Idiot Money
Go to the bookTwitterSign up for updates
  • Hello.
  • Whole-Brain Personal Finance
  • #1: The correlation between having money, managing it well, and living a good life
  • #2: Don’t know where to begin sorting out your finances? It’s not where you think it is
  • #3: Your relationship with money is complex. But it needn't be complicated.
  • #4: Spending £450k on being bad parents
  • #5: Idiot Profile: Private-Jet Guy
  • #6: What the bloody hell is a ‘relationship with money’ anyway?
  • #7: What fund managers can teach us about what really matters
  • #8: “I want money so I don’t have to think about money”
  • #9: Idiot Profile: An oligarch with a gun
  • #10: If Kanye West were a financial adviser
  • #11: If all the world's a stage, then what does it matter where you stand?
  • #12: Financial Independence: An (Actual) Idiot’s Guide
  • #13: Let’s talk about money, baby
  • #14: New Year's Non-Idiotic Financial Resolutions
  • #15: New year, old message
  • #16: "Just tell me what to do"
  • #17: How to choose better investments
  • #18: You cannot count. This leads you to make idiotic financial decisions.
  • #19: What's your number?
  • #20: 7 magnificent money lessons that have nothing to do with money
  • #21: The merits of money are negative
  • #22: The psychoanalysis of money, or How to screw up your children’s financial worldview
  • #23: The ghosts of money... and how to bust them
  • #24: My favourite way to think about investing, part 1
  • #25: The ABC of money, part 1: the three self-deceptive poisons
  • #26: Consider the pineapple: the perfect symbol of idiot money
  • #27: The ABC of money, part 2: financial nobility, an overview
  • #28: My favourite way to think about investing, part 2
  • #29: The ABC of money, part 3: financial nobility, step 1
  • #30: My favourite way to think about investing, part 3
  • #31: The ABC of money, part 4: financial nobility, step 2
  • #32: The idiocy of ignoring impermanence (the ABC of money, part 5)
  • #33: The six financial stress responses: what's yours?
  • #34: My favourite way to think about investing, part 4: betting beyond the basics
  • #35: The ABC of money, part 6: financial nobility, step 3
  • #36: My favourite way to think about investing, part 5: cost-benefit investing
  • #37: The ABC of money, part 7: financial nobility, step 4
  • #38: The best diet advice and the best financial advice are the same
  • #39: The ABC of money, part 8: The Eightfold Path and interdependence
  • #40: The dance of becoming wiser with money
  • #41: Building a better money brain (the ABC of money, part 9: neuroplasticity)
  • #42: The dumbest damn thing I’ve ever read in personal finance (part 1)
  • #43: The dumbest damn thing I’ve ever read in personal finance (part 2)
  • #44: A story of lions and loss
  • #45: The ABC of money, part 10: what meditation isn’t
  • #46: The ABC of money, part 11: what meditation is
  • #47: Idiot Profiles: Lord and Lady Jewellery Addiction, Teenage Ozymandias, and me
  • #48: Living mindfully with money (the ABC of money, part 12)
  • #49: Give, give, give, me more, more, more
  • #50: Our most costly money problems are the ones we don't see
  • #51: Align what you care for with what you care about
  • #52: Do what only you can do
  • #53: Money for many means happily ever after… but after what?
  • #54: The ABC of money, part 13: financial enlightenment
  • #55: Identifying your hidden money addictions
  • #56: Treating your hidden money addictions
  • #57: Idiot Money Maths #1: How much does it cost to keep you happy?
  • #58: The ABC of money, part 14: the secret shackles of financial freedom
  • #59: The ABC of money, part 15: freedom to, freedom from, freedom for
  • #60: If you go there blindfolded, you probably won’t like where you end up
  • #61: Idiot Money Maths #2: What is your default unit of spending?
  • #62: Balance isn’t stillness
  • #63: A problem shared
  • #64: How to live well, even in a palace (the ABC of money, part 16)
  • #65: Denunciation is still attachment (the ABC of money, part 17)
  • #66: “What do Blackheath people do?” (a story about how not to do financial planning)
  • #67: The ABC of money, part 18: Addicted to a dream
  • #68: What hot new financial knowledge are you likely to find in 2022?
  • #69: Red Pill Financial Planning: Escaping the Money Matrix
  • #70: The nasty narrowness of number-governed living
  • #71: Getting into Financial Flow
  • #72: The ABC of money, part 19: Denunciation bad, renunciation good
  • #73: I, Robot? Money and the misleading mechanisation of life choices
  • #74: Kondo your credit-card statements
  • #75: The rule of 72 (and its oft-overlooked implications)
  • #76: Forget about improving your decisions. Focus on improving your decision-making skills
  • #77: Seeing your financial world more clearly (the ABC of money, part 20)
  • #78: How to lose 2 1/2 stone in 6 months: an intro to the best non-fiction book I've ever read
  • #79: Your money worldview is (literally) half-brained
  • #80: Cost-consciousness beats cost-cutting
  • #81: Financial change that doesn’t start from your financial worldview is selling you short
  • #82: The overlooked truth of reality that is messing up how you live with money
  • #83: How money hijacks your hierarchy of attention
  • #84: The value of (almost) everything to you is nothing
  • #85: Financial philosophy > Financial psychology > Hot investment tips
  • #86: Five regrets of the rich
  • #87: Sum malfunction: a sure-fire way to spot if you’re being a financial idiot
  • #88: The Micawber Fallacy, or what your Dickensian maths misses about spending wisely
  • #89: The tell-tale signs of a poor financial worldview
  • #90: Wanting wisdom, craving financial fortune cookies
  • #91: You don’t need a scammer to be scammed: your desperation for an ‘answer’ will do almost as well
  • #92: Are you reading the wine list the wrong way around?
  • #93: Some personal finance puzzles and how not to solve them
  • #94: The main reason your relationship with money is so messed up
  • #95: The tyranny of the takeaway
  • #96: Deep wealth v shallow wealth
  • #97: What seeing your financial life more clearly looks like
  • #98: Making more of your money isn’t a maths problem
  • #99: Is what you’re doing for and with money working?
  • #100: Where to start, where to go, what to do about what’s stopping you
  • #101: The life cycle of a financial idiot
  • #102: I can read your financial mind
  • #103: Don’t worry about playing a game better when there’s a better game to play
  • #104: Reflections on two years of this newsletter, and why I’m taking a six-month break
Powered by GitBook
On this page
  • When the reductionist mindset that made the model is the problem, don’t chase a better model
  • When taking a short cut, check what you’re cutting off
  • The road to success is a spiral, not a straight line

