Want Peace of Mind? Spend Prudently

Recently I found myself on the top floor of One Chase Manhattan Plaza, a huge skyscraper near Wall Street. I was there to hear a panel on financial planning and to receive an award for my writings, including my writing in this space. As I waited and listened to the panel, I was overcome by feelings. The men and women on the panel were extremely optimistic about the economy. By and large, they were convinced that recovery would start toward the end of this year, that employment would top out at around 10 per cent in 2010 and then slowly move to better levels, that the stock market had a lot of rallying left, and that even housing would soon start to recover. One panelist in particular thought banks and insurers were wildly oversold and believed subprime-backed bonds would soon correct to the upside sharply. However, those comments, while encouraging, did not generate the wild thoughts beating about in my old brain. It so happens that, in the summer of 1969, I -- thanks to the intervention of a wonderful professor at Yale law school named Harry Wellington -- got a job as a summer clerk at a law firm in One Chase Manhattan Plaza. The law firm, now defunct, was called Reavis & McGrath. To put it mildly, I hated it. I felt as if I were a prisoner assigned to a particularly dreary, Dickensian work detail every day. The office was too small; I shared it with a man who was perfectly kind but not on my wavelength, and my supervisor was extremely unpleasant. A Lesson Learned However, it taught me that I did not want to practice law on Wall Street, and for that I am grateful. That saved me a lot of time. But, again, that was not the cause of the furious feelings beating in my chest. The cause was this: It has been 40 years since I last walked the halls of Chase Manhattan Plaza. In that time, there have been immense changes in this country. Women have been empowered. Asians, Hispanics, and Blacks have been empowered. In 1969 there were still many segregated school districts in this country. Now there are none. Then we were all terrified of the Russians and thought the Vietnam War would never end. Now the Russians are capitalists in a big way, and we have wars in Iraq and Afghanistan that never end. Then we were afraid of a Soviet nuclear strike. Now we fear Iran, North Korea, and Pakistan. But, I thought, there are some constants. Man’s nature is a constant. Man is fearful, avaricious, cunning, shifty, and untrustworthy in many cases, and many of those men wind up in those big buildings on Wall Street. But man is also hardworking, daring, committed to innovation, and eagerly willing to help his fellow man -- and one or two of those people wind up on Wall Street, too. However, the main reason I felt so worked up about being back where I was 40 years ago is because all those years have passed, so much of my life is over, and relatively little remains. And I have spent so much of my life worrying about money that it makes me want to weep. I didn’t have to do it; I have never been even remotely close to broke (except for a few months when an old girlfriend talked me into buying a house I could not afford just before I lost my job with Richard Nixon). I live a life of plentiful food (way too plentiful), comfortable shelter, and a wonderful car -- and, more important, a loving family and dogs. An Endless Worry But I still worry endlessly about money, and this has largely to do with one immensely bad habit I have: I like to spend extravagantly. I am not sure why. My sister is extremely sensible about money, and so were my parents. Maybe my wild overspending is a reaction against my upbringing. Luckily, I have also been a wild over-earner. However, I scare myself with my extravagance. I wish I had been more restrained -- then I would not have to worry as much about the future. Yes, of course I have savings. Yes, I am a careful finder of bargains. Yes, naturally I am exaggerating the situation -- but not by much. I was dealt many hard blows by the tech crash of a decade ago and many cruel whacks by the crash of 2007-09 and the real estate correction. Many lies have been told to me by Wall Street and its minions. But the worst blows to my peace of mind have come from my own imprudence. Since my father died 10 years ago, there has been no one to restrain me and my bad habits. I wish I had a good financial planner who could gently guide my spending habits down to a sensible level. If I may say so, this incredibly simple prescription -- spend prudently -- is so rarely observed and obeyed and so often transgressed that, if it could be corrected, it would send a wave of peace over the nation. That will be my goal for the next 40 years: to spend prudently. If you are smart, it will be yours, too. Ben Stein is a lawyer, economist, and commentator on finance Yahoo