#46 Mental Sovereignty (and personal finance)

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What do a modern financial writer, a Roman Emperor and a survivalist podcaster have in common?  How does it apply to you in your quest for a great retirement?  Two words:

Mental Sovereignty

Today’s post is going to delve into this interesting concept, and what it means for your personal finance planning for retirement.  A bit of a philosophical post, perhaps, but I think it’s relevant.

I first heard the term “Mental Sovereignty” this week on a podcast I was listening to by Jack Spirko, The Survival Podcast.  (I told you I have a diverse appetite in podcasts).  Jack Spirko isn’t your stereotypical “extreme survivalist”.  He’s got some pretty common sense logic on things we should think about.  Bottom line:  He’s a philosopher.  I was intrigued by his use of the term.

Turns out, Mental Sovereignty wasn’t a new thought to Mr. Spirko.  Rather, the first I could find the concept was in writings from Marcus Aurelius, a Roman emperor from 161 – 180 A.D.  I came to find out that Emperor Aurelius was also a philosopher (in fact, he is considered “one of the most important Stoic philosophers” by Wikipedia).

Here’s a picture of our new friend Marcus:

Marcus Aurelius

(I’ve got to say, for a guy who lived 2,000 years ago, he looks a bit like Jase Robertson from The Duck Dynasty culture of the modern era!)…..but I digress…..

Jase Robertson

So….What does “mental sovereignty” mean?

Three definitions, in historical sequence:

Marcus Aurelius mental sovereignty

Jack Spirko’s Definition:

Mental Sovereignty – the ability to fully and wholly think for oneself by using logic, reason and all available fact to form truly independent opinions and then take useful personal action based on them.

And finally,

The Retirement Manifesto’s definition of Mental Sovereignty:

Mental Sovereignty – Independent thought and opinion, driven by personal introspection, which results in personal action consistent with one’s individually held beliefs.


What Mental Sovereignty means to Personal Finance:

Too often, we’re driven to action by external events and the opinions of others.  We all know of the negative consequences of a 24/7 “news” culture.  Editors’ pressure their staffs for eye catching headlines every day, even if activities may not warrant such attention.   At times, these external factors have an undue unfluence on our activities, and can cause action inconsistent with our personal goals, or with our deeply held beliefs.  Things that come to mind include:

  • Stock market gyrations
  • Economic news
  • National crisis
  • Social unrest
  • etc. etc. etc.

These external events, if absorbed without a deeper context and personal reflection, can result in “whipsaw” actions which can carry negative consequences for our finances in the longer term.  In this writer’s view, a much better approach is to develop:

Mental Sovereignty

Think FOR YOURSELF.  Spend some time in deep thought and introspection. Develop your own opinions and beliefs without undue influence from external factors.  Have mental sovereignty established BEFORE events occur, and have an internalized plan for how you’re going to deal with situations as they arise.  This is particularly important with your finances, as external pressures (TV advertisements, public perceptions, etc) can influence you to do things with your money that aren’t necessarily in your best long term interest.

As an example, following are several areas where you should have mental sovereignty, or a personal view and opinion, as well as an action plan for your own personal finance and retirement plan.  Develop your own personal convictions, and don’t let external events or public opinion sway your actions:

  • Materialism (see “When Is Enough….Enough“)
  • How much debt you will tolerate (action = buy a house below your debt threshold)
  • Dual income vs. Single income / stay at home parenting
  • Car purchases (action = drive a car for 10 years, only pay in cash)
  • Lessons you will teach (and model to) your children
  • Your personal savings rate (action = nothing less than 20% saved)
  • Work / Life balance (action = priortize one or the other)
  • Spiritual perspective on money (action = broader perspective)
  • Asset Allocation & Risk Tolerance (action = appropriate diversification)
  • Retirement timing (work longer for more vs. retire early with less)

Personal finance is just that – PERSONAL.  Don’t let all of “The Voices” influence decisions that you must make for yourself.  Establish your personal priorities, then develop an action plan to support your priorities regardless of external influences.

Bottom line:  Ideas have Consequences.  Ideas drive Beliefs.  Beliefs drive Actions.  Actions have Consequences.

Make sure you have conviction in your own ideas and beliefs rather than being influenced by someone with ideas other than your own.  Your actions and consequences should be driven by your convictions, not someone elses.

Mental Sovereignty – a truly great retirement, as defined by you, depends on it.