MY FRIEND HAFIZ HAS a common midlife problem. He’s built a successful career over 20 years. But now he wants a change—a new direction to focus his energy and talents. Over coffee, we kicked around the different paths he might take.
Some were offshoots of his current job, such as becoming an industry consultant. Others were wholly new, like becoming a writer.
“The problem,” Hafiz sighed, “is that whatever I do, it’s gotta pay for the country club.”
Hafiz explained that,

IN THE FALL OF 1994, when I was 21, I made the trip south from Iowa down I-35 to Texas. I was starting my wrestling training on Commerce Street in downtown Dallas at Doug’s Gym.

What I wasn’t expecting were the financial lessons I picked up from some of the colorful professional wrestlers of that era.

Doug’s Gym wasn’t air-conditioned. It had a classic collection of weights and machines. I felt transported back in time,

IF YOU WANT PEOPLE to do something, make it easy. That’s the big idea behind a nudge, which helps people do the right thing for themselves. It turns out that nudge has an evil twin, called sludge. Sludge makes the right thing harder to do. If you look around, sludge is everywhere.
“If you cannot get financial aid without filling out a twenty-page form, then you have been subjected to sludge,” behavioral economists Richard Thaler and Cass Sunstein write in the new “final” edition of their bestselling book Nudge.

IN MY LATE 20s, I found that I was 15 pounds heavier than when I was in high school. My cholesterol was over 200 and rising. I was huffing and puffing while mowing the lawn.
I didn’t like where this was going, plus I didn’t want to buy a new set of business suits. I decided that investing in my health was as important as investing for my wealth. If my health was shot by the time I retired,

A LOT OF INK HAS been spilled over young people’s spending decisions and the impact on retirement savings. Whether it’s a latte or a lunch out, the thinking goes, we all spend money on daily trifles that rob us of a much greater sum in the future. Back in 2019, Suze Orman made headlines when she likened a daily takeout coffee habit to “peeing $1 million down the drain.”
I’m sympathetic to this line of thinking,

WE ALL TEND TO VIEW our money as a series of distinct financial buckets. Economists consider such “mental accounting” to be irrational, and perhaps it is. But it’s also mighty useful. Consider some recent articles from HumbleDollar’s writers:

Bill Ehart talked about the separate savings accounts he has for financial emergencies, a new car and his daughter’s wedding. Sure, it would be simpler and perhaps more rational to have a single savings account.

WE ALL LIVE IN the same economy, but we experience it differently. How we react to today’s economic developments is heavily influenced by our upbringing and world events at that time. This is a key insight from the first chapter of Morgan Housel’s wonderful book The Psychology of Money.
I can think of three things that have shaped my outlook—and lead me to a very different outlook from my children. First,

WHEN YOU’RE STUCK in traffic, have you ever idly wished for another lane to ease the congestion?
Not long ago, I listened to a podcast about the eternal problem of highway congestion in Texas, especially in the Dallas-Houston-San Antonio triangle. The expert said that our fundamental problem is that planners think of traffic as a liquid, so their answer to flow problems is always to “build a bigger pipeline”—meaning more highways.
Traffic, however, behaves less like a liquid and more like a gas.

THE GREEN KNIGHT is a new, Arthurian-age fantasy film that was released at the end of July. The crux of the story: The Green Knight offers a challenge at King Arthur’s court. He will allow any knight to take a swing at him with his great axe, as long as that knight agrees to receive a blow a year and a day later. Sir Gawain, one of the youngest of the Round Table,

WE SAVE TOO LITTLE, spend too much and what we buy often disappoints. Is there an antidote for this financially self-destructive behavior? One intriguing possibility: visualization.
If you’re like me, the word itself makes you a little queasy. It conjures up images of both self-absorbed, navel-gazing yuppies (not something I aspire to be) and Olympic athletes getting in the zone (not something I’ll ever be). Still, I think there’s value in spending serious time pondering our financial goals.

I GOT STUCK IN a conversation at a dinner party recently with a name dropper. It was painful. Wanting to impress me, I suppose, I learned that, “Yes, Janet Yellen and I are good friends. I’ll be traveling to D.C. soon and I’m looking forward to connecting.”
But it didn’t end there. I also heard about this person’s exotic travels and homes around the world. And the fabulous career that supported this lavish lifestyle.

ONE FUN FACT I TELL my students about Daniel Kahneman: He won the Nobel Prize for economics without ever taking an economics course in college. Kahneman is a psychologist whose discoveries laid the foundation for the new science of behavioral economics.
One of his most important findings is that loss feels twice as painful to us as gain feels good, so the emotional scales aren’t balanced when we make economic decisions. For instance, workers will wait years to join a 401(k) because contributions can feel like a loss in spending power.

AFTER 20 YEARS, the U.S. military has withdrawn from Afghanistan. The news brought back memories of the year I spent deployed there—and a crucial financial lesson I learned. Perhaps that lesson resonates even more today given the past year’s pandemic and the role deferred gratification has lately played in many of our lives.
When you’re deployed to a combat zone, the government doesn’t tax your wages. Consequently, most soldiers can sock away a lot of money.

GROWING UP, I WAS heavily influenced by the ideals of the Protestant work ethic. Working hard and finding career success provided great satisfaction, so I assumed I’d handle the second half of my life in the same way as the first.
This wasn’t a great plan.
I was around age 50 when I came across the writings of psychiatrist Carl Jung and his discussion of the two halves of life. For me, the timing couldn’t have been better.

ONCE IT LOOKED SAFE to travel again, I didn’t waste any time. I jumped on a plane and spent three weeks in the Carolinas. It was a great vacation.
Staying in an Airbnb on Hilton Head Island gave me a much-needed chance to recharge while enjoying the beach. Renting a place on Lake Norman, the largest man-made lake in North Carolina, gave me quality time with two of my grandchildren. It was like breathing freedom again after the long COVID-19 lockdown.