41–Lever #4: Interest Earned (Part Two—Saving is a Verb)
It starts with sacrifice not spreadsheets
In the previous article, we learned that saving is not prohibited in Scripture and is actually encouraged when done out of a heart that is rightly related to God and guided by biblical principles.
We’ve also discussed how your interest earned (IE) is an integral part of your financial life equation (FLE), particularly as it relates to growing your future wealth (or net worth, if you prefer). You may recall that when we first examined the financial life equation (FLE), I mentioned that savings is what you have left after you've done everything else (consumed, given, paid taxes, paid interest, etc.). So, in that sense, you don’t first “save”; you steward your resources wisely so that you have some financial margin. Then you can deposit some of your financial resources into a savings or retirement account.
That’s why understanding the FLE and how its different components relate to each other is so essential. You need an income (duh!). And you need to know how to leverage the U.S. tax code to your benefit (to the extent it can be legally). You also need to understand the debilitating effects of inflation over time. And you need an emergency fund, a budget to manage your day-to-day expenses, and a plan for the unexpected to avoid debt.
Increasing “interest earned” (IE) begins with saving, but that’s not the whole picture. When most people think about saving for something, they think about a numerical goal, perhaps because of something they’ve heard or read:
“Save 6 months of salary in an emergency fund.”
“Save 15% of your income for retirement.”
“Get to a million dollars to retire.”
And so on. . .
However, consider saving in a broader context. What if it isn’t just about how much to save (what to do) but also what you must give up (or not do) to do so?
The discipline of saving is less about spreadsheets and targets and more about tradeoffs, tensions, and sacrifice. In that way, it’s a lot like giving, but in reverse. To give generously, we sacrifice spending on ourselves so that others (and I’m using the term others broadly) can spend what we didn’t. To save, we also sacrifice spending in the present so that our future selves can spend it in the future.
Economics teaches us that life is a series of tradeoffs regarding what we choose to do with the resources we have been given. This concept is based on the idea of “opportunity cost,” which refers to the loss of potential gain from other alternatives when one option is chosen over another. Applied to money, it means that funds used for one purpose can’t be used for something else.
Every single day, our life is driven by the opportunity costs of past, present, and future decisions. While we're not always conscious of it, opportunity costs are at the core of almost every decision that we make. Decisions themselves are quite literally the point where we choose one path over another.
Most of us want more of certain things: more time, more money, more stuff, more security. Even minimalists want greater simplicity and serenity. But we can’t have it all, even if we aim to live as minimally as possible. Absent unlimited resources, we must choose. And that’s what saving is. It’s not just socking away money to reach a goal but a deliberate choice to spend less today so you can spend more later. You make a similar choice when you give, but out of a heart motive to bless others.
Saving is a verb; savings is a noun. One is an action (a decision and a behavior); the other is a result (an account balance). So, this is where we begin: exercising the discipline to save early and often by forgoing spending (consumption) now so that we will have those resources at our disposal later when we need them.
Saving is proactive; it anticipates future needs while accepting the uncertainty that comes with them. You save for future emergencies or retirement, but also for freedom and flexibility. When you have margin, you can respond to both opportunities and challenges more freely. That might mean giving more, helping a friend or relative, or even stepping away from work for a season to care for a family member.
Saving gives you options. In contrast, living paycheck to paycheck, with high debt, even on a high income, locks you into financial inflexibility and anxiety. Saving gives you the ability to say “yes” in situations that really matter. If you have a lot of consumer debt, it’s good to save up a small emergency fund, but then turn your attention to the debt before you save a lot more. It’s self-defeating to save while also carrying a large amount of high-interest debt.
Saving is a radical act in a culture driven by consumption. As I discussed in an earlier article, you live in a “consumption culture.” You’re constantly bombarded with messages to “treat yourself,” “upgrade,” or “live your best life now.” But biblical stewardship calls you to something different: delayed gratification, wise planning, and trust in God’s provision. Saving doesn’t mean you can’t enjoy life in the here and now; it means enjoying it wisely while also planning for future needs.
Saving enables you to invest. We grow IE by saving and investing. But before you decide where and how to invest, you may want to first think about what specifically you are saving and investing for. I’ll tackle that in the following article.
For reflection: Saving is often viewed as a financial strategy, and there is a sense in which it is. However, Christians should view it as a spiritual discipline that is part of wise stewardship, rather than something outside of it. It reflects wisdom, foresight, and values planning over impulse and indulgence. Just as giving flows from love and gratitude, saving flows from prudence and trust, as it is one way that God helps provide for us now and in the future. Saving can be one way that God provides for both today and tomorrow. How does the stewardship view of saving line up with yours? Do you think of it as a necessary sacrifice, taking into account the tradeoffs involved?
Verse: “Go to the ant, O sluggard; consider her ways, and be wise. Without having any chief, officer, or ruler, she prepares her bread in summer and gathers her food in harvest” (Proverbs 6:6-8, ESV).