How The Principles Of Stoicism Can Help Your Personal And Financial Life

Perhaps more than any other topic, I’ve found incredible amounts of personal value from the philosophical school of thought known as stoicism. I find stoicism invaluable for navigating the modern world while maintaining any semblance of self-control. I consider the ideas within stoicism to be an essential part of my own financial life (and personal life, as well).

This post originally appeared on The Simple Dollar.

I’ve discussed stoicism in brief in several places over the years. Today, I’m going to dig a little deeper into stoicism — or at least my interpretation of it — and show how it is really useful in terms of helping me to make sense of the world and maintain the self-control needed to find financial, professional and personal success.

A few years ago I wrote a three part series on Ralph Waldo Emerson’s essay Self-Reliance. I read it for the first time almost 20 years ago and not only has it had a tremendous impact on my life ever since, it’s also triggered a lifelong interest in philosophy and how it can impact how I choose to live my life. Stoicism actually has a great deal in common with Emerson’s writings, but the tradition started much earlier with the ancient Greeks and Romans.

What Is Stoicism?

Google actually offers up a pretty good definition of stoicism:

An ancient Greek school of philosophy founded at Athens by Zeno of Citium. The school taught that virtue, the highest good, is based on knowledge, and that the wise live in harmony with the divine Reason (also identified with Fate and Providence) that governs nature, and are indifferent to the vicissitudes of fortune and to pleasure and pain.

I tend to think of stoicism as the separation between the way the world happens to be and my emotional response to it. In other words, I strive to separate the things I can control — my internal emotions and thoughts — from the things I cannot control — the rest of the world.

It is through that control of internal emotions and thoughts that you can begin to see the real truth of things.

Take a bottle of soft drink, for instance. It’s neither good nor bad. It’s going to taste sweet and fizzy when I drink it, but the cost of that comes in the health effects — it’s going to cause me to gain weight and won’t have a good impact on blood sugar levels, either. It is what it is — neither good nor evil.

Yet, if I were passionate about drinking soft drink, I would personally hone in on the good. I would have an emotional response driving me toward the soft drink.

On the other hand, if I were focused intensely on my personal health, I would personally hone in on the bad. I would have an emotional response driving me away from the soft drink.

Those responses would mostly appear as gut feelings. I might be enticed by the soft drink… or I might be disgusted by it. In either case, my emotions are guiding me.

Those emotions, though, they’re inside me. I can control them if I so choose. It’s not easy to do so, especially at first, but when I do get them under control, I can make the decision to drink that soft drink in a more rational way. In the end, it’s a cost-benefit thing — I will enjoy the experience of the fizzy drink, but I won’t enjoy the health consequences — and I can decide for myself internally whether the cost is worth the benefit.

Once you start taking that kind of perspective about everything, it starts to become the natural way of viewing the world. You start to realise that your emotions and desires tend to mostly lead you into doing things that don’t really benefit your life and often are a detriment to your life. They guide you into experiences that may have huge negatives and guide you away from experiences that may have huge positives.

Let’s dig in a little deeper and look at some of the stoic principles that I personally find very useful.

Principles of Stoicism That You May Find Useful

While the key principles of stoicism are few and straightforward, they imply many other ideas, many of which can be useful in a modern life that isn’t strictly stoic but simply strives to build a better life for oneself. Here are some of those principles.

Acknowledge That All Emotions Come From Within and That We Create Our Own Feelings

You decide if you like something. You decide if you want something. You decide if you don’t like something. Those are decisions that are up to you, not up to the person, place, thing or idea in question.

Yet, so often, we react so automatically to things with a simple emotion or desire that we don’t even recognise that our response comes from within. We basically attribute it to that product.

Think about how you feel when you see your favourite food in the world on a plate in front of you, or when you see your favourite person again that you haven’t seen in a while. Those are feelings and emotions inside of you, created by you, but they’re such immediate responses that they feel automatic. They feel almost like they’re created by the thing that you like.

The same thing occurs during every single buying situation. You might deeply want something, but that want is something inside of you, something you created. You created it and it’s an entirely internal thing, so you can just as easily stop it if you so choose.

This is such a huge key to personal and professional and financial success. You create your emotional responses, and you can turn them off if you choose to do so. They’re all within you.

Find a Respected Mentor

When we take emotions out of the equation, our decisions are often reduced down to being based on our understanding of the world, namely the consequences of various options for us and for others.

Over time, experience teaches us quite a lot about these potential consequences of our decisions, but it’s never perfect, especially when we’re younger.

This is why a mentor is so valuable. A mentor can help us walk through the consequences of various choices that face us in life. A professional mentor can help us make good career decisions, for example. A trusted life mentor — perhaps an older relative that you trust, a pastor or just someone you respect in the community — can do the same thing for your personal decisions.

Mentors play a powerful role in helping you make decisions outside of the influence of your emotional responses. They usually don’t have an emotional stake in your choice, so they can usually look at the options for what they are and help you walk through those options. They can be invaluable, especially when you can tell that emotion is clouding your judgement.

