The book points out three ways in which money affects our quality of life:
- How we turn money into other things — like possessions and experiences.
- How we turn work into money.
- And how the two interact.
Now, this next point completely blew my mind.
How to avoid an unhealthy relationship with money
“Our relationship with money becomes unhealthy,” Armstrong writes, “when we remove it from this cycle.” Knowing this, it’s easy to see where our biggest money worries come from:
- Your efforts don’t feel worthwhile. The work you put in is greater than what you get out of it.
- You struggle with turning money into meaningful possessions and experiences.
- Or you combat a combination of the two.
Here’s an example:
Let’s say you buy a house. Many people would see this as an investment. And that’s fair enough. Money turns into bricks, mortar, glass, and steel. And someday, you can transform the house back into money.
The problem? Money is always the primary consideration. And thus, a source of stress. Weather disasters are unpredictable. Prices rise and drop. Bubbles burst.
The result? House worries become money worries. You detached your investment from the money cycle. And, thus, you’ll feel like it doesn’t add value to your life.
Luckily, that’s not the only way to think about it. Houses are more than real estate. They’re also places to call home. To make memories. Invite friends for dinner. Raise children. Express creativity.
Our relationship with money becomes healthy when we stop treating everything we buy as materialized money. And instead, start making meaningful purchases with worthwhile effort.
In other words: Buy a home, not real estate.
4. The Ultimate Goal of Money
Obviously, one goal of having money is survival. But what happens once we covered our most basic needs? Why are we so desperate to keep making more and more money?
Here are two common answers:
- We want more money in the hopes of leading a happier life.
- We want more money to feel better about ourselves.
What does Armstrong say about that?
“[M]oney can purchase the symbols but not the causes of serenity and buoyancy. In a straightforward way we must agree that money cannot buy happiness.”
And, in fact, research confirms that there’s a “saturation effect.” The more money we earn, the less it contributes to our well-being. So clearly, we should reconsider our money goals. But how?
This brings us to one of my favorite ideas from the book.
Money as an ingredient for flourishing
To flourish in life means reaching our fullest potential. Making the best use of our time and abilities. Money alone can’t help with that. But most things in life are insanely difficult without money.
For example, money doesn’t make you a better piano player. But you can use it to buy lessons, music books, and a grand piano.
In this sense, money can act as an ingredient for action. It’s an enabler for possessions, power, and influence. And in contrast to happiness, the return of flourishing and money is limitless.
This doesn’t imply you should try to earn as much money as possible. Again, it’s crucial to know why you need money. Only then can you answer how much money you need. Here are some aspects to consider:
- What are my real objectives? (This could be a nice home, getting better at a skill, or creating a better life for the people around you.)
- What (apart from money) is important for attaining these things?
- What does money contribute?
To fully grasp this concept, let’s look at one last lesson from the book. It might be the most important one.
5. These Are Your True Needs
By now, it should be clear that your needs play a crucial role in your money worries. But what are needs anyway?
The problem is that we often confuse our true needs with wants or desires. For example, we might fall into the trap of modesty: “Oh, I shouldn’t buy this because I don’t really need it.” What we actually mean is that this particular item isn’t part of our most basic needs — food, shelter, safety, etc.
But here’s the thing:
Nobody stops needing money just because they covered their basic needs. Our true needs go deeper. They’re our basic needs plus everything that helps us flourish. A key question Armstrong points out in How to Worry Less About Money is, “How good will it be for me to have this thing in my life?”
In this sense, it might even be a bad idea to purchase something affordable and desirable. Sure, you might have enough money to upgrade your phone. But does it really help you flourish? Probably not.
Ideally, you should always define your true needs first and only then look up their price.
The Best Book About Money I Ever Read
How to Worry Less About Money is a timeless book. Its lessons are relevant whether I’m a starving artist or a NYT bestselling author. Whether the stock markets crash or skyrocket. And whether I work for the rest of my life or become financially independent.
And that makes it the best book about money I ever read.
Now, of course, I don’t want to discourage you from reading other finance books. Quite the opposite. But it’s much easier to figure out how to make money once you’ve answered the “why” and “what for.” And for that, How to Worry Less About Money is the perfect handbook.