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March 2014 Newsletter: Help the Needy and Economic Preparedness
March 21, 2014
Hello to all my frugal friends:

We're itching for spring here in Wyoming. We've already had quite a melt of the snow and lots of mud. I'm sure we have more winter ahead, but we're already moving along on restocking our chicken yard, starting seeds, and making lists for summer projects.

You might be wondering why I chose a photo of me up in the air in a "cherry picker" for this month's newsletter. Well, I'm riding high these days as my foreign travel has come to an end, my tax return is finished, I'm getting my office straightened out, the newsletter is going out on time again, and I'm looking forward to my annual spring fishing trip next month. I'm not feeling above the clouds, but I'm up in them somewhere.

This month I want to provide you with two articles that you won't find on the site. As promised, the first article discusses my approach to charitable giving. It's a difficult thing for many of us when we see people begging for money or holding signs that read, "Will work for food." My approach might not match up with yours, but I hope to give you something to think about.

The second article is #2 in roughly a 40-part series on economic and financial preparedness. In this article, I want to introduce the first of three main ideas for being better prepared in our economy and from a financial standpoint: creating wealth. The next two articles in the series will discuss preserving wealth and making good use of it. After that, we'll start examining details in these three areas.

So, let's jump in.

Help the Needy – Not so Fast! Let’s do Some Thinking

by Clair A. Schwan

“Help the needy” is what we’ve learned since we were kids. But some people simply take advantage of the good nature of others, and that can cause us to rethink that well-worn expression. Who are the needy anyway? Sometimes it’s hard to figure out. And, that’s what can lead us to donate to a cause, lend money, forgive debts, and help others who have projected themselves to us as being in need.

There’s nothing wrong with helping the needy. It’s a great thing, but caution is advised, especially if it places us at undue financial risk. Remember, only we should be making decisions about what we choose to afford.

What I’d like to suggest is that we reassess the issue of someone else being in need, and how we might respond to that. I’d also like to suggest a mindset that can help us respond to others who seem to have an insatiable appetite for financial assistance.

Who are the Needy?

To begin with, aren’t we all needy to some extent? Most of us have probably never spent much time without being mindful of a particular need we have. To be sure, some people appear to have much more need than others, and some are constantly in need of just about everything.

As I see it, the problem is that we’re inappropriately fixated on need – on both sides of the issue. Often we turn a blind eye to most other considerations. Why is that? I think it’s simply because having and displaying a need is what gets attention. It can be displayed as something highly emotional. Anguish, frustration, fear and despair are definitely among the “attention-getters” in life, whether it’s our life or someone else’s. It’s also because having and responding to needs is politically correct. Perhaps it’s time for some of us to get out our spray can of politically correct repellant and be ready to use it.

The idea of need is quite a trigger point for many of us, but is the outward appearance of need the only criterion available to us? Is it the only way to make a decision with respect to lending money, providing a donation, giving to a beggar, providing a helping hand, or allowing the tax man to dig ever deeper into our pockets? Should those who demonstrate great need and a sense of urgency get substantial and immediate financial assistance? I think not.

Who are the Worthy?

My considerable experience suggests that the most important criterion for charitable giving is worthiness. I believe we ought to be supporting and helping those who are worthy of our support, and have a need for it too. And, some folks just aren’t worthy of our support. They simply don’t deserve it.

Oh no! Here comes a guy waving a big red protest flag in your face. And, lots of people in the audience are standing up and doing their best to boo and shout me down. Listen to what they’re saying: “What an insensitive and judgmental person he turned out to be! Let’s take him out back and kick the crap out of him. I can’t think of anyone who deserves it more. Talk about worthy and deserving, he deserves a good ass-kicking!”

As you can see by audience reaction, determining worthiness can be quite disconcerting. It’s all because if we determine someone’s worthiness, then we’re being judgmental. Many would argue that being judgmental isn’t the way we should be. It’s a bad thing. It’s wrong to imply that one human being is, relatively speaking, not as worthy as another, and therefore doesn’t deserve our support. I think otherwise, and act accordingly.

