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The 5 Building Blocks of Mindful Financial Independence

Financial independence (and specifically the Financial Independence Retire Early or FIRE movement) has been in the news quite a bit lately.

Such articles often go into breathless detail about the frugal lengths that various FIRE retirees go to in order to save money (like using a power drill to stir natural peanut butter to ensure not a single drop is wasted), making it sound like copying the subject’s penny-pinching example will allow anyone to achieve delicious, peanut-buttery financial independence.

But you can’t frugal your way to wealth, which the most forthright of the FIRE practitioners admit openly. Achieving financial independence and early retirement requires a high salary, which would seem to leave anyone who is not highly-compensated out of luck.

However, those of us not in the top-hat-and-monocle level of compensation don't have to toil at hated jobs forever. That’s because incorporating the practice of mindfulness into your financial habits can help anyone achieve mindful financial independence.

No matter the income level, you can reach this kind of financial independence. That’s because it focuses on building the life you want within the framework of what you have, rather than reaching for a difficult-to-achieve financial goal of absolute freedom.

Mindful financial independence is about ensuring that your finances do not impede your life satisfaction. You can achieve mindful financial independence even if you continue to work, because you will be free of the financial stress, headaches, and constraints that are put on you by others.

That is not to say that mindful financial independence will end your money worries forever—any more than typical financial independence would. But declaring independence from external and unnecessary financial pressures will allow you to feel a greater freedom and satisfaction in your life, no matter your current savings level, net worth, or distance to retirement.

The key to reaching this sense of mindful financial independence is through the framework of mindfulness practice.

Mindfulness for meditation and finances.

But what exactly is mindfulness practice? How can it inform your relationship with money? How will paying attention help you break free from financial pressures?

Understanding Mindfulness Practice

The promise of mindfulness is that simply noticing what you’re doing—whether that’s biting into a juicy peach or walking the dog around the block—will allow you to reap a greater sense of satisfaction in your life. This can sound like a tall order for a few self-checks. How can noticing what you’re feeling or doing improve your life?

So, let’s start with a basic understanding of what mindfulness is, as described by Dr. Jon Kabat-Zinn, in his book Coming to Our Senses:

“[Mindfulness is] moment-to-moment, non-judgmental awareness, cultivated by paying attention in a specific way, that is, in the present moment, and as non-reactively, as non-judgmentally, and openheartedly as possible.”

To break this definition down a little more, there are five building blocks of mindfulness:

1. Paying attention: This is about fully connecting with whatever is happening and gently guiding your thoughts back to it if your mind wanders or you begin to react emotionally.

2. Present moment: The past cannot be changed and the future has not yet happened, but we tend to elide right over the present in our rush to stay in the past or get to the future. Centering yourself in the present moment allows your attention to focus solely on the ways things are right now.

3. Without reaction: Human beings react to experiences and situations based on how previous, similar experiences have gone. But automatic reactions can be counterproductive, because they do not give you a chance to reflect and decide on the best course of action. Mindfulness practice encourages you to respond to experiences and situations, rather than react to them. Taking a moment to simply accept what is, without reacting, gives you the chance to think about the situation and make a considered and deliberate choice in how to respond.

4. Without judgment: It’s natural to judge your experiences as good or bad, or as something you like or dislike. The problem is that your judgments cloud your ability to see things as they are. Instead, you are focused on how things should be or how you believe you should feel about the situation. Mindfulness asks you to let go of your judgments and simply accept what is with curiosity.

Suspend judgement and accept what is

5. With open-hearted compassion: Treating yourself and your experiences with compassion and kindness allows you to not only forgive yourself and others for mistakes and errors, but it also allows you to better focus on finding solutions.

In addition, an important aspect of mindfulness practice is accepting that you are not your thoughts. You are merely the observer of the thoughts that pass through your mind. Just because you think something does not make it either true or part of who you are. This is an important distinction because we often believe everything that we think, which can lead to bad decisions and suffering.

Using these building blocks as the basis of your journey to financial independence will allow you to feel more satisfied at every step of the way, instead of putting all of your life on hold until retirement.

