We have a lot to learn from history. If we take a trip down Wall Street’s memory lane, we’ll discover that it was founded on the principle of creative destruction, the creation of new industries and companies that build better products and services than those we currently have. Instead, as Tom Friedman so eloquently stated in his column this week, they’ve fallen into the horrible habit of “financing too much “destructive creation” (inventing leveraged financial products with no more societal value than betting on whether Lindy’s sold more cheesecake than strudel).” This is a problem but is not yet one that is too far gone. I believe Wall Street, and by extension our economy and our society, can be saved.
Wall Street can create jobs outside its walls
Most job creation comes from start-ups – companies founded by passionate, insightful people seeing a pain they want to fix and then inventing a product or service to alleviate that pain. Maybe that’s the need for a better vacuum cleaner – thank you, Mr. Dyson – or maybe it’s the need to help creative get their projects funded by small contributions from a large group of strangers – thank you, Kickstarter.
Why can’t financial firms take a small portion of their earnings and provide more loans to start-ups at very low-interest rates? There’s plenty of waste going on in financial firms on projects that never take off beyond the ideation phase, money that would do just as much good being burned in the middle of the street. Instead, take that money and take a chance on a set of entrepreneurs who are trying to build something of value rather than rearrange value by moving money around in a big circle.
Consider it corporate philanthropy or just the right thing to do. Wall Street should figure out how to reinvent itself as a jobs creator, and that doesn’t mean hiring more bankers. It means funding people with good ideas that the world needs. About a year ago I wrote a letter to the CEO of the company I worked for and proposed this type of idea. He never responded; he may never have received the letter. But I’m going to give it a go again and point to a recent peer of his, Howard Schultz of Starbucks, who is doing something on par with this idea.
We’re all in this together
The Occupy Wall Street protectors and the banks have conspired together in a war of “us” (the people) against “them” (the banks). It doesn’t need to be that way. And actually it can’t be that way if we want our economic situation to improve. Like it or not, money and creative ideas, together, make the world go round. We’re in this life together, in this world together. And no one person has more of a right to a good life than any other. We are equals, and we need to start treating each other and supporting each other as such.
Photo from Occupy Wall Street“Find a small stream in which your strengths can flow and then see if you can carve it into the Mississippi.” ~ Marcus Buckingham
I am conflicted about Occupy Wall Street. So conflicted, that I have been conflicted about writing anything on the situation other than a tweet here and there. I certainly support everyone’s right to speak their mind and raise their concerns. The frustration that has served as the fuel for the protest is widely understood and shared, by me and nearly everyone else I know. Yesterday someone asked me if I’ve been down to the protest, and when I said no, they were a bit surprised. Given my outspoken and scrappy personality, this movement seems like it would be a natural fit for me.
Here’s the rub: I can’t show up at the protests authentically. I work for a financial services company, I have an MBA, and though I grew up in a family of very few financial means, I pushed myself instead of the government or the economy to get my life on track. I never expected anyone to do anything to get me a job. I always felt fully responsible for my own well-being. The world never owed me anything, and never will, except the opportunity to try. My happiness and success falls squarely on my shoulders, and my shoulders alone.
Entrepreneurs
Steve Jobs and every other entrepreneur out there didn’t expect anyone to create jobs. They actually didn’t want anyone to give them a job. They wanted to build their own careers, their own companies. They wanted to invent the future, theirs and the world’s. Their futures were safer in their own two hands.
Thrifty People Susan Gregory Thomas is a single mother who takes care of her family’s nutrition and personal needs on about $100 / week thanks to an oversized amount of curiosity, necessity, and a love for simplicity. To do so, she and her family went back to the land, reluctantly, in Brooklyn. She was a freelance writer who lost most of her income in the recession and had to reign in her spending in a serious way. Her story is inspiring and shows just how much we can do when the stakes are high and the options are few. We are far more resourceful and creative than we realize.
