I remember the day very well. It was January 26, 2018. I’d just paid my first New York rent with my first New York salary. I lived in a modest apartment—a 4th-floor walk-up shared with two other guys in their mid-20s. But the first room as you entered was mine. I earned a modest salary—a junior journalist’s paycheck. But the dollars in my bank account were mine.
My family had supported me some of the way through my Master’s program (most came through a scholarship) and a few thousand of their hard-earned dollars were sitting in my bank account too—but I had paid my rent, my bills, my beer, all by myself. After a year of job rejections including six months living in my aunt and uncle’s basement in New Jersey, I had finally done what I’d come to America to do: sit alone on my bed on a Friday night, crack open a cold one and toast to my achievement. At the age of 27, I had scrambled a foothold in the US and more importantly, had finally attained financial independence. I remember smiling to myself on that tired evening and looking out at the beautiful, distant Manhattan skyline and feeling like I had, maybe, perhaps, *whisper it*, arrived into adulthood.
Paying all my monthly expenses while living a life I find truly comfortable is what I consider financial independence. I would say, earning $50,000/year in New York or Rs. 50,000/month in Mumbai will give you the trappings of an independent life: a shared apartment in a reasonable part of town, enough money to treat yourself to a nice meal or two every week, and the means to take one nice holiday a year.
There probably isn’t much leftover for savings and future financial planning. But the present is pleasant, and this is good enough. This is financial independence.
Then there is a level up from there, I think, called financial comfort, where you earn $100,000/year in New York or Rs. 1 lakh/month in Mumbai and you can rent a nice place on your own and start to invest meaningful sums every month and think about that car loan or mortgage. How does this threshold vary for kids from other backgrounds? And what did financial independence look like for my parents’ generation?
At this point, I think it’s important to acknowledge my own privilege at even having a conversation about financial independence. For many in India, there is no hope for it, let alone a path towards it. There must be innumerable millions who will need to live on the farm or tend to the family business just to keep food on the table. There must be many more who are locked in vicious cycles of debt—either their own or their family’s. And lastly, there must be untold masses who wish to climb the ladder of life but who are denied by society’s ghastly demarcation of religion, caste, gender and so on. We must acknowledge them and we must eventually use our financial independence to give them theirs.
As a child, you understand that money is a source of mobility in life and that you’re not in charge of it. Those who control money, control you—your parents are the main example. And slowly you get access to it and start to build a sense of autonomy till you hopefully reach financial independence, thereby gaining access to the world on your terms. This is my Western-tinged worldview and I wonder how people feel in other cultures, where your money simply becomes the family’s money as you continue living in a multi-generational or extended-family household?
I think the notion of financial independence has come to the fore through liberalization and globalization, where young people leave home to seek work in cities, for instance. For most of my 20s, I had semi-autonomy in this regard: I could spend my money within certain limits, since it mostly came from my family.
I lived at home after undergrad for three years and there was a tacit agreement that while I lived in my parents’ home, I was to live by their rules. It is only in my late 20s that I experienced financial independence and met other young people who had had a major head-start on me. I saw the degree of freedom they had from their parents and craved it too. From pop-culture and my parent’s own journey, I internalized the concept of an upward earning trajectory, toward an eventual goal of ‘having enough’ to live a life free of monetary peril. I thought the aim was to earn enough that even if you get cancer someday, you can pay the hospital bills and your kids can go to a good college and you and your partner can live out your lives together in a sunny duplex in Goa. That’s where you get to if you do everything right.
What has Covid done to this idea of financial independence and the steady upward trajectory? The prognosis is not good. Let’s take housing, for example.
A family-friend in Mumbai gave up her expensive lease last month (since their work has gone remote) and moved back in with her parents in Bangalore. She told me how amazing she’d felt to arrive in Mumbai and stand on her own two feet a year ago—and how difficult, how defeating it felt to leave that life.
In New York, the pandemic has pushed millennial homebuyers towards the suburbs. And what about those still studying?
My sister’s summer internship in the Netherlands was canceled because of Covid, throwing her into a frenzied job search right at the busiest part of a grueling first year of her Master’s program.
My old grad school roommate, meanwhile, has deferred admission to his MBA program by a year. Spare a thought for debt-laden graduates preparing to enter the job market today (say a special prayer for those international students whose home countries have depreciating currencies) who have had their employment prospects razed altogether. “The economic fallout of the Covid pandemic has been harder on millennials, who are already indebted and a step behind on the career ladder from the last financial crisis,” says a Wall Street Journal report.
