Friday, November 16, 2012

The Savings Solution: A Conversation About Living Today While Saving for Tomorrow

The Savings Solution
By Michael B. Rubin

John Wesley, the founder of Methodism, once gave a sermon in which he said that Christians should earn all they can, save all they can and give all they can. So far, most Christians in the Western world have the first one down but they tend to stumble on the next two. The Savings Solution is about saving all you can.

Rubin emphasizes the need to save because the majority of Americans are living paycheck to paycheck. We are all victims of over consumption and keeping up with our neighbors. The sad thing is that we think if we could earn more money, we would not be living as we do. Rubin is convinced (and I believe him) that more income only makes us spend more rather than save.

The first thing he does is give stories about those who have options when life takes an unexpected turn. The people with options are those who have saved. Then he goes on to explain compound interest and how important it is to save as soon as you can -- the  younger the better. Next Rubin talks about how emotionally separated we have become from our money -- either because of credit cards or even debit cards. It is easier to spend if we don't see the money. When we see physical money leaving our hands, we have a harder time letting go!

Next we must be honest about our expenses. What do we really need as opposed to what we want? Rubin doesn't make those decisions for you but he does make you think. Then he focuses on lowering your needs on the big purchases; reducing daily spending is only a small portion of your spending. It is much more important to look at your monthly spending over your daily spending, according to Rubin. Later Rubin also talks about lowering your major spending (house, car) verses your minor spending (coffee, cleaning supplies). Rubin also encourages finding free stuff (like family time, inexpensive hobbies) and enjoying spending time with people you like. I also enjoyed his suggestions in saving on automatic monthly expenses like cell phones and ATM fees.

Rubin encourages spending on what you enjoy most (yeah!). He also suggests saving first (where have I heard that before?) which actually means saving from your first job and putting your raises into savings before you see them (on paper or in your hand). Although if you didn't do that, don't become discouraged: start saving where you are now! Most importantly, Rubin says to spend less than you make. Pretty obvious, right? Yet, how many of us actually do this? If you do, then you won't need to budget. In fact, Rubin discourages budgeting unless it is budgeting for saving.

That is a lot about the book. What does this book have to do with my faith? As I said before, Wesley encouraged saving yet many Christians do not save. Wesley also encouraged Christians to live on as little as possible in order to give money to those in need. I confess that I have not done so well on either account. When we get raises, we spend them rather than save them. We have a budget -- Rubin is right that it is a drag. But we have also gotten caught up in our culture's ways of over consumption. We don't have our priorities right. We have gotten rid of the credit cards but our debit card use is pretty substantial. Are we really living a Christian lifestyle? Are you?

I recommend this book but the "dialogue" part can become a bit immature and distracting at times. I think Rubin was trying to attract a younger readership.

Happy reading (and saving)!


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