As the sole provider and money manager for our family, I tend to think about money more than I should – are we spending too much, are we spending on the right things, are we saving enough, etc. I can’t manage our money like the government manages its money, nor would I ever want to. But our nation’s economic struggles have gotten me thinking about my own tiny role in our economy and my ability to stimulate it.
Finance and economics are a bit of a paradox to me. What’s good for me and my family financially – things like reducing/eliminating debt, saving for future purchases to pay cash rather than using credit, investing toward the boys’ college and our retirement, not buying stuff we don’t need – is generally bad for the economy as a whole, which depends heavily on consumer spending and debt to thrive. Similarly, when we save thousands of dollars each spring by taking advantage of the many tax credits and deductions that the IRS allows, we deprive the government of tax revenue that it could use in countless ways.
Money is the lifeblood of the economy and must flow from person to person, person to business, and business to business to keep the economy alive. When I give the local donut shop $5 for some donuts, that money might go to the local Sam’s Club where the owner buys her sugar and flour, and then to TXU Energy to keep the lights on at Sam’s, and then to the TXU billing support rep who answers questions about your bill, and then to Southwest Airlines when that rep needs to fly to Houston for a wedding, and then back to me.
The whole process fascinates me.
At times I’ve felt guilty about spending money on stuff for myself or my family, wondering whether we should have saved or given away that money instead. But I’ve come to realize something – spending money is another way to help people. I might not have Buffett-level cash that can jolt stock prices or bail out ailing companies, but the little money I do have to spend can still help to people working and put food on their tables.
I like the sound of that.