Was this helpful?

#95: The tyranny of the takeaway

11th July, 2022

Previous#94: The main reason your relationship with money is so messed upNext#96: Deep wealth v shallow wealth

Last updated 2 years ago

Was this helpful?

Welcome to the Idiot Money newsletter. This week, becoming wiser with money by understanding that a craving for takeaways – especially in personal finance – is an affliction to treat, not a shortcut to success, including:

  • When numbers are an adequate answer, and when they’re a dangerous distraction.

  • Avoiding the death-trap siren calls of summaries of stuff that shouldn’t – can’t – be summarised… which is everything to do with how to live better.

  • And the tension between how we typically think about money and how we must think about it if we’re to use it well, which should shape any financial-coaching relationship.

Personal-finance ‘nuggets’ are junk food. Save yourself from getting burned by a bonfire of bullshit bullet points by creating your own ‘takeaways’, not desperately consuming someone else’s.

‘Before we get going, let’s quickly go around the room: what are you hoping to get out of today?’

The facilitator’s words cast their usual spell. The misdirection of suits gathered for this workshop starts twitching in a haphazard yet harmonious manner: freeform jazz meets middle-aged men (and the occasional woman) desperately searching for a more professional-sounding answer than ‘because I need the Continuing Professional Development points.’

‘A key takeaway or two.’

‘A couple of nuggets I can share with my team.’

‘A few killer stats I can use in front of clients.’

