When I was a kid, my buddies and I would get together and ride our bikes all the way across our neighborhood to the big church. And after playing around in the parking lot for a while, we’d take a break and step inside where there was a coke machine. We’d pull a quarter out of our pockets and buy an ice cold coke or sprint. Other times we would take the adventure to the next level and go further up the street and across a main road (hope my mother is not reading this) and go to the small grocery store and buy not only a coke but some candy to go with it. After finishing it we would fly back home on a sugar fueled power high, pedaling as fast as we could. If we had the money to buy that coke and candy we were rich, if not we felt poor. Back then, that was our definition of enough.
In high school I had a part time job working at Radio Shack. Back then in 1987 the minimum wage was around $4. (Somewhere there is a millennial reading this thinking to themselves “I was not born in 1987… and what is a radio?”). So, my 20 hour a week part time job got me around 80 to 100 dollars a week before taxes. When I got my paycheck every two weeks and there were three whole number in front of the decimal point, I felt like a rich man.
Well, high school is long behind me, along with the 80’s. And as time has gone by the amount I seemed to require to make me feel OK financially has grown with the times. As I have been working to pay off debts and to save money for both a rainy day and retirement, I found myself recently thinking about what amount I felt I would require today to feel OK. As I thought of that answer, the idea of a new “Zero” came to mind. What amount would I need to have on reserve so that if I was above that amount I would feel confident, and if I dropped below that amount I would be concerned. To my surprise the number that immediately came to mind was larger than I thought. $100K the little bike riding kid in me whispered in my ear and I could see the slightly geekier version of me standing in the middle of a Radio Shack with his cheap tie on smiling and shacking his head in agreement.
Reserve. That is a good word for it. When I was a kid I had a three wheeler that had a small reserve gas tank with just enough fuel to get me home if the main tank ran dry. If that happened, I just turned a switch and was back in business. When planes fly from one city to another, the ground crew doesn’t put just enough fuel in the plane to just get them there. They go beyond that and add an extra amount just in case the plane has to circle the airport waiting to be cleared for landing or maybe has to be redirected to land in a different city due to bad weather.
What amount would you need to have on reserve to feel confident that you would be able to make it through a bad financial storm and still make it to the runway and land safely? $100K? $50K? Whatever the amount your 13 year old self whispers in your ear, get to work on saving that. Once you have it, you will have a sense of piece that just isn’t there when you don’t. I am very close to my new Zero, and already I can see a big difference in my piece of mind where money is concerned.
Life is just better when you, and your inner child, know you have enough.