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EDITOR'S NOTE: The following is George Bailey's weekly report "Meanwhile, Back at the Ranch" about his and his wife's efforts to teach their kids financial freedom.
Dave Blanchard had a lot of great feedback on raising children during this last week's podcast episode. One in particular that jumped out to me and that has been on my mind this past week is the question of how much money is enough for a family. Dave calls this amount your "enough."
It's important to find your enough because that's the point at which you can enjoy the fruits of your labor. Once you've determined that amount, you can make an even greater effort to give to those in need. Your money becomes a tool with which you can now lighten the burdens of others. People who don't determine their enough will find themselves ever reaching for more material goods and always feeling empty.
I tend to think that there's truth in what Dave is saying. Certainly, research backs up the notion that there's a point at which an increasing income stops adding happiness. If I have any reservations, it's only because I'm slow to draw conclusions until I've applied something in my own life and found it to be consistently nourishing and enlightening. At face value, Dave's idea has all the hallmarks of that kind of truth.
Now my family and I need to determine our enough. Here are a few factors we should apply in doing so:
Given the size of our family, how large of a home do we need? My wife and I love cooking together. Does that justify our dream of living with something other than our current galley kitchen? What about my desire to have a flat backyard where I can throw the ball around? What would such a home cost?
Christina and I rarely go out for our dates. How positively would it affect our relationship to be able to get out of the house more often while leaving the children behind with a babysitter? How much more money would we have to be making to make those outings more possible?
In terms of vacation, what type of budget would Christina and I be setting aside to plan trips that optimize our quality of family time? How often should we have vacation time as a family?
What about gifts? The type of cars we drive? Personal hobbies? Extracurricular activities for the children? Our clothing? All of these things affect our happiness to one degree or another. At what point does money become effective at maximizing our happiness? When does it get out of control? When is it really just a matter of keeping up with or ahead of the Joneses?
In asking all these questions, I recognize that throughout the world there are people asking even more basic questions about mere survival on a day-to-day basis. I'm grateful for all that I have and am not asking these questions out of a desire for material possessions. Rather, knowing that number at which I can be at peace financially helps me to clarify my professional goals as I seek to provide more effectively for my family. It also helps me to identify the point at which I can devote a greater portion of my income to improving the lives of others.
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