You be the Judge

I believe being judgmental can be a good thing, especially when we’re using good judgment when it comes to determining the worthiness of an individual. After all, if we aren’t supporting worthiness, then we’re encouraging the opposite. We’re encouraging behavior that is not honorable, not respectable, not important, and not valuable. In other words, we’re encouraging poor choices and irresponsible behavior. We’re fostering the failure of others. That’s not something I wish to encourage, enable, promote or condone. I’ve been there and done that. I’m not ever doing it again.

And, if you think being judgmental is wrong, then how is it we’re suppose to be fully capable of recognizing a “need” (which is a type of judgment) but we’re somehow supposed to be incapable of making a similar judgment when it comes to worthiness? I don’t get it. Recognizing one is just as judgmental as recognizing the other. For example, I can judge that a person truly has a need (not just a desire) and they’re worthy of my support (they’ve earned it, they’re a good risk, and I want to encourage their efforts).

Besides, haven’t we all heard about those “worthy causes” around the holidays? If a cause can be worthy, then a “good cause” associated with a person can be deemed worthy as well. And, we ought to make those kind of determinations before handing over the financial resources we've worked so hard to earn. Now, that makes sense to me.

What I’m suggesting is that we look at need, but very carefully consider worthiness (goodness, importance, respectability, esteem, value, merit, honor) before acting. The reason is quite simple; anything we do either encourages or discourages behavior. We should be encouraging responsible behavior that we want to see repeated.

Who is Insensitive?

I’ve been accused of being insensitive and having ice run through my veins. Perhaps, but isn’t that ice flow attributable to the sum of my experiences? I sure think it is. Despite all the ice in my veins, I’ve done plenty, and continue to do plenty for those in need who are worthy of my help. I’m not sitting in the cheap seats. I’m the voice of experience. And, if the truth were known, we’d see that those who have accused me of having ice running through my veins are the same ones who previously abused my good nature and generosity.

Those throwing tomatoes are largely upset because I won’t be abused anymore, not for a minute. They’re a bit like people you've probably encountered in your life...they do you wrong, you call them on it, and then suddenly they accuse you of being the bad guy simply because you won't put up with their crap. It doesn't make any sense until you realize it's a defense mechanism that allows them to live with themselves despite being the bad guy who started the problem in the first place. As I've learned, ungratefulness is often a companion of irresponsibility simply because showing appreciation by word and deed would be the responsible thing to do, and the person’s irresponsibility is likely why they’re in a jam to begin with.

In my book, if you’re irresponsible, you’re unworthy. Change your behavior for the better, and your value goes up. It’s just that simple.

And for those who would characterize me as insensitive, let me tell you I’m not insensitive at all – just the opposite – I’m super sensitized. I’m super sensitized because of my experiences that have left me raw and therefore quite sensitive indeed to the many irresponsible people we have in our midst. I’m not usually one to point out the obvious, but sometimes it’s easily overlooked – the irresponsible among us are perhaps the most insensitive, especially regarding what their behavior does to the financial condition of others.

Develop a Mindset

If I could sum up my thoughts in a single sentence, one that you might retain as a way of thinking of these things, it would be: People can only take advantage of you to the extent that you allow them to. And, allowing someone to take advantage of you is tantamount to encouraging, promoting, and condoning their irresponsible behavior. Expectations need to be set upfront, otherwise, the expectations of your beneficiaries will start to take hold. Remember, when you feed a stray dog, it’ll likely come back – that’s because of the dog’s expectation that it will be fed again and again.

Many years ago I created a technique for addressing difficult issues. My technique is a three-step process of thinking things through; first use your head, then use your heart, and then go back and use your head again. It’s a good approach anytime you’re dealing with emotionally charged issues of significance in your life. It’s also great for just about any other kind of decision you need to make. It puts reason over emotion, takes into consideration the human side of things, and forces you to reapply rational thought before giving your “final answer” to Regis or Meredith.

Reassess Your Giving Nature

Giving money and support and assistance to those in need is a great thing. When we engage in charity, we show everyone around us our “signature.” So, let’s show off our wonderful signature, but perhaps we should be more circumspect when it comes to those who whine about their needs. Let’s take a good look at their signature and what it tells us about them. Are they worthy of our support? Do they deserve it? Should we promote and encourage their behavior?