Know That Failure Happens, but Life Goes On

One of the most powerful emotions is fear. People are afraid of lots of things: Damaging relationships, damaging their career, missing out on something and so on. The idea of failure seems very negative for most people.

The thing is, fear is just another emotion. It’s an emotion that tells us that we should never take a risk, that we should avoid failure at all costs.

If we do that, though, we miss out on a ton of opportunities. Opportunities in life almost always come with some risk of failure, and that’s OK. Failure happens. It’s really OK to fail sometimes, as long as you learn something from that failure.

Fear of failure should never hold you back from taking on challenges. Instead, if a challenge or opportunity presents itself, you should evaluate what the actual drawbacks of failure are, how likely they are and whether you could handle a worst case scenario. Nothing cuts through fear like looking at the reality of what could happen if things don’t go quite right and directly comparing that to the real benefits of taking that risk.

Fear is an emotion, like any other. When you realise that and step away from it, many professional, personal and financial risks look very different.

Read and Learn with Purpose and Apply Your New Knowledge

Part of the value of stoicism comes from being able to evaluate people, places, things, situations and ideas without emotion interfering with that judgement. To do so requires knowledge and the ability to apply that knowledge.

Thus, one of the strongest ways to become a better person in terms of properly evaluating the world is to become smarter, to build up your knowledge and to be able to apply that knowledge in the world.

If you feel uncertain and afraid about financial decisions, for example, the best response isn’t to quake in fear and postpone those decisions. The best response is to learn. Go to the library and check out some books on investing and personal finance. Learn more about those issues so that they no longer seem scary and unknown. If you do that, it becomes much easier to remove the emotion from those kinds of decisions and to truly make the best decision for you.

Be Brutally Honest with Yourself

No one is perfect. We often hold inflated views of ourselves, though, because it feels good to think that we’re above average and highly competent.

The problem is that one’s inflated view of oneself can lead them to not bother to improve themselves, and that leads to gradually falling behind others while still maintaining that self-impression of being above average. When that happens, you begin to get passed over in many aspects of life — job promotions, relationships and so on — and it doesn’t make sense to you. That can cause anger, jealousy and many other negative reactions that mostly serve to cover up the reality of what’s happening.

The best solution is to be brutally honest with yourself. How do your skills line up next to your peers? In what areas do their skills exceed yours? In what areas are you more skilled? In what areas can you improve yourself?

This does not extend to “brutal honesty” with others. “Brutal honesty” with others is a cover for being cruel, which has a ton of negative social consequences that no one wants in their life.

Reflect on Your Time Use

It should be obvious by now that stoicism ties heavily into self-reliance and self-improvement. Stoicism requires you to put emotions aside, see the world for what it is as much as possible and be brutally honest with yourself about your place in the world and the attributes you have on offer. This almost always results in a strong drive to improve yourself through acquiring knowledge, getting in better shape and other aspects of self-improvement.

The challenge for many people is finding the time to do this and, quite honestly, time management itself is a great area in which you can improve yourself. It often directly leads to more time that you can use for improving various aspects of your life.

Take a strong, serious look at how you use your time. One great way to do this is to do a time diary. I use time use trackers like Timing to keep track of how I’m using my time. This almost always shows me, in very clear terms, how well I’m using my time. Many days, I set personal goals for time use and this type of time tracker helps me keep on task.

Reflect on Your Money Use

Literally everything I said above also applies to money use, so I’m largely going to repeat the same section above because, well, it applies so well to the connection between stoicism and money.

Take a strong, serious look at how you use your money and whether or not it really makes any sense. One great way to do this is to use a spending tracker. I personally use You Need a Budget for this; the older version (version 4) allows you to track your spending offline and doesn’t require a subscription. Tracking my spending almost always shows me, in very clear terms, how well I’m using my money and whether I’m wasting it or using it in ways that will continue to bloom in my life.

Reflect on Your Purpose, and Whether You’re Actually Doing Things in Line with That Purpose

Thinking about one’s purpose in life is a rather deep question, one that often doesn’t have an easy answer. It’s something I’ve thought about a lot over the years, and I’ve come to a small handful of conclusions about what my own purpose in life is — it mostly boils down to helping others and improving myself. When I do things, I prefer to have them fall into one of those two categories.

Once you’ve really honed in on a central purpose or two, start looking at the ways in which you spend your time and ask how they’re helping you achieve that central purpose in life.

What I’ve found is that, time and time again, when I spend time on things that are more closely related to those two or three central purposes in life, I feel good, and when I do things that aren’t related to those central purposes, I feel bad. Thus, using those purposes as a general guide for how to spend my time and how to spend my money makes a lot of sense.

Kill Procrastination, for It Is Your Enemy

As I mentioned above, once you start digging into stoicism, time management becomes more important to you. The biggest reason for that is that you don’t want to waste time, because time wasted is time not spent on the things that are closest to your central purposes in life.

