The 3 Ways to Balance Money and Meaning

We all make decisions in life that trade-off between what we do for money and how we’d spend our time if money was no object.

Even those who make a living doing something they delight in still have to contend with the money problem. For example, Lionel Messi gets paid to play the game he loves, and also spends time doing this:

Is Lionel Messi passionate about chicken? Or American chain restaurants? I’d guess not. But even while earning over $100 million per year in compensation playing for FC Barcelona, Messi decided it was worth his time to ink a five-year deal with Hard Rock Cafe.

This may be a solid financial decision—athletes have a limited time window in which they’re a hot commodity, after which their earning power drastically drops. However, with career earnings of over $1 billion, I wonder how Messi will look back on this from his deathbed.

How much is a year of Messi’s life worth?

How about a year of yours?

This has been the core question I’ve sat with for the last decade—how to balance money and meaning on the entrepreneurial path. And there are three archetypal ways that I’ve seen people approach the question:

• The deferred life plan
• Being bivocational
• Choosing to integrate

I’ve had a front row seat to success and failure on each of these paths: I’ve pursued each of these strategies at various times and have helped hundreds of founders grapple with these questions in the communities I’ve built and in my individual coaching practice. 

So how does one choose which approach to take?

In this piece, we’ll explore what each of these strategies look like when done well versus done poorly, and how you can approach the question with more intention to decide how you truly want to spend your days.

The deferred life plan

The term “deferred life plan” was coined by the venture capitalist Randy Komisar in his book, The Monk and the Riddle. It is the choice to do something lucrative now, so you can make enough money to eventually do what you really want. 

Sam Altman put it this way in a recent episode of the Y Combinator podcast:

“It’s saying some version of this sentence: My life's work is to build rockets, so I'm going to make $100 million in the next 3-4 years… with my crypto hedge fund, because I don't want to think about the money problem anymore. And then I'm gonna build rockets.”

One example of this strategy working is my friend Blake, who was an early engineer at a number of Silicon Valley startups in the 2010s. He joined each company on its way to unicorn status, and after a decade of developer salaries and two IPOs, he was able to retire in his early 30s. Now, he gets to work on whatever he wants.

But you don’t have to work in tech for this strategy to work. Another friend of mine, Douglas, was able to retire in his early forties on a salary of $36,000 per year. He lived frugally, invested well, and now spends his days writing, thinking, and working as a spiritual director.

When the deferred life plan works, it tends to be because:

• You place high-probability bets on income.
• You live frugally relative to your income.
• You enjoy your day-to-day work enough that you don’t mind doing it for a decade or more.

The most common pitfall on the deferred life plan is lifestyle creep. When you make more money, you acquire more expensive tastes, and your costs rise to meet your new level of income. This is why one third of Americans making $250,000 per year still live paycheck to paycheck.

Problems also arise when you pursue risky paths to income. When startups become your deferred life plan, you can invest years of your life into projects that never pay off. If short-term cash is your primary motivation, FAANGs and Wall Street are often a better path. Indeed, I know several founders who have transitioned into finance after a decade in startups without an exit.

Another challenge of the deferred life plan is that, even when you do reach your desired level of wealth, work may have been so all-consuming that you’ve forgotten who you are outside of it. As Randy Komisar wrote for Harvard Business Week:

“The lucky winners may… find themselves aimless, directionless. Either they never knew what they "really" wanted to do or they've spent so much time in the first step (making money) and invested so much psychic capital that they're completely lost without it.”

Finally, the biggest potential hazard on the deferred life plan is that you may not have as much time left as you think we do. A friend of a friend was just diagnosed with throat cancer in his early thirties. He’ll likely be dead within the year.

Being bivocational

Whereas the deferred life plan approaches money and meaning sequentially, the bivocational path approaches them in parallel. It is the choice to make income in a way that leaves time to pursue meaning outside of work in the form of art, hobbies, or side projects.