Lately, I’ve been listening to a wide variety of podcasts and talk radio stations while writing, mostly in order to expose myself to thoughts and opinions across the spectrum. A few days ago, a host on one of these shows (I believe it was Colin Cowherd) complained quite specifically about personal finance advice in a way that made me think.
His comment was simple: he claimed that personal finance writers and personalities target things like getting a latte at Starbucks because they’re low hanging fruit. He stated that if you just replace a Starbucks coffee with a lower quality coffee, you’ll save yourself maybe a buck a day, adding up to $30 after a month. That $30 is inconsequential, according to him – it’s an amount of money that really doesn’t equate to any significant change in life. Instead, he argued that you should only focus on the big stuff – sell that jet ski you use only twice a year, for one.
On one level, the host has a point: big steps will have much more impact than small steps. Selling that jet ski will help you quite a bit more than skipping a coffee at Starbucks, without a doubt. If you want to make a giant step, sell your car or downgrade your home – those moves will make a sea change in your personal finance situation.
On the other hand, we have a lot of opportunities in our lives to make small steps. Changing your coffee habits is a small step. Changing your light bulbs is a small step. Eating a meal at home is a small step.
In the end, though, big steps and small steps are just steps in a larger journey.
I like to think of the journey to financial independence as being like a marathon. Doing something big, like downgrading your home, is the equivalent of running a mile’s worth of that marathon. Doing something small, like giving up today’s coffee, is only a step in that journey.
The journey, though, is long. It’s a lot of steps to reach that finish line of complete financial independence. One or two big moves won’t do it, nor will a bunch of smaller moves. You need to throw as much as you can at the goal, just like a marathon runner throwing everything they have at the goal.
Many people like to overlook the small steps because they don’t seem to cover much ground along the way to financial independence. After all, giving up one’s daily coffee isn’t going to save you much money by itself, so why do it?
Here’s another way of looking at it. Skipping today’s coffee and putting that money away might be one step in the journey. Do it all month and you’ve got thirty steps. Do it all year and you’ve got three hundred and sixty steps. Add in a few other tiny things like eating at home and replacing your light bulbs and soon you’ll find that you’re taking a few thousand little steps – covering at least as much ground (if not more) than those big steps.
If you truly want financial independence and security, your journey is going to require some big steps and a lot of small steps. Don’t get caught up in the belief that a little step doesn’t matter – every step matters on your way to this marathon’s finish line.