If the journey towards financial health and independence were a bus ride, there would be several stops along the way.
The first stop is paying off debt and climbing out of any holes. If we have unsecured debt from credit cards or other loans, it can feel like we’re a gerbil spinning on a wheel. We’re working to move forward, expending lots of energy, but making slow progress. Eventually, if we’re careful how we spend, we get off that wheel and get on top of our finances, but we don’t yet get off the bus.
The second stop on the bus is building reserves so we’re free and independent. If we’re that gerbil, this means we’re storing nuts and resources. We’re focusing on our future self, knowing that if we have enough set aside, we’ll be financially free. We may still work once we’re financially independent if we’re lucky enough to love our work, but we’ll have the freedom and options that come from having enough. We now sit comfortably on that bus ride.
The third stop on our ride is giving. At this point, we’ve taken care of our debts and ourselves. We’ve climbed the Maslow hierarchy of needs. We may have everything we need and more, but spending still matters and perhaps more than ever.
Billionaires Who Give
Think about Bill and Melinda Gates. Do they care about their spending? Intensely. They’ve decided that nearly all of their wealth will be spent on global health and education. They probably wake up each morning thinking about how they’re spending their money, and they have teams of people helping track their spending across a variety of meaningful causes.
Their spending is no longer about meeting their needs. It’s about impact and legacy. They have a finite amount of money. The challenges they’re addressing are hard ones to solve with any amount of money. They must stay focused, spend wisely, and track their dollars if they want to make a difference.
Spending for a deliberate life
My take-away? Spending matters, and it always will, for those who want to live a deliberate life. Money isn’t the focus of life, but if we don’t pay attention to our spending, we’re missing an opportunity to influence our lives and the lives of those around us. Every dollar we spend is a vote.
From the time I earned my first allowance my dad encouraged me to track my money: save some, spend some, and give some to others. The money from my first paper route went, in part, to helping others. Shannon and I, every year we’ve been married, do the same exercise together. We map out the causes that are important to us, and we plan how much can we give to those causes each year.
I hope that as our financial health strengthens as a family, we can focus more on giving and less on self. This will be a gradual shift as our lives and careers evolve, our kids head off on their own, and with luck, our savings grow. No matter where we are on our journey, I know we’ll always care about spending and doing so deliberately.