Nico Appel

personal blog

Last seen in: Berlin, Germany
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The Millionaire’s fallacy

Here is a quote that I took from the book notes to “The Millionaire Fastlane” by

Being wealthy means being healthy, being surrounded by great friends and family, and the freedom to live life how you want to live it. DeMarco calls these the 3 Fs (family, fitness, freedom)

So, what’s the relationship between being wealthy (as defined above) and money?

What money does for you

Although it is certainly true that poverty (as the opposite of wealth) may limit your choices in some aspects, it isn’t necessarily the case that money creates, enables, or leads to personal freedom. I would go even further and say, it might be the other way around: personal freedom often times “helps” people to become wealthy.

I am aware that a lot of people think that having money or being wealthy (yes, I know they are not exactly the same) increases freedom. But what kind of freedom are we talking about here? The thing is: If “Being wealthy means being healthy, being surrounded by great friends and family, and the freedom to live life how you want to live it”, then what has any of that to do with the acquisition of money and material goods?

Can health be bought? Not really. Think of Steve Jobs who died of cancer with the best medical assistance around.

Family and friends? Money might get you some people who want to hang out with you, but they are not your friends, are they?

Freedom is what got me thinking in the first place. Here is my current experience: I am about as free as I actually do what I say (or think) I want. I am free to eat healthy and exercise for example in the sense that I have everything I need to do so. I might not be free in the sense that I may lack discipline and habits or that I am addicted to junk food. Money is not going to help me make better decisions or stick to them.

Getting back to the quote from the beginning, it says “… the freedom to live life how you want to live it”.

Freedom is …

Let’s dive into freedom for a bit. There are all kinds of freedom:

And then you also have to ask an expert on the subject of the idea of freedom, in this case, Immanuel Kant. He mentions

the practical concept of freedom as the independence of our will from the ‘coercion’ or ‘necessitation through sensuous impulses’

Let that sit for a second. The DeMarco quote reads “freedom to live life how you want to live it”. So, next question …

What do you want?

A question most people can not answer adequately – for various reasons. But let’s say you can answer this for yourself, how often is it actually the case that a lack of money / wealth is what’s holding you back? My point here is this: Freedom does not come with wealth. Neither does the ability to do what you want. Both, apparently, need to be earned in some way. To illustrate my point, let’s just say you would have all the resources, won the “lottery ticket”, then …

Don’t be Beavis and Butt-head

In one episode of the animation series former President Clinton comes visiting Beavis and Butt-head’s high school. In preparation for the event the principal and the teachers decide to pre-emptively get rid of Beavis and Butt-head to avoid chaos. The principal hands them a pass as well as some cash. The pass allows the two boys to

… go anywhere and do anything.

After leaving the principal’s office with the pass and the money Beavis and Butt-head are very excited about the unexpected gifts. Here is that special moment:

As they are thinking about where they could go and what they could do, nothing but empty thought bubbles emerge above their heads for a few seconds: They can’t come up with anything.

These are the boys thoughts on what to do as they can go anywhere and do anything.

These are the boys’ thoughts when considering where to go and what to do without restrictions.

The marketing of being a millionaire

Look, there are a lot of nice goodies waiting for the millionaire, the wealthy, the rich. I don’t doubt that. All I’m saying is that the marketing of being a millionaire tends to be a bit lopsided and most people just nod their heads and agree.

Look at the 3 Fs from the quote and ask yourself if they are really dependent on money or even becoming a millionaire. I would argue that the 3 Fs are a good concept but have little to do or are in need of money or you becoming a millionaire. People who write books about how to make money (or how they made money themselves) seem to get away too often by adding two points:

  1. The fact that money does not equal wealth (saying that makes them look smart because a lot of people have not made that distinction yet).
  2. A statement that wealth is not just money and assets. (They add some pseudo-holism here by mentioning family, friends, fitness and freedom. It’s the “I’m not only talking about money here” – statement.

They rarely talk about the real obstacles because the world is too complex for a little book and it also wouldn’t sell well. For the folks who are making an effort to think independently, I suggest looking a bit deeper and to avoid getting bedazzled by the shiny objects.

Note: I would welcome any feedback and thoughts on this as I had a hard time clarifying the point that was triggering my first gut response. If you have any suggestions or corrections, please email me.