How should you spend, save, and invest your money?
If you had a paperclip to trade. what do you think you could get for it? [f your answer is not much. think again. Kyle MacDonald. an unemployed 25-year-old from Montreal. Canada. traded one red paperclip for a house. Well, actually he started with the paperclip. and 14 trades later he ended up with a house.
How did he do it? MacDonald posted each of his trade offers online using a popular trading site and his own Web site. His purpose was clear from the start. “I’m going to make a continuous chain of ‘up trades’ until get a house.” he wrote on July 12.2005.
MacDonald promised to go anywhere to make a trade. While visiting Vancouver. British Columbia. he traded the red paperclip for a pen shaped like a fish. and then he went to Seattle. Washington. for a sculpted doorknob. He traveled to Massachusetts for a camping stove, California for a generator, and New York for supplies to throw a party.
The next trade. for a snowmobile. really got things rolling. The trader was a well-known radio and television personality in Quebec. Soon the national media in Canada and the United States were running stories about the “paperclip guy.”
The trades then came fairly quickly — a trip to a town in British Columbia, a van, a recording contract, and a year’s free rent of a house in Phoenix, Arizona. MacDonald was nearing his goal. In the next few months, he “up traded” an afternoon with rock star Alice Cooper for a fancy motorized snow globe, the globe for a movie role, and the movie role for — yes — a house. Through barter, with no exchange of money, MacDonald had turned a red paperclip into a house in one year’s time.
Kyle MacDonald’s triumph proved that barter is alive and well in our market economy, but did it also show that money is obsolete? It did not. If anything, MacDonald showed how much we need money — even to accomplish a wildly successful series of barters. Throughout his adventure in bartering, MacDonald relied on money to meet his everyday wants and needs. He used money to pay for his food, clothing, shelter, phone calls, and airplane trips across the continent. Money made his bartering adventure possible.
MacDonald spent money chasing his dream. That was his choice. You have also probably made choices about what to do with your hard-earned cash. Those choices will only become more complicated as you take on more responsibility for supporting yourself. This chapter may help make that transition easier by giving you some insight into how you might choose to spend, save. and invest your money.