Even those who have jobs feel the sword of Covid uncertainty hanging over their necks; we all know that in times of crisis, the senior folks take a pay cut while the younger staff are let go altogether. India never really had a culture of getting fired—until now. Think of those who were recently laid off, who gained financial independence only to have it cruelly snatched away. How do they readjust to financial dependence?
For my generation, this is the second “once in a lifetime global catastrophe” we’ve faced and I think many of us now expect economic collapse every few years. Have recurring crises jaundiced the very notion of permanent financial independence? The concept of the ‘steady upward trajectory’ has gone out of the window.
“OK you’re financially independent – but for how long?” It seems obvious to me that for many, Covid had pushed out the date for financial independence by years.
I think there is an autonomy—a certain sense of self—that comes from achieving financial independence from your parents, even from hands-off parents like mine, who worked so hard to give my sister and me a life of luxury, relative to the average Indian our age. For me, it was benevolent independence without abrasion or malice, as opposed to a post-colonial freedom struggle. Financial independence forever changes the dynamic between you and your parents, from a purely parent-child relationship to one between confused adults. The control, the power, the grip they once had over your future begins to ease. In return, the loud, angry world they kept from your doorstep now knocks unabated. This is it, there’s no turning back.
How do we navigate the cross-over into financial independence from our parents, while still maintaining a respectful, loving relationship with them? How do we set boundaries that define our shiny new adulthood without alienating people whose love for us is unconditional? I don’t need or want my parents’ advice on career stuff now; but I will certainly need their help when I have kids or when I need to buy a house! Fledgeling wings need guidance still. How do we make sure the door to their nurturing, parental side is always open?
I’ve been going through this re-calibration process over the past few years, but especially in recent months as I’ve come into my own as an individual with my unique worldview and values and a fiercely held idea of my place in society. I am not a therapist, but I can share a few learnings from my own experiences. There are two themes I’d like to touch upon -- setting boundaries (the external) and confronting your own insecurities (the internal).
First, I think a big part of navigating financial independence is setting boundaries with your parents and communicating these firmly but lovingly—and explaining to them where possible. And these boundaries go beyond the realm of money. Financial independence acts as a conduit for personal, political, spiritual independence and so on. It’s the gateway drug to your unique adult self and now that you have control and privacy over one big aspect of your life, you may find yourself wanting this degree of self-determination over other facets.
My dad and I have gotten into spats about what my career should look like and he’s given me the license to tell him when something is off-limits. For instance, my mum asked me how involved I’d like her to get in my dating life and was glad to have a conversation about it, rather than the usual radio silence. And in return, my parents may withhold things from me that they’re not comfortable sharing.
This “no” is not something you’re used to being told as a child but as a grown-up, I think you have to be ready to have doors shut in your face. You have to respect your parents as adults. You can’t take them for granted. They are still your parents though you are not a child. With the gift of financial independence comes the responsibility of emotional independence. The conversations are difficult but I’m glad we’re having them with intentionality.
The other big learning, after a conflict where my parents have crossed my boundaries, is to ask myself: why I’ve been triggered? So many times, even a suggestion from them about a topic I’m wary about, sets me off.
What is it that I’m insecure about? The truth is that I need to take responsibility for my feelings and my reactions, just as much as they do for their questions or suggestions. I wonder if we can ever reach a new equilibrium of loving, independent adults who happen to be deeply invested in each other’s lives?
Have you found this equilibrium? Does it vary across cultures? Why do children in the West feel less of a need to share their salaries with their parents than children in the East?
I welcome you to share your tales of conflict, reconciliation, and the precious growth thereafter. Where and when was your triumphant beer? Was there a moment that you realized you’d stepped into adulthood?
To those of you perhaps waiting to make the jump: it’s worth it. The long nights, the hard work… it’s worth it. And to those of you who have reached a new equilibrium with your parents, post-independence, how did you manage it? What did that beer taste like? Financial independence is one’s license into adulthood; it is a means to growing into your adult being, not an end in and of itself. It is the freedom to make your own choices. Now trust yourself to choose wisely.
Vijay Bhat: Three Lessons From Three Stories That Shaped My Relationship With Money
Vijay Bhat shares three stories from various stages in his life that shaped his relationship with money
- Lesson learnt during his childhood: Cut the coat according to the cloth
- Lesson learnt at the age of 22 at his first job: Prudence only keeps you afloat. To create the future, you need a surplus
- Lesson learnt at age 44 when at work to re-invent himself: Ask for what you deserve
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Still curious? Read Charles Assisi's story Why we do what we do, and where does money come into it or Gourav Jaswal's The Inglorious Goal of Doing Nothing