227 | Smoke Signals

Where there is smoke, there is fire.

And two smoke signals billow up at every level of financial wealth.

Cash on hand, or the Blue bar as the locals know it, is the first one.

No matter the net worth, the most content folks are those with enough cash to ignore their next paycheck and the ups and downs of their investments.

But the lower the cash goes, the hotter the embers burn.

Savings rate, or the Green bar, is the second one.

If you aren't saving,...

• You're living beyond your means,
• You're surprised by some unexpected things, or
• You're spending now to see some benefit later

It's OK to have seasons without saving, particularly if you started it with enough Blue, but if you keep poking the embers you eventually fan the flame.

If you’re getting that “things-feel-a-little-tight” vibe, look for the smoke and then work to put out the fire.

Extra Perspectives

You Aren’t Too Big To Fail (And That’s Okay) by Jared Korver