The only people I know who really make something extraordinary out of their days are those who roll up their sleeves and build it. I recognize that people feel badly about this economy and about our government. I feel badly, too. My days are not spent doing exactly what I want to do at every single moment. There is this pesky little matter of over-sized student loans that I really want to pay off as quickly as I can. I put myself through school twice, and my education is the very best investment I’ve ever made. And that investment has come at a price tag that I am responsible for paying. To do that, I have to delay my dream of working for myself for a bit.
Of course I’d like the situation to be different, but it’s not. Complaining about it doesn’t do anything except make me feel worse so I don’t complain about it. I made my choices and now I live with their consequences. I got myself a job that pays the bills and I work on my creative projects when I’m done with my bill paying job. It won’t always be this way, though for now this will do just fine. I can make short-term sacrifices for the sake of a long-term dream.
And that may just be the trick. We want short and long-term gain, in every area of our lives. Understood sacrifice is no longer a part of our national fabric. The moment we are made to make any compromises or trade-offs, the moment we are asked to be patient for anything we want, we are furious. I’m not sure how we can sustain this mindset, and there will certainly be pain in putting our economy back together. Lots of it.
It’s this very mindset, not big business, that got us into this mess in the first place. If we hadn’t been so eager to take on more debt than we can afford and if we hadn’t been more-than-willing to buy anything and everything that big business is selling, we may well have avoided this recession, or at least made it less severe. Now we are really in a tough place, and it is very painful to look in the mirror and say, “We are responsible.” That act is ALWAYS painful. Personal responsibility is a tough and often uncomfortable possession. We are looking for someone to blame, someone whom we can hold accountable for our unhappiness and our collective mistakes. And we are looking for someone to save us. The person we are waiting for is us; we must be our own saviors,
Banks, big business, and millionaires (even self-made ones) are easy, accessible targets. I’m not in agreement with the Tea Party or the GOP – I don’t think there is anything Un-American about Occupy Wall Street. I certainly think that big business prayed on our weaknesses and made their cheap, poorly made goods and services attractive in deceptive ways. But they didn’t force us to do anything. We chose where to spend our money and how much of it.
We are free thinkers and we make choices every moment of every day. Those collective small choices brought us to where we are today. And the choices we make going forward will determine how this whole thing shakes out. In no way do I mean to discourage people from joining Occupy Wall Street. Maybe their voices will raise a new and badly needed source of consciousness in government, in business, and in the minds of individuals.
But you won’t see me Occupying Wall Street. I’m inside the belly of the beast trying to make it more compassionate and raise its awareness from the inside out. There are a lot of people like me in financial services and big business trying to do the same. If we really want to change the financial system, we first need to understand how it operates. I’ve found the best way to do that is get in there, grab a front row seat, and then work like hell to make it a better place.
My friend, Phyllis Neill (CEO of Buzz12), recently sent me a link to Glassheel.com, “a career, lifestyle and networking site for professional women. Glass Heel is an online community of bloggers, experts and professional women of all ages — with room for thousands more. This site was designed to connect you with networks, individuals, events and other useful information to help you succeed professionally and build relationships. More importantly, through the network of learning, communication, and support, Glass Heel aims to see its members reach new heights in the professional world — breaking through the proverbial glass ceiling.”
My thanks to Molly Cain and the outstanding Glass Heel community for including me in their movement to break through this glass ceiling once and for all! I’m already at work on my next post. More to read shortly…
In May 2007, I graduated from Darden Business School and moved to New York City. I didn’t have a firm job offer and I had run out of money. In June, I got a full-time job offer and to tide myself over until I got my first paycheck in July I had to take a cash advance on my American Express card at an ATM and only making the minimum credit card payment that month. This was incredibly upsetting to me because I have always prided myself on never carrying any credit card debt. Though I could see the light at the end of the tunnel, I felt that financially I had hit rock bottom. I remember standing at that ATM machine in Astoria, Queens, where I was subletting an apartment month-to-month from a friend. I must have stood there for 20 minutes before making the cash withdrawal. I felt afraid, alone, and very, very broke.
