I have a funny relationship with money.
Namely, I dread it.
Whenever I have to consider anything financially-related, it ignites a swirl of fear, anxiety and claustrophobia.
It just feels too much.
When I started thinking about how to make a 12-month break possible, money was a necessary part of the equation.
I immediately shrivelled up.
There was no way I could afford this break. No way!
After weeks of feeling stuck, I decided to summarise the fears into actionable questions.
These were the three questions:
- How will I know I’m saving up enough?
- Will I be harming my future self?
- What are the opportunity costs of this one year?
I then pulled out excel and did my best guesstimates.
1. How will I know I’m saving up enough?
Using the app Goodbudget, I tracked my ins and outs obsessively for 2 months to understand my daily spending habits not just at home, but also when I was on holiday.
I also looked at past bank statements to make sure I captured all monthly and annual payments.
These were classified as “can do without”, “good to have” and “essential”.
Eventually, I came up with a number that I was 85% confident was “more than enough” as a monthly living budget.
I also included an ‘emergency fund’ (3 months worth) and an ‘education fund’ for taking up any courses along the way.
All that together became my savings goal.
Once I had that concrete number down, it was a huge relief.
Even though it was still big and scary, I had SOMETHING I could work towards.
(I’ll write a more detailed post on my savings approach later!)
2. Will I be harming my future self?
I am constantly worrying about my future self having enough money.
- I don’t even have any plans to have kids anytime soon, but will Mama Sonia be able to send Baby Sonia to school?
- Will Baby Sonia be able to go to university?!
- Would not earning for a year deprive Baby Sonia of an education!?!?!
HOLY CRAP. WHAT A FAILURE OF A MOTHER.
AND WHAT ABOUT RETIREMENT?!
I felt crushed by the weight of future financial commitments.
This honestly was a very difficult one for me to overcome.
I’m still worried, but the best compromise I’ve come up with is making sure none of my currently invested money is impacted.
That would serve the needs of future Sonia and her potential offspring.
3. What are the opportunity costs of this one year?
I left Skyscanner at a time when I was performing well, had great benefits and would have received a bonus in the second half of 2020.
Initially, this held me back a lot.
“I’m leaving walking away from so much money!”, I fretted. “Is this 12 months really worth it?”
However, in conversation with a friend, I realised that the amount wasn’t more significant than if I signed up for an MBA.
This is, after all, a year centered on learning, where I’ll be designing my own curriculum.
I’ve found this perspective very helpful.
- As professor, how would I want to design my classes to deliver maximum value with least effort?
- As student, what homework would I want to submit to put what I’m learning into practice?
Thinking about the opportunity costs, initially a blocker, has instead made me really take responsibility for my time.
Breaking it down this way helped me see that my initial fears, although trying to protect me, were also blocking me.
And most of all, they were manageable.
Still big, still scary, but manageable in the grand scheme of things.
I can do this!
What are some of your own fears about money?