From Six Figures and Broke to Financial Independence Master

When Frank began practicing bankruptcy law, his average client earned between $8 to $9 an hour. A decade later, his clients increasingly earn six-figure incomes. And Dave and Beth were one of Frank’s high-earning clients. At one point, the couple had amassed over $100,000 in credit card debt and were tapping their home equity line of credit to pay for a lifestyle their family simply couldn’t afford. Dave’s six-figure annual bonus was enough to cover a large part of his outstanding credit card balances, but the debt kept piling up, and they had little choice but to seek out Frank’s services. But it wasn’t always like this for the couple.  

Dave and Beth had once lived a frugal lifestyle. Beth came from a working-class family that valued making a dollar go as far as it could. One night, Dave offered to take Beth out to Olive Garden for dinner, but Beth insisted that she stop by the grocery store and prepare a meal for the couple instead. Early on in their relationship, Beth drove a car she received in high school and refused to buy herself a new one until Dave paid off his car. So, what changed over the years? Well, their financial issues began shortly after Dave was transferred to Florida after receiving a big promotion.

Following their move, the couple purchased a four-bedroom home in an affluent, gated Orlando community. Their purchase was more significant than anticipated, yet their house was one of the smallest in the neighborhood. Soon enough, Dave and Beth found themselves surrounded by highly educated, ambitious professionals and entrepreneurs who lived in larger homes, drove nicer cars, were members of the local country club, and sent their kids to private schools.

The couple’s desire to fit into their new community, coupled with an anticipation of rising future income, led to a spending spiral to keep up with their neighbors. Dave had hoped that by using his annually granted stock options and bonuses, he would maintain his family’s spending habits. However, after a short while, Dave and Beth realized that their consumption habits weren’t sustainable, and the couple found themselves stuck in a cycle of spending that led them to Frank’s office.  


When Financial Literacy isn’t Enough

By the time Dave and Beth met with their attorney, Frank, they barely made the minimum payments on their credit cards and were facing the courts taking control of their family’s spending. How did this educated, high-earning couple go from humble means and sound financial stewardship to earning six figures and broke?

A lack of financial literacy wasn’t necessarily their problem. Recall that Beth had once embodied the value of stretching a dollar and minimizing unnecessary debt. Even so, she and Dave ended up charging $2,000 per month on clothes their family didn’t need.

Dave and Beth’s situation is an extreme example of a condition plaguing many high-earning households. You might know someone in a similar situation or maybe have found yourself in the same spot. Either way, this phenomenon is not new. Call it keeping up with the Joneses or hedonic adaptation. Addressing such challenges related to money management and wealth-building has been covered in volumes of books and seminars and are the frequent talking points of tv and radio financial gurus.  

Quick fixes like cutting back on that five-dollar cup of coffee, avoiding debt altogether, or putting your savings on autopilot are often cited, no-brainer remedies to such spend-thrift behavior. Create a budget, develop a financial plan, and stick to it. Simple, right? 

Well, many individuals, especially those well-versed in essential financial literacy topics, continue to find their financial wellbeing rising from a level of financial security up to financial freedom and then back down again to living paycheck to paycheck. Something must be missing from the equation for Dave and Beth and millions of other families just like theirs struggling to take back control of their financial situation. But what’s missing?

Living Some Else’s Money Script

Often, individuals trying to break free of this vicious financial cycle spend too much time trying to master their money without having a conscious understanding of whose life they’re living and how they want their money to make them feel. Indeed, many individuals unconsciously make financial decisions based on money scripts handed down to them by family, friends, or society at large.  

Go to college, get a high-paying job, buy a house, earn more money, join this club, upgrade your car, live in this neighborhood (not that one) and then buy a bigger house. These outcomes, or milestones, represent expectations about how we might feel once specific experiences materialize due to our earning and spending decisions.  

In Dave and Beth’s case, their financial choices were dictated by their newly chosen community members’ money scripts. Their seemingly fleeting unconscious desire for feelings of love, peace, aliveness, and freedom led them to pour money down a black hole because they were living someone else’s money script.

There’s nothing wrong with wanting to live in a big house, driving a nice car, or joining a prestigious club. More to the point, what Dave and Beth’s story illustrates is that trying to feel emotionally satisfied by chasing someone else’s expectations can prove to be a goal as elusive as trying to rid yourself of the pernicious gopher encountered by Bill Murray’s character in Caddyshack.  


Feelings Give Purpose to Your Financial Decisions

Here again, Dave and Beth’s issues didn’t revolve around knowing the proper money management techniques. Instead, their challenges came down to finding the right set of experiences that satiated deeply held emotional cravings. By this point, you’re probably asking yourself, “why are we talking about feelings?” Well, the truth is that nearly every financial decision we make is based on a desire to satisfy a complex set of feelings.  

