What would it take for your finances to get better?
I mean, you have a life, I have a life (although my friends may object…), we’re all going around doing more or less the best we can, and at every turn we are confronted with decisions that fall at the intersection of money, time, debt, values, priorities, hobbies, and people. Nothing is simple. We know we can do better, that the ways in which our finances interact with the rest of our lives could be healthier, but what would it take?
In 2012, if you were a stray dog or cat that ended up in an animal shelter, chances were really strong–in many cases well over 50%, in a few cases almost 90%–that you wouldn’t make it out. As hard as it was (and is) to be a stray dog or cat in the wild, maybe especially in an urban context, you’d almost rather take your chances than be caught by someone from animal control.
But now? It’s a much different, a much more hopeful story for stray dogs and cats (and bunnies and others). As this amazing New York Times article spelled out earlier this week, the rate of euthanasia at animal shelters has fallen dramatically in the last ten years. Which begs the question, How?
What did it take for it to get better?
I would highly recommend you read the piece–especially if you’re an animal lover–but as I read it, I think it took three things to reduce animal euthanasia: Data, Cooperation, and Sacrifice. And if we’re wondering what it would take for our finances to get better, I think we should start with those three things, too.
Data. In order to solve any problem (or even to make a marginal improvement in a decent situation), you have to first get a grasp of what is actually going on right now. So the first step in cities tackling the problem of pet euthanasia was to gather and then pay attention to the data. How many animals are on the streets, how many come into shelters, what happens to them when they get there, how are we advertising for adoptions, and how successful are those advertisements?
For those of us attempting to improve our finances, it’s no different. We have to start with a clear-eyed understanding of where we stand today. How are we spending, saving, and giving our money today? How is our 401(k) invested? What sort of insurance coverages do we have? Have our estate documents been kept up to date? How are our relationships with spouse, kids, grandkids, parents, friends and whoever else when it comes to money? Why is money important to us to being with? This can be a tough stage, because we’re not yet taking any real “action steps,” and what’s more, we may even feel shame or want to blame others if the data we gather is not what we want to see. But flee from that temptation! As you’ll soon see, it’s essential in this step (and going forward) that you put on your No Shame, No Blame hat, and as this is the first step toward getting better, it’s the most important one.
Cooperation. Once cities and shelters had a better grasp on the reality of their stray pet populations and some of the moving pieces relating thereto, they realized nothing was going to get done without cooperation between various agencies and stakeholders. It had to be a community effort. And it was! There was cooperation horizontally between animal shelters of different cities to standardize data and increase the professionalism of their work; there was cooperation vertically between city governments, shelters, non-profits, and individual activists to fight for something better. And all of this lead to a cultural shift that coincided with better tools for solving the problem.
Finances are not a “by yourself” sort of thing. Now, to be clear, I don’t know of much of anything in life worth doing that is, but finances certainly are not. No matter what your marital status is, no matter whether there are children in your home, no matter how good you are at thinking about numbers and money, we are relational beings, and we need each other to get better at managing our finances. From personal relationships where we’re talking to friends and family about values and priorities and dreams, to professional relationships where we’re relying on CPAs and attorneys and financial planners to provide expertise and service, there needs to be open dialogue and a communal effort to make strides. The pleasant and often surprising upside to this is that not only is a cooperative effort more effective, but it’s also more enjoyable.
Sacrifice. You know what? At the end of the day, for euthanasia rates to plummet in shelters around the country, a whole bunch of people had to rescue dogs and cats and bunnies and commit to taking care of them as family pets. And no matter how you slice it, pets are hard work. They require sacrifice. But because of the hard work that had been done in the Data and Cooperation steps, there was a huge cultural shift in the way people viewed pets, so that they began to see that sacrifice as a small price to pay for the delight of rescuing and welcoming in animals to their homes.
When it comes to our finances, we might like to pretend that we can get around sacrifice, or defer it, or out-earn it. But we are constantly making sacrifices, whether actively or passively, and it simply remains to us to make the sacrifices for the things we actually value rather than those we do not. We can actively choose to sacrifice lifestyle for the sake of generosity, or we can passively sacrifice our impact through lifestyle creep. We can actively choose to sacrifice time in the office (and the income that extra time brings) for the sake of time with family, or we can passively sacrifice most of the good stuff and only realize it once it’s too late. We can actively save and invest for a period later in life where we can pursue a different line of work or a hobby or extensive travel, or we can passively defer those goals until they are no longer reachable. You see, the sacrifices are getting made either way. It just generally behooves us to be intentional about which ones we’re making.
Data, Cooperation, and Sacrifice. These three steps, repeated over and over again, are the basis of the financial planning process, and they are what it takes for anyone’s finances to get better. You’ve got to start somewhere, you can’t do it alone, and waiting is a passive sacrifice I would not recommend.