Let’s look at how these five building blocks will work in your financial life:

Paying Attention

In mindfulness meditation, the act of paying attention is typically rooted in your body. When you meditate, you focus on your breath going in and out, or on how your body feels in the moment. Staying connected to your body can be an important part of mindful financial practice, as well. Checking how your body feels can help you to pay better attention to your emotional state as you handle your daily money choices. These emotions are often reflected in your body, even if you are otherwise unaware of them. For instance, a feeling of panic can settle as a cold knot in your belly; stress can cause tension in your shoulders or other joints; and elation can make you flush with pleasure.

As you work toward mindful financial independence, you will learn to stop and check in on how your body is reacting to any financial stressors, decisions, or benefits. For instance, if you find you have a stomachache after you are offered a promotion with a sizeable raise, you can sit quietly and focus on the churning in your belly before you respond to the offer. Paying attention to what your body is telling you can help you to determine how you are feeling, rather than how you think you should be feeling.

Journaling as part of financial mindfulness

In addition to paying attention to how your body is feeling, journaling can also be an important part of your financial mindfulness. That’s because journaling forces you to interrupt thought patterns long enough to write them down. Once you have jotted down what you are thinking or feeling, you are much better able to examine those thoughts and feelings and recognize if they are causing you harm.

In many ways, journaling is a form of basic meditation. That’s because you can focus on the repetitive motion of writing, which can often allow you to stay in the present as you explore your thoughts and feelings. Meditation practice that asks you to focus on your breath can be challenging for anyone new to mindfulness practice, but focusing on the pleasurable sensation of writing while paying attention to the present moment is much more achievable.

Journaling offers a concrete way for you to recognize the distance between yourself and your thoughts. By capturing your thoughts in a journal, you identify the thoughts that do not reflect reality, or those that form an incorrect story you are telling yourself, or those that prompt you to make counterproductive decisions. Once you have captured these thoughts on paper, it can be very freeing to literally cross them out and rewrite them to reflect reality, embrace positivity, and let go of anger, resentment, or sadness.

Making a habit of this kind of specific attention—both checking in with your body and journaling your thoughts, emotions, and reactions to financial situations—will allow you to better understand your financial needs, wants, triggers, and stressors.

Present Moment

While all decisions offer us the temptation to focus on what could have been done differently in the past, or what will happen in the future, money choices are uniquely suited to beating ourselves up for past decisions and fantasizing about future outcomes. By torturing yourself over things you cannot change from the past, or hanging your expectations on things that have not yet occurred in the future, you are ignoring the power you have in the present moment.

Be present in the moment

You might assume that remaining in the present moment is about ignoring the past and the future. But it’s important to acknowledge that every moment in your life is connected to every other moment in your life—by you.

That’s because we contain all of our past selves—like a tree’s rings—and we are always continuously growing toward our future selves. This means that living in the present must include honoring your past and future selves, because they are with you in the present.

For instance, you might regret the amount of student debt you took on for college. Maybe you kick yourself with every payment, thinking how much better off you’d be if you had chosen a different college, degree, or lender. But regarding your past self with anger or disdain does not help your live in the present moment, nor does it feel good.

So what if you honored your past self’s choices by acknowledging everything you had access to in college because of the money you borrowed? You not only received an education, but also made friends and connections at college, had new experiences, gained insights about yourself, fell in love with your field of study, and enjoyed the freedom to focus on your studies rather than on tuition bills.

Taking the time to go through these benefits can help you feel grateful for the loans rather than resentful. You can let go of your anger and start to view your current loan payments as a gift to your younger self and an investment in a financially freer future self.

Centering your focus on the present moment can help you to release your past mistakes and give appropriate weight to future possibilities.

Without Reaction

Automatic reactions can be helpful when you experience something along the lines of “tiger attack” or “runaway baby stroller.” In both cases, the fact that you immediately run without thinking is the best possible outcome, and what you would have decided to do had you taken the time to stop and deliberate.

Unfortunately, most modern experiences do not require an automatic reaction, which means we often react or think in a way that is counterproductive.