Unsurprisingly, this all points a very negative finger right at procrastination. Procrastination means you’re postponing doing something that’s important in order to do something that’s urgent but perhaps not nearly as important, which is a perfect example of letting emotions run your decision-making process. You want to do something else because the important thing perhaps isn’t as “fun”. The end result is that you end up under-performing on the important task.

The best approach is to start in on important tasks as soon as you know about them. Start saving for retirement now. Start working on that project now. Even if the initial steps aren’t perfect, most of the time they’re far better than doing nothing during that time.

Be Present in Each Moment

When we take ourselves out of the moment, we allow ourselves to operate on instinct, and instinct is often heavily guided by emotion. We don’t respond to things rationally and instead rely on the most instantaneous of reactions to deal with situations. In short, we make better decisions and take more away from situations if we’re present in the moment.

The solution here is easy: Whatever it is that you’re doing at the moment, focus on it. Don’t let your mind wander. Don’t spend your time thinking about something else — if your mind is on another topic, write it down and think about it later when you can focus on it instead of splitting your attention.

If you’re present in the moment, you’re far more likely to build strong relationships and make good decisions, including your spending decisions. If you’re distracted in the moment, you’re far more likely to make poor spending decisions and take less away from the moment.

Incidentally, this is why my mobile phone is completely turned off a lot of the time.

Ask Yourself ‘Why’ When You Have an Emotional Response

Even as you find yourself moving more and more into these practices, you’ll find yourself responding emotionally to things from time to time. You’ll crave something. You’ll get upset by something. You’ll get angry.

Those emotions are completely normal. The goal of stoicism is not to be emotionless, but to understand those emotions, know where they came from and thus have a better capacity for making good decisions when something similar comes around in the future.

Whenever I’m trying to figure out a desire or an emotional response, I usually use a technique that I call “the five whys”. I ask myself why I’m feeling that way, and then why the answer to that question is the way it is, and then why again, and again and yet again.

Almost always, by the fifth “why”, I’m getting somewhere. I’m usually face to face with some sort of real challenge or conflict in my life, something that I can actually process or deal with or think about. When I fix that problem, then inevitably the overly powerful emotional response goes away, which enables me to make more rational choices after that.

Remember That the Greatest Virtue Is a Rational Life

Decisions made on impulse and emotion usually end up having negative consequences — for your wallet, for your health, for your career, for your relationships. Emotion clouds us from seeing the potential pitfalls in a decision or from seeing some of the long term benefits.

Ideally, we make the best decisions possible in each situation. That’s an ideal, of course, one that we’ll never perfectly reach, but one that we can strive for and move closer to over time.

A rational life is one that leads us to fulfilling that grand purpose we have for ourselves as much as possible because we’re making decisions that lead us toward that grand purpose. Almost always, that means making smart financial decisions that are in line with our life dreams, such as saving for the future and spending less than we earn as a consistent practice. It’s all about making rational decisions as we work toward our higher purpose in life.

Further Reading

If you find stoicism to be as interesting and valuable as I do, there are several books well worth reading on the subject.

• The Obstacle Is the Way by Ryan Holliday is probably my favourite modern introduction to stoicism. It focuses on how modern people can use the things they can control to overcome the obstacles in modern life.
• Letters from a Stoic by Seneca is a great collection of essays on the classic elements of stoicism: that the universe is governed by rational rules; that a content life is achieved by a simple and rational life with duty toward a central purpose; that human suffering and failure is a part of life and can teach us many things; and that study and learning and thoughtful conversation are incredibly important.
• The Enchiridion of Epictetus is something of a practical handbook on how to life a stoic life. Much of the content lines up pretty well with what you’ll find in this post, incidentally, as it boils down to understanding your emotions, living a simple life in accordance with your purpose, keeping learning central in life and using what you have to achieve things in life.

I’d also strongly recommend Meditations by Marcus Aurelius, who was a second century AD Roman emperor. These are actually his personal notes, as he didn’t seem to intend them for publication, but it’s a very practical look at how a person can apply the principles of stoicism in life. Marcus Aurelius was clearly committed to stoicism and his writings are very insightful.

Final Thoughts

I don’t expect anyone to fully subscribe to a life of pure stoicism, but that doesn’t mean there isn’t a great deal to learn about personal growth, personal finance and achieving your goals in stoicism. I find that the more I read and reflect on the topic, the more ideas I have with which to improve my life and make better decisions, especially in the face of challenges, temptation and tragedy.

I invite you to take the time to not only reflect a little bit on stoicism and how it can help your own life, but also to dig into some of the additional readings I’ve linked to. Stoicism has helped me personally in my journey from a financial disaster and professional dissatisfaction to a much better life, and I believe these principles can help you, too.

How Stoicism’s Principles Can Help You Transform Your Financial Life [The Simple Dollar]

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