Try that the next time you’re faced with someone who pleads for your hard-earned money. You might decide to do what I do when they’re unworthy; offer up a little cheese to go with that whine.

Economic and Financial Preparedness – Creating Wealth, The First Step

by Clair A. Schwan

In the first part of this series, I introduced the idea of economic and financial preparedness. For better or worse, I defined finances as personal money matters largely controlled by the individual, while the economy was defined as the marketplace for earning a living and obtaining goods, services, materials, food and other items...largely outside the direct control of the individual.

I also introduced the analogy of a financial and economic milking stool with three legs: 1) creation of wealth; 2) preservation of wealth; and, 3) making good use of wealth.

In this part of the series, I’ll highlight some general suggestions for how one might be better prepared by building the first leg of our milking stool, creation of wealth. The idea is to take action such that changes in personal finances or our market economy won’t necessarily put you into a tail spin or leave you scrambling because you’ll be in a better position with respect to how you’re creating income and building wealth. To me, this is a logical starting point. In subsequent articles I’ll address preserving wealth and then making good use of it.

So, let’s look at the first leg of our financial and economic milking stool, and review some basic ideas for being better prepared. To simplify matters, I’ll associate suggestions with only one leg of the milking stool, although many suggestions could clearly be part of more than one leg. As an example, acquiring tools for a trade is a way to get into business for yourself and create wealth, the first leg of the stool. It’s also a good use of your money, the third leg of the stool. I’m associating the activity with creating wealth because it’s more a means of earning money, and less important as a way to make good use of your money.

Creating Wealth

It makes sense that our first step be creating wealth. In order to do this, we need to invest our time and money to further our interests in earning money that we can turn into wealth. Here are basic ideas for how one might do this, roughly in the order that I would suggest they be considered:

  • Challenge yourself to rise up through the ranks – taking on more responsibility at work and demonstrating good performance and leadership on the job. All of this can lead to promotions and higher levels of income. A higher level of income is one half of the equation when it comes to building wealth (earn more and spend less).
  • Become skilled and knowledgeable for upward and lateral mobility – in the absence of taking the management route up the employment ladder, one can take the technical route and become a specialist.
  • Start your own enterprise – perhaps the best alternative for better control of your destiny and much higher levels of income. Many can do this right now based on what they already have on-hand and their current base of knowledge and experience.
  • Acquire knowledge and tools for a skilled trade – a type of investment in resources beyond what you currently have, all for creating money in a business of your own.
  • Make financial investments – the old “make money work for you” concept. It’s great to have a big pile of cash, but it can be directed towards earning money for you by allowing others to use it. It’s a way to multiply your efforts without additional hands-on work on your part.
  • Create multiple revenue streams – many of us have only one source of income outside of investments, and sometimes that’s a bit like having all your eggs in one basket. Moonlighting as an employee or having a sideline business are two ways of creating multiple revenue streams that increase your wealth and help provide protection against complete loss of income.
So, there are many and varied ways to create wealth as one leg of the financial and economic milking stool, and it’s the logical place to start. Without wealth, you have nothing to preserve and nothing to spend.

The Road Ahead

My suggestion is to start thinking about some of the general ideas presented above, and generate additional ideas of your own. No matter what course of action you might take, or none at all, it makes sense to first do some thinking. We surely live in a changing environment that poses risks and challenges for even the best money makers and managers among us, and that alone should be motivation enough to get our wheels turning. In future articles, I’ll take each of these general ideas, one at a time, and provide details as to what one might do in terms of implementation.

Next month, let’s look at general ways we might preserve the wealth we’ve created.

Up Next

I'll continue to provide more articles that I think are of interest to those with a frugal mindset, and at least one of the articles will be a continuation in the economic and financial preparedness series.

Next month, I'm planning to provide an article about the financial adage, "It all adds up" and I'll provide the third article in the economic and financial preparedness series that focuses on the second leg of the financial milking stool: preserving wealth.

Thanks for being along for the ride here at Frugal Living Freedom. It is my hope that you enjoy the articles in the newsletter and get an idea or two from them. I hope I give you a valuable perspective or insight along the way...possibly something to act on.

I wish you all the best,


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