Freelance Finance

A friend was telling us the other day how she was about to start giving her kids, ages 4 and 6, an allowance. Starting yesterday, they received four quarters. By parental fiat, each child had to deposit one quarter into a glass jar earmarked for the Charity of their choice. Each child dropped a second quarter into their own jar marked “Savings. And the last two quarters, according to her four-year-old, was for “Keepings.” Besides this, the kids could earn a quarter or two more by doing some small chores around the house.

Hers was a sweet story. It got me thinking back to my own allowances, the paper route I had with my brothers, and ultimate disposition of my own long-gone quarters. How much would have now if I had saved 25 percent of everything I made back then? How enriched would my favorite charities be if I had happily given them 25 percent from childhood on? And what of the 50 percent in Keepings? How long did I actually keep them, and what the hell did they ever amount to that I could lay my hands on today? (I’d have to check the provenance, but I think the Statue of Liberty souvenir that stands by my desk now as I write this might qualify, but little else.)

Let’s turn the question around: Imagine living only on 50 percent of every dollar you make. Could you do it? I know: It seems impossible. I’ve heard, but haven’t been able to confirm, that Sir John Templeton did so. He’s a billionaire investor who founded mutual funds, and got his start on Wall Street in the 1930s. He’s often lauded in religious circles for giving away 10 percent of his income—the classic tithing prescription—to charities.

For most of us, saving even 10 percent seems impossible. The American savings rate is officially in the red.

But get this: I don’t care how much you make, the only way to get ahead is to start dropping quarters in that jar. This is harder for the creative self-employed than for other people, because we don’t know month to month or year to year how much we’re going to earn, so we can’t set a dollar amount and sock it away every week. But what we can do is choose a percentage, and take that off the top of every check that comes in. You can start with 5 percent if you like. If that scares you, start with 3 or even 1 percent. The amount should be so little that you don’t even notice it. Open a money market account and deposit those few dollars in it every time one of your chronically late clients pays you. Keep that account separate from your other money. Every couple of months, increase that percentage gradually to whatever you think you can stand.

We in the arts always dream of the big score. The best-selling novel. The high-priced gallery show. Our own dance studio. The big break on the screen. Good. We should dream. We should believe.

But the biggest score we’ve got is the one we’re handed every day. We just don’t see it. Saving a quarter seems insignificant when we have all these miserable bills to pay—and it should. When you’re not looking, the quarters in the jar turn into something much more valuable than candy, comic books, and a cheap pot-metal Statue of Liberty. A buck a week in childhood is $2,500 by the time you’re 20, $6,300 by the time you’re 30, and $14,500 by the time you’re 40 years old.

You might scoff. The numbers seem small, but would you turn down $2,500 right now?