Over the past several weeks, I endeavored to offer practical strategies to make affording a frum lifestyle more attainable and less stressful. The highlights included minimizing discretionary spending, relocating, and maximizing potential income. As a capstone to this series, let’s pull all the concepts together with a discussion of tradeoffs.
Tradeoffs exist in all aspects of life. We face constraints and have finite amounts of time or resources, so by choosing one thing we necessarily are diminishing or eliminating something else. The tradeoffs are generally not choices between right and wrong but decisions on how we’d like to live our lives. For example, I can decide to have a steak for dinner, but then I’ll need to forgo my milkshake after. That is a tradeoff between entrée and dessert. I can spend more hours a day working, but that means spending less time with my family. Similarly, a businessman may only have an hour a day to learn Torah. That hour can be spent either learning daf yomi or going to a shiur on the parsha. Both choices are good ones, it’s just a matter of how this individual chooses to spend his time.
Naturally, tradeoffs come up with our personal finances as well. With a finite income stream, all spending decisions are a tradeoff between expenses, savings and investments. An individual can decide to lease a luxury vehicle, but a portion of that monthly car payment could have been saved in a retirement account and invested towards his financial future had he leased a less expensive car.
When deciding where to live, there may be a tradeoff between the percentage of your income that goes towards housing costs and the number of options for frum amenities like yeshivas, shuls, and kosher restaurants, which are more plentiful in high cost of living communities. Choosing to stay at a lower-paying job that you love may require slashing discretionary spending more aggressively.
Living a life where a frum neighborhood, yeshiva education and kosher food are paramount can be costly and will undoubtedly require financial tradeoffs to make it possible. However, every family has their own set of circumstances, lifestyle choices and goals. Your priorities will dictate which of my previous suggestions are feasible and which are particularly unattractive. In order to achieve the life you want for your family, it’s important to appreciate the impact of tradeoffs and recognize where they come up within your personal finances.
The consequence of tradeoffs cuts both ways. For instance, one may decide to save a lot of money by living frugally and never indulging in travel, eating out or luxury items. However, the consequence of this decision is missing out on activities that may be fun and enjoyable. If you work hard for your money and live within your means, then choosing to live like a miser may not be an optimal decision for many.
As with many things, the key is balance. I call the juggling of financial tradeoffs “living your rich life.” The concept is that everybody’s ideal life looks different. While one family might value going on a summer vacation every year, they may place little importance on going out to eat. Another family may want to live in a smaller house in New York to be close to family rather than move to the Midwest where they could afford something much larger. Every family must clearly define what’s important to them and, consequently, eliminate other items that are less important.
I always tell my clients that before developing a financial plan they should take the time to determine their rich life. I ask them: What are your goals and aspirations? What is important to you personally? What are things that are low priority? Presumably, among readers of The Jewish Press, the answers may have some common themes around caring for loved ones and living a Torah lifestyle. However, beyond that, everyone’s definition of a rich life is different. The key is aligning your values with your financial plan and eliminating items that are a waste of time, money, and energy. Doing so will not only make life more affordable, but will also allow you to live your own personal rich life.
Readers are encouraged to ask their personal financial questions, which may be quoted from and addressed in a future column, by emailing email@example.com.