A simple framework for complex money decisions

In Homer’s Iliad, the Trojan War presents Achilles with a vexing choice. Stay home with his loved ones and live a tranquil life of obscurity; or fight til death with the guarantee of immortality through legacy.

Here Achilles describes his choice:

That two fates bear me on to the day of death.
If I hold out here and I lay siege to Troy,
My journey home is gone, but my glory never dies.
If I voyage back to the fatherland I love,
My pride, my glory dies …

3,000 years later and we’re still talking about him. Mission accomplished, Achilles. Whe presented with a continuum, he picked one of its extremities:

You probably don’t think you’re bouncing between the edge cases of life’s existential continuums (or shall we say, conundrums). But subconsciously we’re always trying to identify where we want to land. When we take conference calls during vacation to accelerate the path to partnership, there may be a micro trade-off between “the present” and legacy.

Where you land on the continuum is far from an exact science, but wouldn’t it be nice to know what zip code you’re playing in – especially when it comes to big money decisions like career changes, buying a home, public or private schooling and funding a 529 plan? And with each person impacted by a decision (spouses, kids, and aging parents) the stakes are exponentially elevated.

Here are set of axes that can help center you when thinking of life’s big money decisions:

Fifty shades of grey

Let’s start with a word of caution. When you’re evaluating long-term life decisions, there’s a ton of nuance. Using a binary framework can constrain the range of options and even set up false dichotomies. So please use these continuums as a launching point for introspection – not a discrete point to land on.


I’ve got a friend with a very specific criteria about where he wants like to live. He wants to be 30 minutes from three types of Japanese food: ramen, sushi and yakitori. (And no, he’s not Japanese.) You either think this friend is a D-bag or are a fellow foodie and lover of international food. (I can relate though with LA traffic, I’m probably at 45 mins away from each). However to many, it would be absurd to pay a premium for this set of dining options.

For many people: food, culture, music, the arts are important factors in determining where you live. It’s one of the reasons you pay a hefty premium to live in some of the world’s most expensive cities.

World's most expensive cities revealed - BBC News

The largest driver of your family’s overall expenses will be whether you pick a High Cost of Living (HCOL) or LCOL area. Clearly there’s a lot of a grey between the two, but this continuum will drive everything from home, education, food, and transport costs (not to mention taxes).

Impact vs. Profit

Let’s move from the expense side of the ledger to the income side. Without forgetting our 50 Shades of Grey caveat, it’s quite obvious that a Wall Street Banker and Teach for America corps member will have very different income trajectories.

No one can tell you which side of the continuum has more meaning (that’s a personal decision); but when evaluating your career options there are economic trade-offs to be made between improving the welfare of others and working in profit-centered industries.

Spur of the moment vs. stability

Do you want tomorrow to look like yesterday? Or do you want each day to be its own unique adventure? This part of the continuum may be influenced by how you were raised, your risk tolerance or proclivity for adventure. Where you sit on this continuum might influence the type of work you pursue (corporate vs. self-employed), how you invest (valuing liquidity vs. long-term capital appreciation) and if you’d buy or rent your home.

Private vs. Public

For a child born today, 4 year private college is expected to cost $408,844 (in aggregate). Using a savings calculator this implies saving $950 a month for 18 years to pay for this future expense. College is undoubtedly a giant needle-mover on family finances.

And in case you’re wondering, here are the assumptions (household income set to zero to not rely on scholarship):

Now this continuum has many levers: public vs. private, whose name is on the loans (if any), vocational vs. 4-year liberal arts. Identifying where your family sits on the continuum can bring clarity on whether that $950 a month needs to start today.

(And for the finance geeks, IMO the rate of return is too high and the inflation rate is too low.)

Experience vs. Stuff

I know of two RadReaders who don’t have Amazon Prime accounts. You read that right. At first blush, this terrifies me (after all, I just bought a surf leash and Apple watch band 5 minutes ago). But consider the freedom arising from the mantra:

“Do you own your stuff or does your stuff own you?” Amazon Prime definitely owns us.

While Amazon Prime isn’t necessarily a needle-mover, as you get to residences (both primary and vacation), home improvements, cars, fancy clothes and jewelry, and expensive hobbies it’s easy to forget that we actually have agency over the things we buy. Conversely, pursuing experiences doesn’t mean that that path is cheaper. Identifying where you fall on that continuum is helpful in aligning your spending to your values.

Now back to legacy

Now back to Achilles. If you’re passionate about ascending the corporate ladder, it’s easy to justify all of your behaviors by pointing to one side of the continuum (private school, stability, HCOL). But is that truly the underlying motivation? Or just lipstick on a pig?

Here’s one man’s experience. <Points thumbs towards his chest> I fear irrelevance. Like Achilles, the thought that in 100 years no one will know who the heck Khe Hy was has caused many sleepless nights. I tried to fill that void through Wall Street. Now through entrepreneurship. Thankfully the continuums can help keep me honest about what truly matters to our family.

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