Pulling myself together
I had gotten some gift certificate money on Amazon.com and with it bought Suze Orman’s just-published book Young, Fabulous, and Broke. I tore through it in an effort to put together a plan of how to get myself back on track. In addition to having run out of money, I also had over $100,000 of school loans hanging over me. It felt like a crushing amount of debt. It was a crushing amount of debt, particularly for someone starting at $0. To make matters worse, the interest on the loans was not tax-deductible because my income was too high – no consideration for debt-to-income ratio is given by the IRS with regards to this tax rule. That rule motivated me to get rid of these loans as quickly as possible. I didn’t regret my education, though I definitely felt like I would be in debt for many years to come and have to delay a lot of my dreams, which were precisely the reasons I went to graduate school in the first place.
After a mini-breakdown at the ATM, I pulled myself together, talked to some friends about this situation, and eventually toughened up. To be honest, I made the choice to go to school, take these loans, move to New York City, and try to make a go of a career as a product developer. I had to take responsibility for this debt; I had to own it and get it paid down as fast as I could without missing out on the fun of life in the meantime. A delicate balance. I was on the road, and I just had to chin up and keep going. Feeling sorry for myself just made the situation worse so I stopped whining, poured my heart into a solid plan to put away an emergency fund (which turned out to be very important considering that the recession would hit full force 6 months later), pay down my loans, and still enjoy all of the amazing experience that New York City has to offer. That last piece was key – if I couldn’t find a way to enjoy NYC while managing my finances, what would be the point in living here?
A plan is formed
With help from Suze’s book and my own experience of never really having much money to begin with, I put a plan in place. I had a goal amount to save every month that would first be put away for my emergency fund (the amount it would take me to live for 12 months if I lose my job.) I would make the minimum payments on my school loans until my emergency fund was in place, and then use the monthly savings amount to pay down the loans. Little by little I squirreled away money while still enjoying New York City in an affordable way. I’ve never been a shopper or much of a collector so resisting the endless temptations in New York City to buy-buy-buy was easy for me – and it was key to paying down my debt. My personal yoga practice helped A LOT, as did running, taking long walks in the park, and seeing my friends as often as possible. I had a lot of anxiety about the loans and when I felt it overwhelming me, I would get out into the world to shake it off.
A huge goal realized in 3 and a half years
Friday, February 11th, was a big, beautiful day. A little over three and a half years since putting my plan into action, I paid off over half of my student loans – the entirety of the private loans I took to go to graduate school. I still have government loans from both my undergraduate (which I also paid for myself) and graduate studies, though they have a locked interest rate. I will be turning my attention toward them next, though for today I’m doing a little jig of celebration. I threw off a great big heavy chain of debt today and it feels amazing!
My book about yoga and personal finance
I’m using this experience as a basis for a book I’m working on that combines the principles of yoga and solid guidelines for developing your own personal financial plan. I want this story of debt relief to be useful to as many people as possible, and the best way to make that happen is to tell the story.
Have you accomplished a big fat goal recently or have you put a plan in place to pay down your debt despite the tough economy? Let me know your story!
This blog is also available as a podcast on Cinch and iTunes.
Last week I took a quiz from O Magazine and Suze Orman about my financial personality. I’ve been working on a book idea that combines yoga and personal finance so my brain is currently equally divided between the two disciplines, seeing so many connections and symmetries. The research for the book led me to this financial personality quiz. The result? 3 b’s and 3 e’s which makes me a I’m a penny-pincher on the right track – a person with miser tendencies who has hopes of financial liberation. The quiz is a few years old but the system holds true. I couldn’t have described by financial personality more succinctly.
On being a penny-pincher:
“You’re a penny-pincher. Being a penny-pincher doesn’t mean you’re poor; on the contrary, you probably have more than enough to live on. But you won’t spend your money; you hoard it because you are afraid to let it go—which means, in my opinion, that you are afraid of never having enough. This fear often comes from a very realistic place. Usually, people who are penny-pinchers grew up in families where either money or love was scarce; as a result, the kids grew up with fear and shame—two big obstacles to wealth. When you block the flow of money out, you also block the flow of money in. You need to open your clenched fist to receive—even if it’s one finger at a time.”
