To achieve financial independence, Parkinson’s Law needs to be violated. The law states that “work expands so as to fill the time available for its completion.” This saying, written in 1955 by Northcote Parkinson, is so common and natural an occurrence that all of us, at some point, have experienced the law in our lives.
Remember that Saturday you woke up bright and early to spend 3 hours cleaning the house / fixing the car / tending the garden / doing the plumbing? What was supposed to take you no more than 3 hours ended up taking you the whole day! Parkinson’s Law.
Or that assignment you were given 3 months ago at the start of term, which you tossed somewhere until 4 days before it was due? Only you know the colour of the midnight candle(s) you had to burn in order to hand in your paper by the deadline. Parkinson’s Law.
But it doesn’t stop there. Parkinson’s Law also manifests in our finances, such that no matter how much money we earn, it appears that there just isn’t enough to cover our expenses, let alone pursue our goals.
Think about it this way.
If you are working your first job, you may already be living a lifestyle noticeably different from the one you had as a student, when your finances were down. Gone are the garri, guguru and ekpa days. Levels don change!
If you have been working for some time, there is a high chance that the ratio of your expenses to your earnings has gone up over time, whether your salary has remained constant or has increased.
Parkinson’s Law says our expenses (work) will expand to fill (consume) the money (time) available for its completion (execution). Our expenses will continue to defy gravity, unless and until we pressure Parkinson’s Law.
This pressure (of the Law) is inversely related to our financial freedom. If we are determined to move our financial lives forward, we need a wedge between our earnings and our expenses. This wedge is our savings. We secure it when we lock our expenses down to a definite % of salary, and savest the rest. Over time, our earnings may grow, due to salary increases, or income from investments. As long as our expenses are under control, any additional earnings help us widen the savesting wedge, and bring us closer to financial freedom.
A wedge enables us to achieve financial freedom. Break the law, yes Parkinson’s Law.
About the author:
Obiocha Eze-Emaeyak studied corporate finance and strategy at Manchester and IE Business Schools. She practises personal finance at Me & Myself.
Follow her @K1YUS3V3N