The theory of financial relativity.

I've heard people define their relative success in phrases like "I paid more taxes last year than I used to make, total." or "I paid more for my last car than I did for my first house."

My theory of financial relativity: A floating number of current achievement that is more than you used to have but less than you currently want.

Here's how to have what you want financially:

Understand that financial freedom isn't having a certain number in savings, it's having enough income that the work you do (if any) doesn't matter. If your monthly expenses are $1,000 and you bring in $1,100, you are free! If you have a million dollars but are spending it down and concerned about running out at some point, you aren't free.

While most people associate insurance with car or life, the most important kind is actually disability insurance because your income- your ability to earn money- is your single largest and most important asset. The related problem with being able to earn money is that you usually have to keep earning it. We associate portfolios of rental real estate and municipal bonds with the uber-rich, but what if they were for the common people as well?

I bought a house when I was 25 and moved out of it and across the country a month later. For years after, I learned how to negotiate leases, sniff out problem tenants and take care of good ones. I learned about mortgages and business interest and depreciation. I read books about commercial real estate. I started imagining. Then I got a job selling muni bonds, and I raised a few billion dollars. And the credit market fell apart, and came back together, and I learned some more about credit spreads and default rates and interest cycles. I got involved in politics and read some and learned some more.

My life will surely cost more as I upgrade through the years. But there's a strategy involved. There's a different number I'm aiming for- the FREEDOM number. I know what my bills are. I don't have any debt. I will be free. And I'm taking everyone I know with me.

The Training Money Can't Buy

Training matters. In some ways, it matters more than almost any other part of your job, because it sets the acceptable standard. My company puts my department's new hires through six weeks of training, followed by mentorship, followed by standing alone.

While formal training is critical, there are many types that can't be taught classroom style. What opportunities do your employees want to receive? Often, it is very different from what management is offering.

Creative ideas for training:

1) Have your front line reps spend a day training your senior leaders as if they were new employees. Not only will this highlight the good, bad and ugly of the day to day work, it can provide a unique opportunity to provide feedback. The TV show Undercover Boss was built on the premise that sometimes the problems at the top could be fixed quickly and easily with the ultimate flatness of hierarchy- the boss on the front line. It will give him or her a glimpse that no report can.

2) Consider a fellowship program. Often all it takes to recharge a tenured employee is the opportunity to work in another department for a few months. Meeting different people, learning new computer systems, connecting sideways or diagonally can not only highlight various strengths (other than the ones you were already aware of), it can also create friendships, partnerships and a great incentive for those motivated by new challenges to remain engaged.

3) Carve off time and money in your budget to allow employees to pursue their craziest ideas for your business. Google has a policy of allocating 20% of employee time to allowing people to pursue whatever hobby they find most energizing and engaging, knowing that the ideas will follow. Some of their big winners included Google News and Froogle.

When your employees know that you want them at 100% and are willing to invest in it, the entire culture starts to shift accordingly and the results will follow.

It's my party and...

I teach Sunday school to the world's best group of 5 year olds. They're not the best behaved (although most of them are pretty cool, and one of them told me I was probably the tallest person in the world), but they're mine and I adore them. I've been with them for years. I've changed their diapers and watched with great joy as they learned to read and ride their bikes.

I make a point to give every kid in my class a hug every week so I can make sure they're getting a hug every week. I hold their hands and tell them how very much Jesus loves them and how glad I am they're in my class. Then they grow up, and hopefully all of them will answer God's call on their lives, whether it's ministry or motherhood or accounting... whatever.

I teach them that character counts, and that it counts even more when it doesn't count.

So what's an appropriate place to draw the line?

Too often, I see caregivers of the weakest and the least of us terrified to use common sense. Recently, a video surfaced on YouTube of a kindergartner throwing a fit, and instead of the teacher spanking her, explaining to her what she did wrong and then giving her an opportunity to be good, the teacher was going to great pains to show she wasn't touching the little girl. Unable to calm her down, she ended up calling the cops to take the unruly child out in handcuffs.

Really?

This can't be the best we can do as society. Child abuse is unacceptable, but the death of common sense and the behavior that results has been producing a different kind of abuse. What favors are we doing our children by worshipping them? In what areas is it appropriate to expect them to have discipline when we refuse to instill any in them?

The death of common sense has far reaching implications. Congressmen are elected on promises of what they will give to people. Bankruptcy courts are full of people with no honor, who have decided that instead of taking the hard road out, cutting their lifestyles and doing what it takes to get their debts paid, they will take the hit on their credit. But what about the people who have to pay for the programs? What about the lenders who sold them goods in good faith? What about everybody who has lived inside the lines?

We must take common sense back. Political correctness has created a death of ideas, a fear of offense, a moratorium on the endless possibilities that come from a free exchange. Common sense starts by understanding we must be careful but then we must trust. We must hold people accountable to the highest standards, but we must call those standards out in them. People are capable of amazing things, more than we ever thought possible, and it starts with simple ideas like having children understand we deeply love them. Sometimes love looks like a hug and sometimes it looks like discipline. How much do we steal by withholding one of those?