On being on the right track:
“You’re on the right track. Congratulations! You are creating a life where people come first, then money, then things. [For those who don’t know, this is Suze’s simple mantra on how to live life as well as how to make and spend money.] Either you grew up in a family that had a very healthy relationship with money or one that was so disrespectful of money that you refused to repeat its serious mistakes. Either way, you’ve learned to value who you are over what you have. You’re on the right road.”
On writing my book about yoga and personal finance:
In writing this book, I deal with my own hang-ups, memories, and fears about money. And there are many. Though I’m learning that they are all manageable and I’ve come so far in making peace with finance, and seeing as energy and a tool rather than a burden and chore to manage. Writing the book is helping in that process. And when it’s fully written, edited, and published, I hope it will help many others, too.
That’s the most wonderful thing about being a writer – we write to liberate ourselves, to throw off the chain of our own making and by the very act of putting our writing out into the world, we help others do the same. Writing is and always will be the most selfish and selfless act; a gift we give to ourselves as much as we give to others.
Take the quiz and let me know where you landed on the scale!
This blog is also available as a podcast on Cinch and iTunes.
This post is available as a podcast on Cinch and iTunes.
“Far and away the best prize that life has to offer is the chance to work hard at work worth doing.” ~ Theodore Roosevelt
“Is that really going to help you make enough money?” a friend recently asked me about my business, Compass Yoga. I didn’t get my yoga teacher training nor did I start my company in order to quit my job and make my entire income from it. The intention was, and continues to be, to do something that made my time worthwhile. The job I do for money is fine. I work with nice people, I have some flexibility in my schedule, it’s helping me pay down my school loans, and I have the chance to learn about new technologies and market innovations. It’s not the work of my life, but it makes my life’s work possible under my current circumstances.
My friend, Amy, recently told me about a book called Your Money Or Your Life. I haven’t read it yet but it’s on order through Amazon. Since I work in financial services and have always been fascinated by the psychology of money (mostly because I grew up with very few financial resources), I’m looking forward to exploring the framework. The premise of the book is this: where are you trying to go, how much do you need to get there, and what plan can you put in place right now with the income you have to get you to that point, whatever that point is? Its authors put forward the idea that it is okay to have a job that makes you money to pour into your passions. They give readers permission to separate their financial life and the work that they are most passionate about.
Now, if you are making money from your greatest passion, then I applaud you. (Please tell me how it’s going, too!) Your Money or Your Life, and this post, are for those of us who are grappling with having a job that makes us some good money but doesn’t necessarily light our fire the way our other interests do. I spoke a bit about this for my interview with Liz Massey on Creative Liberty. I spent the early part of my career working in theatre. By all accounts I had exactly the job I wanted. The trouble with that job was I worked so many hours, often without good pay, that is wore me down and actually made me hate the theatre. After I left my last theatre job, I didn’t go see a show for over a year. Now I love going to the theatre — I needed to make my money some place else so I could actually fall in love with my passion again.
I’m not in any way suggesting that you run out and make lots of money doing something you hate because your passions won’t pay you well. Not at all. What I am saying is that making money doing what you love can seem like nirvana from a far and be less than satisfying up close. I also believe that making money doing what we love can be an incremental process, and progress in increments is more than fine. Every journey really is made by putting one foot in front of the other, however long that journey may take.
I have been considering the idea for a book about yoga and personal finance. Here are the very needs of the idea in a guest blog post on Elephant Journal. Showcases what the yamas and niyamas taught me about managing my money. Let me know what you think!
I’ve heard a lot of people resolve to get a hold of their finances in 2010. 2009 knocked us all for a loop. Almost every one of our preconceptions about working and earning was turned on its head last year, and we’ve vowed to never be in that position again. Trouble is, how are we going to avoid 2009, the sequel? Where do we start?
