Newsletter #46 on financial life in the negative world drew a lot of Masculinist reader feedback and suggestions from others. These are their own, and I’m passing them along as is and largely without editorial comment.
Reader Devin notes that back in the 1970s, you could early a decent interest rate on a passbook savings account, whereas today interest rates are effectively at zero. I definitely remember getting over 4% interest on my savings account as a kid. Of course, inflation rates were higher (at least in the 1970s), but inflation is still significantly higher than interest rates today.
Reader Matt shares some of his suggestions:
1. Baseline liquid savings for economic security should be 1 year’s worth of cash burn. This isn’t all savings but liquid savings (i.e. not home equity you’d have to borrow against). The dollar amount is a function of your lifestyle choice. Until you’ve gotten there, reaching it should be your primary financial goal and be a top-4 organizing principle of your life. It also sets a clear, psychologically defensible threshold for managing your lifestyle ratchet: if you’re moving into a more expensive apartment, you simultaneously raise your liquid savings minimum, which gives you an alternate (and better) metric as to whether you can afford it.
One year reflects the realities of employment: Especially in professional class life, the more you make, the longer it will take to find a good fit for the next job. This isn’t just about being ‘picky’ but a reflection that making good money is usually because you’ve developed specialized, niche skills or knowledge whose market is only so big. And as you wrote, there’s no guarantee you’ll find the good fit or that your niche won’t get vaporized, and you may have to take a step down when finding a semi-fit that’s adjacent to what you’re best at.
One year’s worth sounds like a lot (and is), but even if you’re starting from zero at the outset of your career in your 20s you can get there in 5-6 years
2. At least once a year (and better, once a quarter), go through all your habitual expenses and decide in advance which you would or could cut in the event of unemployment. Make it a ritual with a set block of time. This both helps in setting how much liquid saving you really need (pt 1 above) and also will help you recognize wasteful expenses you can cut anyway. It will also help substantially with the psychological issues surrounding economic security: it’s much easier to psychologically manage that kind of anxiety when you have a plan in place for it. It will also alert you to when you’ve got not enough saved, or when your burn rate is too high, while you’ve got the time and space to adjust
3. Saving is like tithing: if you just live your default lifestyle and save what’s left over, you will never get to 10%. Set your saving (and giving!) goals first, formalize it into automatic activity, and then adjust your lifestyle to what’s left. FIRE is an extreme application of this principle, but it works just as well when you set a 15-20 ish% for a savings rate goal, which a lot a people could manage without being reduced to ramen-for-dinner-every-night. Unless one possesses exceptional self-discipline, one’s spending habits are like Boyle’s law and will expand to the space allotted. The only way to keep them contained is to allot them less space.
It’s also psychologically easiest to ratchet up your saving and giving immediately when you get a raise. In my 20s I set and maintained a rule for myself that anytime my income went up structurally, of the incremental amount I’d devote 25% to increased savings, 25% to increased giving, and keep only 50% as ordinary lifestyle spend. Of lump-sum events (bonus, tax refund, etc) I’d give 10%, spend 10%, and save 80. Both rules I’d highly recommend, and if set early in a career will put one on a path to being wholly comfortable with a lifestyle compatible with both economic security and Christian charity.
4. Cultivate a side hustle, especially if you’re a single man. Unless one is in a small number of very high-octane fields (finance, big law, medical residency) or has abnormally high family care obligations one almost certainly has the time for this at some margin. It doesn’t have to make much or really any money on net, just be a hobby with a tiny bit of revenue.
The money is not the point; the ancillary benefits are: a) it’s by far the easiest way to adjust a lot of non-primary-work hours from being cashflow negative to cashflow neutral-to-positive. The avoided cost of what else you’d be doing with that time are often reason alone to do it. b) it expands your contacts and social connections beyond (and often orthogonal to) your primary family, work, church, and existing-friends circles. This is especially valuable for men who struggle with establishing social connections or feel generally alienated from institutions. c) it is a great outlet for periods when your regular job feels stagnant, unrewarding, or otherwise unpleasant. It helps contain negative experiences at work and keeps them from becoming life-consuming. Related, it also limits the career-idolatry to which professional class people are prone by being a regular reminder that there are other means of being productive and that the primary job does not need to be identity-consuming. d) It could possibly blossom into a meaningful 2nd income or even a full-fledged career change. A huge proportion of small businesses start this way. Heck, that basically describes your experience with The Masculinist.
Reader Eric writes:
I’ve been thinking for several years about this exact subject both for Christians and the culture at large. Typically for me I frame it positively e.g. how do I have more time to minister to other people rather than how do I survive being canceled. The FIRE concept is definitely one of options. The problem I see is that basically you have to get a job that pays very well (usually a tech job) then have to discipline to maintain this very strict lifestyle for 10 years often delaying having children until after that “retirement”. I think this can work for a certain segment of people (engineers and accountants seem to excel at this) but it is a poor fit for many people. The other issue is that you have to focus on your career until your mid-30s or later typically and then you have time for ministry discipleship etc.
Another option out there is the Tim Ferris approach, often called lifestyle design. This basically involves setting up a highly automated online business usually based around some expertise you have developed or unique product you have designed. Again this much easier said than done. I’ve actually thought about teaching both of these perspectives as part of course for young Christian men to help walk guys through this.
A third option is looking for jobs that are more shift based. These include nursing or firefighting or my current job as a medevac pilot. Since I fly fixed wing, not helicopters, I’m based at my house and on my two weeks on I’ll do usually one 5-8 hour mission per day. Then I have two weeks completely off. I intentionally chose this part of aviation because of the lifestyle rather than higher paying, higher prestige airline track. Right now I’m very glad I did because many airline guys don’t have a job right now.
The advantage I see to choosing a track like firefighting or other shift based work is that it allows you to build time and experience to implement one or both of the other strategies. Many firefighters in particular use their firefighting salary as a base and then have a part time business. You could then live off only your firefighter salary and save your income from the business thereby implementing a FIRE strategy.
Reader Nick had this to say:
This is an area I have given a good amount of thought to – what would the “church” be able to accomplish if it wasn’t for the excess living and debt of the congregants. I think the answer is – a lot! As my own income has increased over the years, our expenses have stayed very steady and we have managed to begin to save a decent chunk of money. However, one of the biggest benefits we have seen is that we can give a lot more away. While my business has been blessed to continue to thrive during this crazy year, I know many folks who haven’t. So, we have been able to help those people with cash to get them through the hard times. Living frugally = giving generously. All that to say – imagine a church of 50 families where everyone had $10-20k extra to give away every year (even after their tithes) because they just don’t need it. The cup overfloweth. That is some serious capital to help those in need and invest in communities! But alas… not quite what we see in reality, especially with how people (and especially pastors) like to live these days.
A couple of Masculinist readers also run a site/program called Abraham’s Wallet, which appears to use Biblical principles to inform the household economy. I haven’t used the program myself, but you may want to check it out.
And the Guardian (UK), a left-wing British newspaper, just wrote a profile of Dave Ramsey. Ramsey’s style doesn’t resonate with me, but obviously, a lot of people do and even his critics conceded that his financial advice is overwhelmingly correct.