For age and want, save while you may; no morning sun lasts a whole day.
– Benjamin Franklin (1758)
Genesis chapter 41 of the Holly Book relates the story of Pharaoh’s dream concerning the economy of his land, Egypt. While you are probably well acquainted with the story, it is instructive to point out certain things that pertain to the inevitability of ‘lean’ years and the wisdom in saving during our ‘fat’ years.
Just for reminders, the story tells of how Pharaoh, king of Egypt, dreamt about how seven lean cows devoured seven fat ones without showing any sign of having eaten. He equally dreamt of seven thin heads of grain devouring seven fat and healthy heads.
The dreams interpreted
By divine insight, Joseph was able to make sense of the dream to mean seven ‘lean’ years of famine coming after seven years of national plenty. He also advised Pharaoh to save and store 20 percent of Egypt’s plenty during the fat years, and then use same up during the imminent years of famine.
As a result of his ability to interpret Pharaoh’s dream and advocate a solution to the looming problem, 30-year old Joseph was made prime minister and placed in charge of Egypt’s national treasury. What are the lessons we can derive from this account?
First, Egypt saved 20 per cent and nothing less of its national income in the years of plenty, so nothing less than 20 per cent of your current income will do as savings to take care of any lean years in the future. Saving 20 per cent of your earnings will give you a full year’s salary of saving in five years. This should not be impossible. Watch the ant. Over 50 percent of its effort is saved, as is obvious from the huge pieces of food much bigger than itself that it carries into its shelter.
Second, it is apparent that the idea of saving from income was novel to Egypt, which probably always had plenty, since Pharaoh was so impressed by the idea that he made its proponent, Joseph, his lieutenant, thus indicating that it is never too late to start. Egypt started late, yet became a world power through diligent savings.
Third, the lean cows in Pharaoh’s dream had been so ‘ugly and gaunt’ to the extent that their type ‘had never been seen in the land of Egypt’. This shows the type of severe impact that ‘lean’ years may come through many channels including temporary job loss, illness or incapacitation, and general economic downturn, among others. Only delayed gratification in the form of savings will take care of issues in such a period.
Fourth, the lean cows had devoured the seven fat cows without showing any improvement in their structure. This indicates that the ‘lean’ years have the capacity to ‘swallow’ entire savings made during the ‘fat’ years, and still not yield. Hence, the need to invest and multiply current savings, such that it would be more than take care of the ‘lean’ years.
Fifth, some other countries including Isreal – God’s own people – had journeyed to Egypt for food, and subsequently became Egypt’s slaves for over four hundred years, simply because they had not been wise enough to save in their years of plenty. The Holy Book specifically says that the borrower is slave to the lender.
Finally, lean years are inevitable, even for God’s own people. I believe that they are nature’s way of testing and proving human wisdom. Even countries and the entire world economy experience ‘lean’ years through the economic depression and such.
Thus, it was the 20 per cent Egypt saved while other nations were devouring all they made that made it a world power and colonialist of its time. This principle is equally applicable to personal money management affairs.
Saving is no more than delayed gratification; putting something aside from current earnings for use in the future. Even if none of the causes of lean periods outlined above happens to you, what about the inevitable, inescapable years when old age will prevent you from being able to put in the amount of service you are putting in now? Are you currently investing in your education, in the stock market, in properties, in the money market and in building enterprises?
Think about it!