Tyler Durden’s Guide To Personal Finance

146 Comments / By Baker / September 14, 2009 March 29, 2011

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I am Baker’s raging excitement…

I think I’m going to enjoy writing this much more than you enjoy reading it.

For those of you who aren’t familiar with Tyler Durden, he is an essential character in Fight Club, which is both a novel and movie. While the novel came a few years before, the movie escalated into a cult classic in the years following its DVD release. If you aren’t familiar with the character, well… we should probably part ways here. 🙂

For those that are still with me, let’s get some things out of the way. We aren’t going to be talking about masculinity, violence, mental disorders, religion, or even politics. These themes run rampant through the movie and have been discussed in great length and detail by individuals much smarter and more witty than me.

Instead, we are going to have fun. We are going to dive into some of the most famous of Tyler’s quotes (movie) and attempt to pull any applicable personal finance wisdom from them. The movie’s strong anti-consumerism message will make some of these very easy, while others may seem like more of a stretch. I’ll let you decide!

Here are Tyler’s thought on a wide variety of personal finance themes:

On the pursuits of material possessions…

“The things you own end up owning you.”

Let’s start the party off right. This is not only my favorite, but certainly one of the most popular quotes in the entire movie. The lead-up, timing, and delivery make it’s impact undeniable. As I mentioned in my last post, my suggestion for this is to create a list of everything you own… and sell half within the next two weeks. Or rig your condo and blow them all up. Whatever floats your boat.

On avoiding lifestyle inflation…

“Sticking feathers up your butt does not make you a chicken”

Leveraging debt and living outside of your means has its benefits. For example, on a short time, frame you can get very good at looking wealthy, happy, or successful. Heck, you can even feel these emotions for a while. But in the long run it’s all imitation. You can pretend all you want, but eventually it’s going to crumble.

On rejecting consumerism…

“We’re consumers. We are bi-products of a lifestyle obsession. Murder, crime, poverty, these things don’t concern me. What concerns me are celebrity magazines, television with 500 channels, some guy’s name on my underwear.”

Obviously this is one of the central themes of Tyler’s philosophy. While his approach is rather extreme, it’s hard to argue against the fact that our obsession with consuming is at very core of the majority of our financial woes. While capitalism has many great benefits, we’ve got to be able to set limits, especially in our personal lives.

On separating your identity from your financial picture…

“You’re not your job. You’re not how much money you have in the bank. You’re not the car you drive. You’re not the contents of your wallet. You’re not your fucking khakis.”

Far too many people draw a major part of identity from the state of their financial life, their career, or their possessions. We can all agree that establishing control over your financial life is important in maintaining a balanced life. Buts it’s only one part of many that goes into this. My motto… make your finances a priority, but not the priority.

On recovering from financial mistakes…

“Only after disaster can we be resurrected.”

There is no financial situation that is so grim that you cannot bounce back. There are endless success stories of people who’ve overcome extremely desperate financial conditions and came out on top. In fact, many of us need to hit our own ‘rock bottom’ before any lasting change can be made. Stop making excuses and start creating your own personal recovery story.

On sowing first… so you can reap down the road…

“You wanna make an omelet, you gotta break some eggs.”

Success in personal finance rarely comes quickly. Of the times that it does, it’s usually gone within a couple years. Just ask the average lottery winner. To create lasting change you’ve got to sacrifice up front. You’ve got to take care of the daily basics. The ones that aren’t as sexy or appealing as many alternatives. In the end, though, you’ll be the one enjoying the omelet.

On the ability to learn, grow, and evolve…

“I say never be complete, I say stop being perfect, I say let… lets evolve, let the chips fall where they may.”

Another one of my personal favorites. It’s reminds us all that personal finance, like the other areas of our lives, is about the journey rather than the destination. There’s nothing wrong with saving for retirement, but your life shouldn’t be one big climb up to the edge of a cliff. Make it a journey. It’ll be mostly uphill, but take the scenic, winding route and allow yourself to enjoy the view.

On the courage to take control of your finances…

“People do it everyday, they talk to themselves… they see themselves as they’d like to be, they don’t have the courage you have, to just run with it.”

Everyone wishes they could pay off debt. They wish they had the savings to start their business or follow their passions. They dream of nailing the perfect job at a great company. But the people who accomplish these things actually do something about it. Tyler points out that it all comes down to courage. The courage to run with it.

On overcoming emotions to make wise financial decisions…

“Listen, you can run water over your hand and make it worse or… LOOK AT ME… or you can use vinegar and neutralize the burn.”

Emotions play a huge part in our finances. They are an integral part of how we spend our money, what decisions we make regarding major life events, and even how we react to the stock market and our investing. There are many times in the heat of the moment that we end up making our worst financial mistakes. Instead of taking the quickest, easiest, or most convenient option, we need to slow down and think about what will be the most effective choice.

On the value of trusting your financial advisors…

“You don’t know where I’ve been, Lou… you don’t know where I’ve been.”

