In May of 2012 I was wrapping up a five-month national tour of a children’s show and bracing myself for unemployment.
About four weeks away from our final performance, I noticed an upcoming day off on the schedule. Determined to pad my savings as much as possible before returning home, I hopped onto Craigslist and sifted through the usual spam to find some local work for the day.
Success. Our off-day hotel was located on the outskirts of Seattle and I’d stumbled across a military conference happening just downtown. They were looking for babysitters to watch service member’s children during the conference. A few emails later, I was booked as a sitter for a full fourteen-hour day – great news for my bank account!
I google mapped the bus route from our Days Inn in suburbia to the downtown conference area and got up bright and early the next morning to make the journey. Just before 6, I got on the bus and fed a $20 bill into the fare machine, expectantly waiting for my change when the bus driver turned to me and snapped, “I hope you’re not waiting for any change.”
I looked back at him confused. He pointed to a sign well above my line of vision – Exact change only it read.
“But I put $20 in!” I exclaimed in distress.
I took my seat on the bus feeling utterly defeated, tears silently streaming down my face as I rode into town. I’d lost over an hours’ worth of my day’s earnings just because of that stupid mistake.
In hindsight, I’m grateful for the pain of that experience and others like it. Having grown up with great privilege in childhood, my years of being broke served to ground my understanding of cost and value in the real world.
I hadn’t been raised in such a way that I was ever a spend thrift, but supported such that I had developed habits like breakfast and lunch on the go and regular Starbucks runs. Though seemingly insignificant from my place of privilege, the costs of these mindless purchases in my broke years quickly shifted from inexpensive convenience to additional hours working my dreaded survival job.
Because the impact of a $20 loss could (and sometimes did) induce tears, it allowed me to appreciate the significance of every monetary amount, and, more importantly, understand the value of mindful spending and budgeting.
There’s a school of personal finance philosophy that preaches “big wins”- focusing on habits and behaviors that serve to significantly increase your bottom line, as opposed to expending effort on small savings strategies – like curbing your daily coffee habit or avoiding public transit fails.
I’m a fan of the big win philosophy. Concentrating efforts on changes like raising your credit score to qualify for better interest rates or asking for a raise, can pay major, long-term dividends.
That said, I don’t know that I’ll ever dismiss the value of curbing small, habitual purchase patterns.
In a column for Forbes last week, Garrett Gunderson laid out his own version of the big win philosophy, suggesting the use of “value-based spending” as opposed to budgeting which, according to Gunderson, promotes a scarcity-mindset.
While scarcity certainly prompted my need for budgeting, the practice of budgeting itself is was what gave me the fiscal foundation from which I was able to build an abundant life.
Budgeting is a value-based spending plan distilled down to numbers. Setting concrete benchmarks and tracking pennies spent provides the framework for creating the very freedom and abundance Gunderson preaches in his piece.
Dismissing the value of small savings and budgeting is like saying it doesn’t matter what you eat if you just keep exercising. It’s not an either/or proposition.
[tweetthis]Dismissing the value of small #savings is like saying it doesn’t matter what you eat if you just keep exercising…[/tweetthis]
Keeping close count of your pennies and internalizing the value of an amount as “insignificant” as $20 is not scarcity, it’s mindfulness – mindfulness that can be leveraged into creating powerful patterns of value based spending that, within the framework of a budget, facilitate the creation of a financially abundant future.
While I strongly support Gunderson’s call to action to expend energy on compounding big wins, let’s remember that small savings and big wins are not mutually exclusive, they’re complimentary.
[tweetthis]Small #savings and big wins are not mutually exclusive – they’re complimentary #personalfinance[/tweetthis]