A humanistic concept of net worth
Personal assets, financial assets and knowing the difference between the two
Luna Jaffe is a certified financial planner, artist, mother, partner, entrepreneur, and author. I would describe her book Wild Money as Money on the Right Side of the Brain.
I highly recommend the book for those of you who don’t learn personal finance simply by looking at words and numbers. A number of ideas in FF2 are based on exercises in this book and I’m indebted to her for a lot of understanding how others learn about money.
Speaking of which, I’m teaching fall cohorts of FF1 and FF2 in October and November. As most of you know, I don’t do marketing, other than writing this newsletter. I’ve found in running a small business, marketing becomes its own job, bigger than the actual service you provide. And all I want to do is teach. Because of my own financial independence, I don’t need School of Financial Freedom to become “successful.” Teaching personal finance is just a service to others I care passionately about, that I think is super helpful to others. Help me by spreading the word about FF1? As you know, taking control of your finances and being conscious of your relationship to money can be life-changing. And if you are FF1 alumni, this is your chance to improve your income generation and learn how to invest. And obviously, if you haven’t taken FF1, you should consider getting straight with your money. If not now, when?
Below is a post from Luna about the concept of “net worth” from a broader, more humanistic perspective. I loved it when I read it on Facebook and asked her if I could republish it. I hope you enjoy it as much as I did.
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Net worth, as defined by the black and white world of finance, is equal to your assets minus your liabilities. As a financial planner, I have one foot in this world and find that more than anything, my job has been to translate this concept into a meaningful, motivating ally for my clients. Your assets may have been earned or gifted or inherited. They may have been in your life since birth or perhaps you sacrificed everything, working day and night, to rise from the clutches of barely surviving to stand where you are today, financially independent and empowered. Liabilities, by definition, are the debts that decrease your net worth. Some of these debts we choose.... school loans, mortgages, credit cards. And there are debts that result from a health crisis, a wicked ex-spouse, a child’s bout with mental illness, being the care provider for family or unemployment.
Note: This is not a game of Monopoly, where everyone starts with the same amount of money or education or capacity to take risk. We start this journey with certain advantages or disadvantages sewn into the lining of our skin. It is too simplistic to think that increasing your net worth is a matter of motivation. Making your way around the game board carrying all the baggage that your ancestors could not unpack and release will slow you down, mess with your confidence and often impact your capacity to think long term.
Here’s the truth: a person’s financial net worth has little to do with their human net worth. It says nothing about their resilience, their depth or their happiness. It does not define their participation in community or their generosity. Financial net worth is an advantage that some leverage for good and others flaunt or squander or worse.
When I think about net worth I use a different measure. My assets are the relationships I’ve nurtured, the growth I’ve earned through deep exploration, my creative capacities, the perspectives I’ve gained by traveling the world, the beauty that I surround myself with, my curiosity AND the financial resources I’ve worked for. My liabilities are the places inside I’ve yet to heal, relationships that are broken, blindspots to privilege and race and county of origin, impatience and judgment and lack of compassion for self and others as well as my mortgage.
I remember a conversation I had with a client who is in his 70’s and leader of a spiritual community. He was lamenting that he couldn’t afford long term care insurance and berating himself for not investing in it earlier in life. I said, “Ah, but you do have long term care insurance! You have invested decades into building community and as you saw with your recent health scare, they want nothing more than to give you a tiny bit of what you have given them. All the care, food, messages and prayers that arrived at your door each day? That is your long term care insurance. You are loved, and that cannot be bought with an insurance premium.”
Money cannot buy a hand to hold, a thoughtful card delivered at just the right moment, a gesture of kindness, a painted rock with your child’s face on it. Yet wealth is present when friends gather to help you do the impossible task of birthing or burying or marrying or divorcing or graduating or letting go.
I’m deeply aware that my net worth has been built on the belief that no matter what happens, somehow I’ll land on my feet. I lost almost everything financial in two divorces, yet what I gained was sovereignty, faith in myself and resilience which have far more value than a home or a couple hundred thousand dollars.
Is the death of my son a liability, something that takes away from my worth? Depends. I can use his death as a reason to stop growing, loving, living or I can approach my loss with tenderness and honor, massaging the edges of it and allowing sorrow to become compost for something new. I could get caught in eddies of despair or I could reach out my hand and ask for help. There is no amount of money that equates to the power of reaching out or of accepting the gift of someone else’s hand.
Losing Hunter impacted my net worth. I didn’t work for three months. My ability and interest in work has changed. I’ve lost friends and found new ones. I’ve had to step away from a beloved community. My priorities and values have shifted. My root system in Portland has been altered, truncated, disturbed. My writing has blossomed and it connects me with many people across the globe. I’ve learned that I can survive the worst imaginable loss (and tears emerge as I write that... because I really have learned that there are many reasons to keep living even if I have to do it with Hunter’s physical presence, though it hurts, though it will always hurt.) I’m richer than I was before his death. I’m a better human. I know what matters and what doesn’t. I’m willing to let go of relationships that don’t work or belief systems that aren’t mine or don’t serve me. I have more self-compassion. I move more slowly and drink from the reservoir of beauty that surrounds and fills me. I gather resources, allowing myself to be inspired and transformed, and offer what I’ve learned to others. I value my marriage and understand that each day with Amy is a sparkling gem.
I’m curious. What are your assets and liabilities? How does this land with you?
Fondly,
Luna
Luna Jaffe can be found at http://lunajaffe.com/. If you enjoyed this piece, I encourage you to buy her book Wild Money or contact her for an engagement.