There’s no doubt that money can make you feel secure when you use it to pay your rent or mortgage. You likely feel comfortable when you stock your refrigerator and pantry with groceries. Buying your friends a round of drinks at the local pub likely makes you feel accepted. At its core, money represents stored potential to elicit certain feelings through the experiences afforded. 

In the book “Your Money or Your Life,” author Joe Dominguez writes how “money… is life energy, or something you trade the hours of your life for… and …is like a mirror that allows [you] to see [yourself].” This truth about money is why many high-earning individuals struggle with growing their wealth for the long-term. Why?  

When financial problems crop up, these individuals are focused on trying to solve the wrong set of problems. Often, the solution to their money problems focuses on learning about new money management techniques. On the contrary, in Dave and Beth’s situation, developing a conscious awareness of the kinds of experiences that align with their desired feelings, then crafting a money script around those set of experiences could have helped them master their money.  

The reality is that few individuals are inclined to think or talk about their feelings. It’s easier to look at what’s worked for other individuals and try to emulate their lives. While some successful people may appear content from the outside, they may be struggling with as much financial discontentment as Dave and Beth. That’s why it’s essential to start with the end in mind: understand how you want your money to make you feel and identify the kinds of experiences that will get you there. So how do you determine the fitting types of experiences to pursue?

Which Experiences Matter Most to You?

The first step is understanding what matters most in your life. To this end, George Kinder built his life planning program around answering three vital questions:

  1. If you had enough money to take care of your needs now and into the future, how would you live your life?
  2. If you had five years to live, what would you do with your time?  
  3. If you only had 24 hours to live, what did you miss in life, who did you not get to be, what did you not get to do?  

Answering questions like these have helped many individuals identify vital life experiences worth pursuing, and at the same time, gain control over their finances and live more rewarding lives.

Why does this approach work? Science has shown that intrinsically oriented goals, or those that come from within, are more likely to be achieved and produce long-lasting emotional satisfaction. On the other hand, extrinsic pursuits focus on goals like getting a promotion, buying a new car, or losing ten pounds.  Studies have shown that while such reward-pursuing behavior can produce results in the near-term, their value tends to diminish over time and turns up the speed on the hedonic treadmill.  

Indeed, pursuing experiences with the intent of eliciting a specific set of feelings that matter most to you is, by its very nature, an intrinsic goal. So, how can you make an experiences-oriented approach applicable to your life? Spending time with Kinder’s three questions is one way to start. What’s more helpful, however, is developing a framework in which to put your thoughts, actions, and choices into a broader context. One approach to consider is becoming the master of your financial independence journey.  

Become the Master of Your Financial Independence Journey

In the simplest terms, financial independence represents a state of financial wellbeing where you have enough money to pursue experiences that are of utmost value to you. Unless you’re already retired or anticipating a financial windfall, becoming financially independent requires a daily discipline of creating, growing, and preserving financial wealth.  


Considering the journey itself, the path to mastery (financial independence) forces you to think outside of the constraints of the money scripts presented to you by other people. Indeed, pursuing those experiences that satisfy feelings core your value system can activate higher levels of intrinsic motivation and potentially reduce the yo-yo effect of unconscious spending.  

What’s more, the journey itself becomes transformative. For example, each step in the wealth-building process (creating, growing, and preserving wealth) serves an explicit role in helping you move toward financial independence.

Each of these steps requires you to learn disciplines that enable you to build wealth for the long-term. And because the knowledge your gaining serves an intrinsically defined purpose, its application likely will have a more profound impact on your achieving financial independence than learning money management techniques simply for the sake of knowledge.  

When it comes down to it, many individuals see their financial choices as discrete win/lose outcomes. And more often than not, people play the game of life simply not to lose: settling for comfort rather than striving for a goal they may fail. They’re looking for quick fixes, temporary relief to get them through their day.

While this approach may work initially, a deliberate lack of understanding of what intrinsically motivates you might leave you feeling stuck in a perpetual cycle of earning and spending more but making little headway towards long-term financial goals.

Whether you’re earning six figures and broke like Dave and Beth, or simply trying to take control of your finances, learning a new financial management technique, determining your “retirement number” or some material outcome may not be the approach you need. What might suit your situation better is reframing your relationship with money, rewriting your money scripts and becoming the master of your financial independence journey.

Indeed, endeavoring to master your financial independence journey sets the stage for defining the kinds of essential experiences in your life. Better yet, the journey might ultimately transform you into a fitter financial steward with less stress than you had imagined.