Welcome to Smart Cookies, a clan of 20 and 30 somethings who got together for one main reason: to turn around their financial futures. They were successful women with good jobs and not much to show for it. They formed a money group and together developed strategies to improve their finances and still have fun. Now they’re sharing what they learned in a few ways: in their book, on TV, and through their on-line community.
My favorite feature on the website is the opportunity to join a local money group to get your financial engine running in the right direction and keep it that way. Check out what the Smart Cookies have to offer you on your road to financial good fortune.
While in Costa Rica, I continued reading Lynne Twist’s book The Soul of Money. So many of her sentiments about the use of money, sufficiency, and abundance have resonated with me. At the end of one particular chapter she challenges readers to explore not unanswered questions, but unquestioned answers. I have not been able to get this term out of my head. I spent a long night in Costa Rica, tossing and turning, wrestling with the unquestioned answers in my own professional life.
Since going to business school, I have been on a track – to pay back my loans, to believe that I must make a certain amount of money in my single paycheck, to climb, climb, climb as high as I can in the field of business. We hear so often that there are not enough women at the very top of business world, that people from my socioeconomic background are under-represented and needed in large corporations, as are those who embrace empathy and innovation and change. Up until now, I assumed that these sentiments were a given, answers to timeless questions and concerns in business, and that I must heed this call.
With this latest economic downturn, these very things that I have held to be true without question are now up for scrutiny. Everything is up for debate. I went to an innovation conference several weeks ago, hosted by Roger Martin of the Rotman School of Business. My former boss, Bob, invited me because he knows of my deep interest in change and design. Tim Brown, the CEO of IDEO and one of the panelists at the conference, discussed the dilemma of big business today as it relates to change. IDEO runs workshops throughout the year that are training sessions for business people to encourage more creativity within their companies. They are wildly popular events, and there’s only one problem with them. “Once people open up their minds to the world of design,” Brown said, “they can never go back. Many times, attendees of our workshops leave their jobs shortly after they complete the sessions. They can’t accept a life in typical big corporations anymore. They know better.”
Big corporations have been trying so hard to make innovation and change a part of the culture, or at least trying hard to pay lip-service to change. The difficulty is that only a handful of corporations really believe in the power and necessity of change. Target, Apple, Nike are among the few. By and large most big corporations just want to return to the good old days of fat profits, zero regulation, and big, big bonuses. Those individuals who really want change, innovation, and design to be incorporated into the fabric of a company get too frustrated with bureaucracy and the slow, lumbering gait of a company strangled by its own size. And so, they leave for smaller, more nimble, freer pastures. Who could blame them?
These are the brave souls questioning the answers that business has for so long assumed to be universal truths. Now, the truth is not quite so clear as it once was. The people who have long-benefited from business as usual (so much so that BAU has become a common acronym in their lexicon) are getting very nervous because their lifestyle is being threatened by those asking why, those who are questioning the ‘given’ answers.
For those brave enough to ask why, their dilemma now lies not in how to get their ideas heard by the ones who phone it in, but whether or not it’s even worth it to ask why at all. Many are leaving to build their own dreams, to bet on themselves rather than on a big corporation. The world of business should be afraid. To survive in this new economy, corporations need the questioners much more than the questioners need the big corporations.
I laid in my bed, realizing that these questioners are the next great breed of entrepreneurs, the next batch of people who are on the verge of jumping from the safe, secure cliff and changing the world as we know it. And then I asked myself the question, “Will I be brave enough to count myself among them?” I waited long into the night for an answer to come from the darkness, and with the sun my own heart rose up to speak a quiet, strong, clear “yes”.
Latest post on The Journal of Cultural Conversation: Keeping it Positive and what I do to maintain optimism in the current economy. It’s a bit more business-y than our signature cultural posts. One of my economics professors at Darden always opened his classes by saying economics is the most relevant of all subjects to study because it underpins everything we do in the world. He’s a bit biased of course being an economist, though I completely agree. Money talks and (fill in the blank) walks.
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Christa Avampato 