• Getting By

At a time when retirees across the country are fretting over the collapse of their 401(k)s, Jane Dwinell and her husband, Sky Yardley, are living the good life. Dwinell, 55, and Yardley, 58, have no debt — no mortgage, no car payments, no credit card bills. They don’t have to work if they don’t want to; they earn $25,000 a year from their investments in Vermont state bonds, which are unaffected by fluctuations in the stock market. They live in a modest house they built themselves in Montpelier . . . when they’re not cruising the canals of France in their 27-foot houseboat.

Not bad for a couple of middle-aged hippies who first cohabited on a commune.

So, how did Dwinell and Yardley do it? They didn’t achieve financial security by working high-paying jobs, or by stumbling on a pile of money. According to Dwinell, they owe their enviable status to a book, Your Money or Your Life: 9 Steps to Transforming Your Relationship With Money and Achieving Financial Independence by Vicki Robin and Joe Dominguez. In December, Penguin Books released a revised “21st Century” edition of the 1992 New York Times bestseller, in which Dwinell and Yardley twice appear as examples.

No doubt about it, the two are frugal by nature; Dwinell is, after all, a seventh generation Vermonter. They don’t own a dishwasher, clothes dryer or microwave. When a reporter visits their house, Dwinell answers the door wearing a pair of quilted pants she made from fabric scraps.

But it’s not that they don’t spend money — they just spend it on things that are in line with their values. “I can decide,” Dwinell explains, “do I want to have a clothes dryer, or do I want to have a clothes rack and hang my clothes up? Do I want to buy a new dress, or do I want to go to the Salvation Army? Then that gives me more money so I can go to France.”

Calculations such as these are at the heart of Your Money or Your Life. The book’s title comes from a hypothetical scenario: A thief points a gun at you and says, “Your money or your life.” Which do you choose? Most of us would hand over our cash, because we value our lives more than our money.

Or do we?

Robin and Dominguez argue that if we really valued our lives, we wouldn’t spend so much time working to earn money we spend mindlessly on stuff we don’t need. They challenge us to examine what we spend and how consumption affects our quality of life.

The first step is figuring out how much money you’ve earned over your lifetime, and adding up all the assets or debts you have to show for it. The authors compare the process to stepping on a scale for the first time after the holidays — you may not want to face how much you’ve squandered over the course of your life, but you need to do it to know where you’re starting.

Next you commit to “tracking,” or writing down every penny you earn or spend. The authors also advise calculating your real hourly wage. If you’re earning $15 an hour, but your job requires you to spend a certain sum on gas, office attire or takeout food, then you need to subtract that from your earnings.

“So, let’s say your $15 an hour has turned into $10,” says Dwinell. “And you want to buy something that costs $50. Then you realize that you have to spend five hours of your life earning the money to buy that. And is it worth it?”

The next step is using this financial information to figure out how much money you need to be happy. Then you make conscious choices that help you approach that goal.

Dwinell has done all these things since she first encountered the book in 1993. In fact, after 14 years, she still tracks all her spending on a piece of scrap paper.

While the average reader of Your Money or Your Life may recoil from the sums they drop on nonessentials, the book gave Dwinell the opposite realization: She was too frugal. At the time, she and Yardley lived with their two young children on a homestead in the Northeast Kingdom. They grew their own food, worked part-time, homeschooled the kids, and made about $7000 a year. While they weren’t spending much, they weren’t saving much, either.

After reading Your Money, Dwinell decided she needed to make an investment in the future. She headed to a seminary in California, where she became a Unitarian Universalist minister. Back in Vermont, she found work as pastor of the UU congregation in Derby Line, while Yardley worked as a mediator.

Their financial situation “evolved over the years,” she says. “I kept tracking expenses, and as we got money, either from saving it or from different parents dying, we invested in Vermont bonds.”

Two years ago, Dwinell realized the couple had enough money to stop working. Now she spends her time knitting, reading, volunteering and gardening. From 2005 to 2006, she worked as executive director of the secessionist group Second Vermont Republic; she and her daughter still maintain a blog for Vermont Commons, a bimonthly journal devoted to Vermont independence.

Her advice? “Read the book,” says Dwinell. And, beyond counting dollars and cents, “start paying attention,” she suggests. “If you pay attention to everything that you do, your life probably is going to be happier and more fulfilled.”

Click a photo above to see the location.