No need to specify what those ‘takeaways’ may be. As long as they don’t look out of place next to a bullet point, the information-guzzling mission can be considered accomplished.

Any notion of a transformative effect from the wise application of that information can be swept out of the way with Occam’s Broom (see footnote for the definition of your new favourite thing).

There’s a reason feedback forms are handed out long before anyone’s able to tell if anything important has actually changed, and why you should never trust a review of a habits book that’s posted within a year of reading it.

You may never have been to a financial-planning workshop. Don’t worry, you’ve not missed much. Every man, woman, and investment banker that’s spent any time in any sort of corporate world has probably experienced something similar, from the disappointing half-time sandwiches to the fear of being put on the spot by those rare questions for which there actually are wrong answers.

You may also never have been to a financial-planning meeting, either as adviser or client. While they may look different to the workshops on the surface, similar psychological monsters lurk in their depths.

Those same monsters that make us believe the workshop’s purpose is defined by its summary slide also stalk our individual relationships with money, reducing aims to numbers and life to a series of sums based on them. Learning to slay these beasts is key to worrying less about money, wasting less money, and generally making more fulfilling lives with money.

When the reductionist mindset that made the model is the problem, don’t chase a better model

There’s a tension between how we typically live with money and how to use it to live a Good Life. In short, money narrows visions by stripping them of their context. It’s about summaries, simple steps, and easy answers. Everything about a Good Life – whether you’re cultivating your own, or advising another on theirs – demands the opposite.

Nothing blinds us to reality like the model of the world built by money. Wherever humans are sailing through the choppy waters of uncertainty, sirens are sure to be circling, tempting terrified folk onto the rocks with songs about summaries and using ‘action’ as a verb.

Financial-planning meetings can talk a game good enough to look like they’ve moved beyond a fixation on takeaways. They swap obviously silly things like pretending to know where a specific share price is heading for smarter stuff like a percentage chance of running out of money before a certain date. They even caveat all the assumptions that underpin such a calculation. Except the rather important assumption that until that date, one lives like a robot in a mechanically well-behaved model of a world.

Beneath the bells and whistles and clever-sounding words like ‘stochastic’, it’s all still future-prediction. The focus is still a nonsensically inconsequential, inhumanly decontextualised number; a bullshit appeasement of a craving for certainty. But it’s seen as fine because it’s also a can-kicking, peace-of-mind-promising takeaway.

What questions an adviser asks aren’t as determinant of insightful answers as the way in which they ask them. What you think about your personal finances isn’t as determinant of how well you transform them into a Good Life as the way in which you think about them.

The most dangerous mistakes we make with money are the ones we don’t see because we’re blinded by specious sophistication like clever cashflow models.

When taking a short cut, check what you’re cutting off

This is not to say we should ignore all numbers-based approaches. They just need to be kept in a sensible place: a place where they serve, not rule, where they’re recognised as simple inputs into a wider complex web, not an objectively correct conclusion, fit to be jumped to.

We too readily dismiss entire ideas as ‘wrong’, when we’d be better being clearer on the limits within which they are true. Einstein didn’t prove Newton ‘wrong’, he just highlighted the boundaries within which Newton was right.

As Alfred North Whitehead put it: ‘In scientific investigations the question, True or False?, is usually irrelevant. The important question is, In what circumstances is this formula true, and in what circumstances is it false?’

And as J.S. Mill wrote: ‘the besetting danger is not so much of embracing falsehood for truth, as of mistaking part of the truth for the whole.’

The numbers are fine – helpful and without adequate substitute, even – for technical matters, like tax calculations, and isolated decisions that spring from them, like when and where to make a pension contribution, or extract money from a business, for example. Here, ‘truth’ is about correctness.

This is a bit of a bitch, because anywhere where the answer for you is different than it is for a robot, you need a different approach.

McGilchrist describes this in more exalted terms than are typically found in finance:

Everything which is 'technical' in the broad sense of the term, whether we are talking about the exact sciences or the humanistic sciences, is perfectly able to be communicated by teaching or conversation.