A little bit of a stretch? Maybe. In all honesty, though, if we’ve learned anything from our current recessions its that we need to be careful who we trust with our hard earned investing dollars. There are seasoned and qualified professional in every community, we’ve just got to take extra steps to ensure we ‘know where they’ve been.’

On keeping your financial life in perspective…

“First you have to give up, first you have to know… not fear… know… that someday you’re gonna die.”

Why this may appear to be a negative quote, Tyler actually uses it to empower. And it’s 100% true. We can’t take any of it with us. This isn’t about living a fast life or squandering just to squander. A wretched financial existence has the potential to bleed into and poison every other aspect of your life. By taking control of our finances, we can leverage them to support the pursuits in life that are the most fulfilling.

On not settling in your career…

“I see all this potential, and I see squandering. God damn it, an entire generation pumping gas, waiting tables; slaves with white collars.”

At some point, for a wide variety of reasons, many of us settle. We settle for average and for comfort. Rather than pursue our passions and fail, we lower our expectations and conform. More often than not, this ends up limiting both our happiness and our finances. We’ve got to find ways to recreate that spark. We need to realize that it’s better to try and fail, than to settle and regret.

On conscious spending…

“Advertising has us chasing cars and clothes, working jobs we hate so we can buy shit we don’t need.”

As many of you know, this is a big one for me. Courtney and I are constantly looking for ways to ensure that we are open-eyed and aware when we spend our money. It’s not that we never choose to ‘blow’ money. But rather that we are the ones making the choice to buy and not the advertisers or the neighbors down the street. Whether you use credit, debit, or cash, it’s important to take steps to ensure you’re spending consciously.

On adjusting to the ‘real’ world out of school…

“We’ve all been raised on television to believe that one day we’d all be millionaires, and movie gods, and rock stars. But we won’t. And we’re slowly learning that fact. And we’re very, very pissed off.”

Everyone goes through this phase. It happens right out of high school, during our college years, or at some point soon after graduation. It’s adjusting from more sheltered life to the harsh reality of the ‘real’ world. Some of us panic and revolt. Others get scared and settle. Neither of these extremes holds all the answers. Balancing the drive to pursue your passions with the immediate need to ‘make’ a living is a continual struggle for all but a lucky few.

On striving for a work/life balance…

“I am free in all the ways that you are not.”

This quote has many meanings. While it’s true, it’s also ironic. The whole truth is Tyler isn’t really free, either. His radical and obsessive nature is a restriction in itself. Ultimately, true freedom would exist somewhere in between the two polarizing characters, which is one aspect that makes the story so compelling. It’s the quest for this balance that removes our limitations and let’s us truly shine.

On not being afraid to take risks…

“I don’t wanna die without any scars.”

There is such a thing as being too conservative, especially in our approach to finances. There’s nothing admirable about being cheap. Nothing cool about being a tightwad. There’s a fine line between these traits and earnest frugality, but the line is there. You’ve got to be willing to take some risks, even in your finances. Giving yourself room to live a little will help you avoid burnout, breakdown, or self-destruction. Don’t be afraid to take some chances and make some mistakes.

On ‘doing what works for you’…

“How’s that working out for you? – [What?] – Being clever. – [Great.] – Keep it up then… right up.”

Tyler’s message here is clear. Once you find something that works, don’t mess it up. If you find a way to budget that works for your family, use it. If you’ve found that slicing your credit cards into tiny pieces enables you to clearly focus on your financial goals, go get a sharp knife. Explore until you find something that fits you and then keep plugging away at it. It’s really that simple.

On mastering the basics of personal finance…

“To make soap, first we render fat.”

Personal finance principles build upon themselves. Everyone learns in different ways, however there are certain fundamental aspects that with make everything else more smooth. For example, all the fancy investing techniques and career advances won’t get you anywhere if you’re spending more than you make and constantly plagued by lifestyle inflation. Even at high levels of income, the basics like creating a liquid emergency fund, sticking to a budget, and avoiding impulse purchases are essential. Fundamentals first, just like in little league.

On the quarter-life crisis dilemma…

“My dad never went to college, so it was real important that I go. – [Sounds familiar.] – So I graduate, I call him up long distance, I say ‘Dad, now what?’ He says, ‘Get a job.'”

What am I going to be when I grow up? I still don’t know the answer to this question. Unfortunately, the standard life path of elementary-middle-high-college-job-marriage-job-kid-kid-job-job-retire-die doesn’t really encourage us to explore much. At least not until we retire. I know firsthand what it’s like to be responsible for more than just yourself. Ultimately, though, we still have the choice to design our financial lives so that they are more in line with our passions and purpose.

As you can see, Tyler Durden seems to know more about personal finance than you’d first expect. Which lines are your favorite? What other personal finance lessons can we take from these? Remember, this is your life and it’s ending one minute at a time. What are you going to do today to take control of the time you have left?