For instance, let’s say you have overdrawn your account—for the third time this year. Your automatic reaction might be to yell at yourself for allowing this to happen again. Your inner monologue is all about how bad you are with money and how you will never get better and these overdrafts are a sign of immaturity. This reaction does nothing to help you solve the immediate problem of dealing with the current overdraft and fee, nor does it help you come up with a way to prevent future overdrafts.

But if you were to pay attention without reacting, you can recognize how your overdrafts seem to follow a pattern. With non-reactionary attention, you might realize that you always overdraw your account in the same month your parents visit from out of town. Keeping your non-reactionary attention on this pattern, you can see that you overspend on your parents when they visit because you want them to be proud of how well you are doing. You may be seeking their approval because you’re afraid that you are screwing up as a newly-minted adult—which is the also story you tell yourself when you overdraw your account.

By examining the situation without reaction, you can pinpoint the emotional need you are trying to fulfill by overspending, and thereby overdrawing your account. But simply reacting automatically will never allow you to fix the problem or even understand what it is.

Without Judgment

We spend a great deal of time thinking about how things “should” be, rather than accepting how they are. The problem with judging situations (financial or otherwise) based on what should be, is that such judgments tend to come with a big heaping side of shame.

Even if you pay attention in the present moment without reaction, your financial decisions will not be the best they can be if you are judging them. That’s because your judgment may make you feel ashamed of your responses, decisions, or wants, leading you away from the financial decision that is best for you.

Alternatively, indulging in judgment may allow you to feel justified in shaming others. Not only does such shaming make it difficult for you live with, deal with, and navigate the decisions of others, shaming may become more important to you than making the best financial decisions for yourself.

Your mindful financial independence is not just about having the money you need to support yourself without working at unfulfilling jobs. It’s also about being free from your own and others’ unrealistic expectations about money. Paying attention to your financial life without judgment will allow you to separate the necessary from the unnecessary.

Learning how to let go of “should be” thinking about finances can help you end the judgments that keep you from making the best money decisions for your life.

With Open-Hearted Compassion

It is human nature to sometimes assume the worst of ourselves and others. Learning how to have a compassionate viewpoint of ourselves and others will allow you to truly investigate the reasons behind your own and others’ reactions and decisions. Recognizing that everyone is imperfect and that we all fail sometimes can help you to grow from your own experiences and give others the room they need to grow.

Starting from compassion can also help you to see that people generally have a reason for their behavior, even if it seems like an unreasonable action. For example, going on a retail therapy binge after you get laid off may look like a counterproductive choice, but it is fulfilling an important emotional need. Paying attention to this decision with compassion can allow you to pinpoint the emotional need that shopping is filling, whereas simply beating yourself up does not get you any closer to feeling better emotionally or ending the disordered money behavior.

Defining Your Personal Mindful Financial Independence

Adopting mindful responses to your financial situation is only part of creating mindful independence. You also need to take the time to define what it is you want from financial independence. Thinking through the following questions can help you decide what you want to build your life to be:

1. What would my life look like if I did not have to earn money?

It can be tough to tell the difference between running toward the life you want and escaping a life you are not enjoying. You might yearn for early retirement if you are stuck in a toxic work environment or overwhelmed by financial stress. Thinking through this question can help you determine if you are dreaming of the ability to get proper rest and end the stress you are living under, or if you have a specific vision of where you want your life to go. The more specific you get in envisioning this life, the better positioned you will be to achieve it.

2. What does money mean to me?

Thinking deeply about this question can help you get a better understanding of your relationship with money. Until you consciously know how you react to money, it is much more difficult to recognize when you are having disordered financial reactions.

3. What can I accomplish within the next week that would make me really excited?

You can bring your current life into better alignment with what you want by embracing the small actions you can take immediately. Mindful financial independence can be a long road, but it starts today with the little things that can immediately improve your quality of life.

Live Free

We each only get one go-around on this rock, which makes it a damn shame to spend that time feeling beholden or dependent on something or someone else. Creating a life that feels independent, whether you continue to work for a paycheck or not, gives you the opportunity to feel in control of your life and your choices.

Using the building blocks of mindfulness and making your financial choices with intention can help you be free—no matter where you start from.


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