Happy Sunday! On this day of rest, I’m really reflecting on the role money has in our lives. I see a lot of financial suffering with some of my clients (and in the world in general), and it got me thinking about our fundamental beliefs about money.
There’s lots of tricks, apps, blog posts, articles, etc about interesting ways to make money, to grow money and to consume money. But there is sage wisdom about how to view money that fundamentally starts with the lesson behind the three jars. Many early financial education/mentoring programs use a basic rule that you should divide your income into three jars – the one you give away, the one you save and the one you use. Why is this basic lesson so important to financial health? It gives us a different, and I believe the proper, perspective on money and its role in our lives.
GIVE: choose a percentage or dollar amount of your paycheck to give away before you do anything else with your money. Giving away money creates a mental and physical break on the grip of money may have on your life. When you first use your money to help others you are setting a priority that says you recognize that however bad-off you you may be feeling financially, you have enough to contribute to some thing or someone that has a greater need. You don’t have to give to a church or a qualified charitable organization for tax purposes. You can start by saying that from each check I will buy a $20 gift card to give to a homeless person, or a neighbor who may have lost their job or spouse, or someone at work who is having a tough time. You can also just do it as a random act of kindness. The point is that you break the shackles that money often has on you by giving it away.
SAVE: choose a percentage or dollar amount that you will put into savings or investments from each paycheck. Savings fulfill two purposes – it provides a financial source to take care of you in emergencies so others aren’t required to, and it provides relief and therefore choices about how you live your life. You don’t have to feel stuck in a job you hate, or give up a business opportunity you’ve always dreamed of. You can create the lifestyle that brings joy rather than fear because you are not a prisoner of a situation that is primarily about living paycheck to paycheck. And if others do not have to worry about you, that frees their resources up to help someone else.
LIVE: enjoy the fruits of your labors and spend what you have left. There is always a smaller house, less expensive clothes and other options that may make more sense. When we learn to live on what is left we learn to value our time and finances. We make better choices. Our ideas put money into its proper role so we learn to tame our desires and manage our needs.
It all sounds so very elementary and maybe a little bit preachy, but how many of us are living in the opposite order? We consume, and if there’s any left we save and then finally … maybe give? Far too often that means living above our means, stuck in jobs we hate, unable to stay home with the kids (if we want), unable to go on the vacations we want, unable to contribute our time if we want. We can have both – joy and money, – but we need to make money our servant and not the our master.
If you need help finding ways to implement the Three Jars method into your life, you can always reach out to us or leave us a comment.
We’ll chat again soon!