But everything that touches the domain of the existential – which is what is most important for human beings – for instance, our feeling of existence, our impressions when faced by death, our perception of nature, our sensations, and a fortiori the mystical experience, is not directly communicable. The phrases we use to describe them are conventional and banal.

If you think thinking about money is a technical, context-free matter, then you couldn’t be more misguided, and moreover your life will become banal.

(We’ll return to this idea in more detail soon, so if you’d like to make that piece better by defending the authority of the summary, hit reply.)

The road to success is a spiral, not a straight line

Construct your own takeaways. Don’t consume them, create them.

The craving for summaries is a drive for passivity. To be spoon-fed ‘insights’, even when insights, by their very nature, cannot be consumed.

This is another expression of the widespread problem that we confuse consumption with what we want, yet nothing we really want can ever be consumed.

We want the understanding to be able to create our own takeaways, to know that we know.

Yet wisdom is a way of life, not a thing. You can’t buy it. It doesn’t burrow into your brain if you bookmark enough articles or plough through enough podcasts.

It seems silly to have to say it, but the non-technical process of cleaning up your life is a fundamentally different proposition to the technical one of cleaning up your kitchen. Only one can be efficiently accomplished with some takeaways extracted from a YouTube video.

There’s a reason when people ask me for advice I ask them to dump down everything that’s on their mind about money. Every question. Every 3am thought. Anything that feels remotely relevant, from assets to anxieties.

Like a workshop facilitator wanting to avoid the collective squirming that accompanies undirected assignments, I used to give prompts: lists of information to provide, questions to answer, puzzles to think about. This made the task easier, and the results worse.

The place for prompts is later. Introduce them too early and they shape the very reality of the relationships with money I’m trying to understand.

When it comes to this sort of understanding, you’ve got to go the long way around, because the shortcut doesn’t go anywhere anybody really wants to go.

Footnote: Occam’s Broom

Occam’s Broom is a term coined by Sydney Brenner to denote ‘a device that helps one sweep under the carpet any findings that cast doubt on the current paradigm.’

‘So powerful are contemporary tools for extracting answers from nature that pausing to think about the results, or asking how one might find out how cells really work, is likely to be seen as a source of irritating delay to the managerial classes, and could even endanger the career of the questioner … I found that many people were applying what I called Occam’s Broom, which was used to sweep under the carpet any unpalatable facts that did not support the hypothesis … The orgy of fact extraction in which everybody is currently engaged has, like most consumer economies, accumulated a vast debt.’

As we’ve often had reason to remind ourselves in , most fights between ‘right’ and ‘wrong’ are misguided. If a wise-enough person has thought themselves through to a certain conclusion, it’s unlikely to be completely ‘wrong’.

(Not coincidentally nor incidentally, this simple-minded seeing of everything in either/or terms is .)

It’s a mistake refers to as seeing truth as correctness rather than unconcealing.

But specific answers to technical problems, where the answer for you is same as for a robot make up a negligible proportion of personal-finance puzzles. Yet most people, including most advisers, act like they are all there is. (And possibly hide behind .)

Where stuff that matters in the context of a human life is concerned, if something can be summarised – if there is a direct, practical, actionable, takeaway – it’s probably not actually something that matters. It certainly doesn’t need more than a very specific, time-limited, narrowly-focused analytical attention, with the aim not of arriving at an ‘actionable’ answer, but of contributing to the wiser overall view of the world, and .

To think otherwise is another form of our old friend the . It’s to prioritise arriving at an answer over prioritising which questions to ask in the first place. It’s to blindly favour simple matters purely because they take less effort to understand, despite the whole business of human life being to get more comfortable with increasing levels of complexity.

Yet we confuse consuming someone else’s summary as evidence that we’ve internalised the inescapably that got them there, and done so damn efficiently.

the last 90 weeks or so
a signature move of the left hemisphere
McGilchrist
guff like how if you can’t explain something in simple formulaic terms, you don’t understand it well enough
how you dance with it
Arrival Fallacy
participatory knowing